ATA Airlines runs into bankruptcy

10/27/04 - newratings.com

NEW YORK, October 27 (newratings.com) – ATA Holdings Corporation (ATAH), the parent company of ATA Airlines, has filed for bankruptcy protection, becoming the latest victim of the rising fuel costs and intensified competition in the industry.

ATA Holdings filed for Chapter 11 bankruptcy protection yesterday in the US Bankruptcy Court of the Southern District of Indiana. The company said that it was coordinating with third-party creditors to secure bankruptcy financing. ATA Airlines said that AirTran Holdings would buy its gate leases and routes at Chicago's Midway Airport, New York's LaGuardia Airport and Washington's Reagan National Airport for $87.5 million. The deal is subject to regulatory and bankruptcy court approvals. The low-fare airline listed its total assets at $745.1 million and its debt at $940.5 million in the bankruptcy filing. Meanwhile, American West has expressed its intention to bid for ATA Airlines. Among other US-based airlines, US Airways Group had filed for bankruptcy last month and United Airlines is struggling to emerge from bankruptcy, while Delta Air Lines has warned regarding potential bankruptcy.