Tudor Group Commits $65 Million in New Equity Funding to US Airways-America West Upon Completion of Merger
July 07 2005 - 2:01PM
PR Newswire (US)
Tudor Group Commits $65 Million in New Equity Funding to US
Airways-America West Upon Completion of Merger ARLINGTON, Va., July
7 /PRNewswire-FirstCall/ -- America West Group Holdings (NYSE:AWA)
and US Airways Group, Inc. (OTC:UAIRQ) (BULLETIN BOARD: UAIRQ)
announced today that Tudor Investment Corp., a leading asset
management firm, has made a $65 million commitment to provide
equity funding for US Airways' Plan of Reorganization (POR) in
exchange for approximately 3.9 million shares of new common stock
at a price of $16.50 per share. Funding will occur along with other
equity investments upon completion of the merger. "The inclusion of
Tudor as a new equity partner is a clear indication that investors
continue to find great potential in our proposed merger with
America West Airlines," said Bruce R. Lakefield, US Airways
president and chief executive officer. "We are making tremendous
progress in completing a merger that will provide the combined
airline financial stability in this highly competitive
marketplace." The Tudor Group, which consists of Tudor Investment
Corporation and its affiliates, is involved in active trading,
investing, and research in the global equity, debt, currency, and
commodity markets. Founded in 1980 by Paul Tudor Jones II, the firm
currently manages over $11 billion. The firm's investment
capabilities are broad and diverse, including global macro trading,
fundamental equity investing in the United States and Europe,
emerging markets, venture capital, commodities, event driven
strategies and technical trading systems. The other equity partners
funding the US Airways POR and merger with America West are ACE
Aviation Holdings Inc., ($75 million commitment) a Canadian holding
company that owns Air Canada, Canada's largest airline with over
$7.5 billion in annual revenues; PAR Investment Partners, L.P.,
($100 million commitment) a Boston-based investment firm; Peninsula
Investment Partners, L.P., ($50 million commitment) a
Virginia-based investment firm; and Eastshore Holdings LLC, ($125
million commitment and agreement to provide regional airline
services), which is owned by Air Wisconsin Airlines Corp., and its
shareholders. The rights offering could provide an additional $150
million of equity financing. As announced, the merger will be
funded by $565 million in new equity investment and participation
by suppliers and business partners that will provide the company
with approximately $1.5 billion in liquidity. Terms of the Tudor
agreement have been filed with the U.S. Bankruptcy Court for the
eastern district of Virginia, where the US Airways case is being
heard. The US Airways and America West merger, which is expected to
close in the early fall, will create the first full-service
low-cost nationwide airline, with a consumer-friendly pricing
structure offering a network of low-fare service to over 200 cities
across the United States, Canada, Mexico, Latin America, the
Caribbean and Europe, and amenities that include an extensive
frequent flyer program, airport clubs, assigned seating and First
Class cabin service. The airline will operate under the US Airways
brand and will be headquartered in Tempe, Ariz. The U.S. Department
of Justice has completed its review of the proposed merger of the
two airlines without issuing a formal request for additional
information (commonly referred to as a "second request"). Since the
30-day period for alternative offers on the proposed merger ended
without any competing offers having been submitted, and since there
are no qualified competing plan proposals, US Airways will proceed
to seek confirmation of the POR implementing the merger agreement
and investment agreements. FORWARD-LOOKING STATEMENTS Certain of
the statements contained herein should be considered "forward-
looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements may
be identified by words such as "may," "will," "expect," "intend,"
"anticipate," "believe," "estimate," "plan," "could," "should," and
"continue" and similar terms used in connection with statements
regarding the companies' outlook, expected fuel costs, the RASM
environment, and the companies' respective expected 2005 financial
performance. Such statements include, but are not limited to,
statements about the benefits of the business combination
transaction involving America West Holdings Corporation ("America
West") and US Airways Group, Inc. ("US Airways" and, together with
America West, the "companies"), including future financial and
operating results, the companies' plans, objectives, expectations
and intentions and other statements that are not historical facts.
Such statements are based upon the current beliefs and expectations
of America West and US Airways' management and are subject to
significant risks and uncertainties that could cause the companies'
actual results and financial position to differ materially from
these statements. Such risks and uncertainties include, but are not
limited to, the following: the ability of the companies to obtain
and maintain any necessary financing for operations and other
purposes, whether debtor-in-possession financing, in the case of US
Airways, or other financing; the ability of the companies to
maintain adequate liquidity; the duration and extent of the current
soft economic conditions; the impact of global instability
including the continuing impact of the continued military presence
in Iraq and Afghanistan and the terrorist attacks of Sept. 11, 2001
and the potential impact of future hostilities, terrorist attacks,
infectious disease outbreaks or other global events; changes in
prevailing interest rates; the ability to attract and retain
qualified personnel; the ability of the companies to attract and
retain customers; the cyclical nature of the airline industry;
competitive practices in the industry, including significant fare
restructuring activities by major airlines; the impact of changes
in fuel prices; economic conditions; labor costs; security-related
and insurance costs; weather conditions; government legislation and
regulation; relations with unionized employees generally and the
impact and outcome of the labor negotiations; US Airways' ability
to continue as a going concern; US Airways' ability to obtain court
approval with respect to motions in the Chapter 11 proceedings
prosecuted by it from time to time; the ability of US Airways to
develop, prosecute, confirm and consummate one or more plans of
reorganization with respect to the Chapter 11 proceedings; risks
associated with third parties seeking and obtaining court approval
to terminate or shorten the exclusivity period for US Airways to
propose and confirm one or more plans of reorganization, to appoint
a Chapter 11 trustee or to convert the cases to Chapter 7 cases;
the ability of US Airways to obtain and maintain normal terms with
vendors and service providers; US Airways' ability to maintain
contracts that are critical to its operations; the potential
adverse impact of the Chapter 11 proceedings on US Airways'
liquidity or results of operations; the ability of US Airways to
operate pursuant to the terms of its financing facilities
(particularly the financial covenants); the ability of US Airways
to fund and execute its Transformation Plan during the Chapter 11
proceedings and in the context of a plan of reorganization and
thereafter; and other risks and uncertainties listed from time to
time in the companies' reports to the SEC. There may be other
factors not identified above of which the companies are not
currently aware that may affect matters discussed in the
forward-looking statements, and may also cause actual results to
differ materially from those discussed. The companies assume no
obligation to publicly update any forward-looking statement to
reflect actual results, changes in assumptions or changes in other
factors affecting such estimates other than as required by law.
Similarly, these and other factors, including the terms of any
reorganization plan of US Airways ultimately confirmed, can affect
the value of US Airways' various prepetition liabilities, common
stock and/or other equity securities. Accordingly, the companies
urge that the appropriate caution be exercised with respect to
existing and future investments in any of these liabilities and/or
securities. Additional factors that may affect the future results
of America West and US Airways are set forth in their respective
filings with the SEC, which are available at
http://www.shareholder.com/americawest/edgar.cfm and
http://investor.usairways.com/edgar.cfm, respectively. ADDITIONAL
INFORMATION AND WHERE TO FIND IT In connection with the proposed
merger transaction, America West Holdings and US Airways Group have
filed a Registration Statement on Form S-4 and other documents with
the Securities and Exchange Commission (Registration No. 333-
126162) containing a preliminary joint proxy statement/prospectus
regarding the proposed transaction. The proxy statement/prospectus
will be mailed to stockholders of America West Holdings after the
registration statement is declared effective by the SEC. WE URGE
INVESTORS TO READ THE REGISTRATION STATEMENT AND PROXY STATEMENT
AND OTHER RELATED MATERIALS CAREFULLY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. Investors will be able to obtain free copies of the
registration statement and proxy statement (when available) as well
as other filed documents containing information about US Airways
Group and America West Holdings at http://www.sec.gov/, the SEC's
Web site. Free copies of America West Holdings' SEC filings are
also available on America West Holdings' Web site at
http://www.shareholder.com/americawest/edgar.cfm, or by request to
Investor Relations, America West Holdings Corporation, 111 West Rio
Salado Pkwy, Tempe, Arizona 85281. Free copies of US Airways
Group's SEC filings are also available on US Airways Group's Web
site at http://investor.usairways.com/edgar.cfm or by request to
Investor Relations, US Airways Group, Inc., 2345 Crystal Drive,
Arlington, VA 22224. This communication shall not constitute an
offer to sell or the solicitation of an offer to buy any
securities, nor shall there by any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended. PARTICIPANTS IN THE SOLICITATION America West Holdings, US
Airways Group and their respective executive officers and directors
may be deemed, under SEC rules, to be participants in the
solicitation of proxies from America West Holdings' stockholders
with respect to the proposed transaction. Information regarding the
officers and directors of America West Holdings is included in its
definitive proxy statement for its 2005 Annual Meeting filed with
the SEC on April 15, 2005. Information regarding the officers and
directors of US Airways Group is included in its 2004 Annual Report
filed with the SEC on Form 10-K on March 1, 2005. More detailed
information regarding the identity of potential participants, and
their interests in the solicitation, will be set forth in the
registration statement and proxy statement and other materials to
be filed with the SEC in connection with the proposed transaction.
DATASOURCE: US Airways Group, Inc. CONTACT: America West Holdings
Corp., +1-480-693-5729; or David Castelveter of US Airways Group,
Inc., +1-703-872-5100 Web site: http://www.usairways.com/
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