ATA Airlines files for bankruptcy protection

ATA Airlines files for bankruptcy protection
INDIANAPOLIS (AP) — ATA Airlines, the nation’s 10th-largest airline, filed for bankruptcy protection Tuesday, one day after naming an executive to oversee the restructuring of the discount carrier’s mounting debt.
The filing under Chapter 11 of the federal bankruptcy code came as the Indianapolis-based airline, whose parent company is ATA Holdings, faces soaring fuel costs, an industry fare war and sharply lower demand for military charter flights.

The airline also is saddled with millions of dollars in debt from new aircraft purchases.

The value of the company plummeted 36% Tuesday, its stock closing at 93 cents a share, down 53 cents, on the Nasdaq stock exchange. The stock had hit a 52-week high of $13.31 on Feb. 2.

In its filing, the company seeks bankruptcy protection for eight different corporate entities from more than 1,000 creditors. The filing lists total assets of about $745.1 million and total debts of $940.5 million.

ATA, founded in 1973 in Indianapolis as American Trans Air, uses Chicago’s Midway Airport as a hub, and its flights through Midway account for about two-thirds of ATA’s scheduled passenger traffic.

It currently has 7,900 employees, but in recent weeks, the company has announced plans to cut more than 300 jobs, including 150 flight attendants. So far this year, ATA pilots and flight attendants have accepted nearly $70 million in wage concessions.

In an SEC filing last week, ATA said its finances have worsened since Aug. 16, when it reported it had lost $90.7 million during the first half of 2004

http://www.usatoday.com/money/biztravel/2004-10-26-ata-airline-bankruptcy_x.htm