16 airlines applied for loan guarantees

Passenger, cargo carriers seek more than $3.7 billion

July 09, 2002|By BLOOMBERG NEWS

WASHINGTON - Sixteen U.S. passenger and cargo airlines, including United Airlines parent UAL Corp., applied for more than $3.7 billion in federal loan guarantees before the application deadline June 28, the companies and a government board said.

Three companies - MEDjet International Inc., Gemini Air Cargo Inc. and Corporate Airlines Inc. - filed requests on the last day, the Air Transportation Stabilization Board said in a statement summarizing the program.

Earlier applicants included United, the world's second-largest carrier and seeker of $1.8 billion in guarantees, and No. 7 US Airways Group Inc., which wants $900 million.

Congress and President Bush established the $10 billion guarantee fund shortly after the terrorist attacks of Sept. 11 to help airlines avoid bankruptcy and recover from related losses.

Phoenix-based America West Holdings Corp. is the only airline that has won a guarantee, receiving $380 million in backing in January.

America West's money is included in the total.

The board rejected requests for $7.2 million by Frontier Flying Service Inc., a small commuter carrier in Alaska, and for $13.5 million by Vanguard Airlines Inc.

Vanguard, based in Kansas City, reapplied for a $35 million guarantee and is one of 14 carriers with requests pending.

Birmingham, Ala.-based MEDjet, which operates medical transport planes, asked for $116 million in guarantees; Dulles, Va.-based Gemini, which charters planes to shippers and airlines and operates some service, wants $33 million; and Smyrna, Tenn.-based Corporate, which flies as a connection carrier for AMR Corp.'s American Airlines, seeks $8 million, the companies' chief executive officers said.

Airlines' federal loan requests

The carriers that have applied for at least $3.74 billion, and the amounts they are seeking, are listed below. The total includes pending, approved and rejected requests.

Pending Requests:

UAL Corp.'s United Airlines......$1.8 billion

US Airways Group Inc. ......$900 million

Evergreen International Airlines Inc.+

ATA Holdings Corp.'s American Trans Air......$148.5 million

MEDjet International Inc. ......$116 million

Great Plains Airlines......$61.5 million

Spirit Airlines Inc. ......$60 million

Frontier Airlines Inc. ......$59.5 million

National Airlines Inc. ......$50.5 million

Aloha Airgroup Inc. ......$40.5 million

Vanguard Airlines Inc.*......$35 million

Gemini Air Cargo Inc. ......$33 million

World Airways Inc. ......$27 million

Corporate Airlines Inc. ......$8 million

Rejected Requests: Frontier Flying Service Inc. ......$7.5 million

Vanguard Airlines Inc.* ......$13.5 million

Approved Request:

America West Holdings Corp. ......$380 million

+Company declined to disclose the amount. *Vanguard applied once, was rejected and applied a second time.

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