Pinnacle obtains court approval for restructuring agreements

Washington DC
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A US bankruptcy court today accepted Pinnacle Airlines restructuring agreements with Delta Air Lines and its unsecured creditors' committee, as well as its collective bargaining agreement with pilots. The milestone allows the regional airline to finalise a restructuring plan that reflects its emergence from bankruptcy as a Delta subsidiary.

The Memphis-based regional airline announced on 3 January that it had forged the restructuring agreements, which provide an additional $30 million in liquidity. It also includes $22 million to satisfy payments under a bridge agreement within a new pilot labour contract, which employees approved on 15 January. The bridge agreement provides a hiring guarantee for many of Pinnacle's pilots once the airline becomes part of Delta.

Now that the court has approved the agreements, Pinnacle must file a bankruptcy plan acceptable to Delta by a 15 February deadline. That plan will entail retiring 140 50-seat Bombardier CRJ200s in the next two to three years in favour of a fleet of 81 CRJ900s, which the carrier will fly under the Delta Connection brand.