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 It seems we've hit the latest wave of airline bankruptcies, driven by sky-high oil prices and an economic downturn. April was particularly dark and May was cloudy, but June will see at least one sunny day. U.K. all-business-class carrier Silverjet plc, which was grounded at the end of May and filed for administration after backer Viceroy Holdings failed to extend a $5 million loan, has, it seems, been rescued. Swiss investment company Heritage Cie. SA agreed June 11 to buy it out of bankruptcy for undisclosed terms.
Meanwhile, Eos Airlines Inc. capped April -- a particularly active month for carriers running into turbulence -- with a bankruptcy filing. The Purchase, N.Y.-based New York-to-London business carrier filed for Chapter 11 April 26 in the U.S. Bankruptcy Court in the Southern District of New York and ceased operations April 27. It said May 23 it had won approval for an asset auction. But the Eos filing followed several of late. A recap:
NEXT UP? Amid the bankruptcy crashes, The Deal's Lou Whiteman wondered April 7 which airline would file next. "And while no one is predicting a near-term shutdown of carriers such as Frontier Airlines Holdings Inc. [indeed, Frontier has not ceased operations], Spirit Airlines Inc., Midwest Air Group Inc. and Virgin America Inc., these airlines are being watched closely," he wrote. Spirit Airlines
Midwest
Virgin America
Alitalia-Linee Aeree Italiane SpA And then there's Alitalia. The Italian government unveiled plans April 3 to try to revive talks between Air France-KLM Group and unions representing Alitalia's workers in a move to stave off a bankruptcy filing for the carrier. Air France-KLM walked away from its €139 million ($217 million) bid for Alitalia following the collapse of negotiations with unions on disagreements over how much restructuring work the carrier needed. The Alitalia auction is the government's latest attempt to sell its 49.9% stake in the money-losing carrier. A LITTLE PERSPECTIVE Whiteman offers a bit of context to the current, seeming rash of filings and how larger players will likely fare:
CO-PILOTING But some, having made it through reorganizations, or in order to be strong enough to emerge, have sought merger partners and carried on. Take Delta Air Lines Inc. and Northwest Airlines Corp. agreed to a deal April 14 after months of circling each other and trying to win labor approval for a deal. Reports indicated April 11 that pilots had reached a tentative deal that would allow for a merger, after months of impasse. The pair resumed talks April 7, weeks after pilots rejected arbitration March 19, stuck at a crossroads. It had looked like the airlines' pilots were on board Feb. 19, but the picture was cloudier just a week later. Delta soared out of bankruptcy April 30, 2007, ahead of schedule, followed by Northwest, which headed for the exit May 31. Delta flew solo after months of standing firm against a would-be acquirer in US Airways Group Inc. Its creditors formally backed the plan for independence in late January, rebuffing a $10.2 billion takeover offer from US Air. It happened a day after Delta secured a $2.5 billion exit financing package and days after reports surfaced that US Air was considering raising its offer. After winning an extension to reorganize until June, Delta pledged March 20 to pay its workers $480 million in cash and stock upon its emergence. It unveiled plans Aug. 21 to install former Northwest CEO Richard Anderson as its chief executive, which again stirred the M&A rumor mill. US Airways first presented its merger case to Delta in November 2006, which the target shot down. Had it not, the deal would have recalled Tempe, Ariz.-based US Airways' $1.5 billion merger with America West Group Holdings Corp. in 2005, which formally ended its own stay in Chapter 11. Then there is United Airlines parent UAL Corp., which said Aug. 24, 2007, it could sell off its maintenance business to shore up some cash, a deal that analysts estimated could yield $300 million to $600 million. In December 2006, speculation swirled around UAL and Continental Airlines Inc. Rumors regarding UAL first took flight in September 2006 after a published report revealed it had hired Goldman, Sachs & Co. to explore strategic alternatives. During its nearly three years in bankruptcy, UAL cut 25% of its workers, trimmed more than $10 billion in debt and cut annual costs by more than $7 billion before resurfacing post-Chapter 11 in February 2006. - Carolyn Murphy CategoriesComments Deal Video
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Spirit's model, 
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Virgin America is a 
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With these multi-million dollar companies having such financial difficulties, it's hard to imagine how the rest of us can get through these challenging economic times.