Republic Airways’s unsecured creditors are likely to recover less than 50c on the dollar in the airline’s bankruptcy, and stockholders should expect nothing at all, according to a letter from the company. The pool of money available to pay creditors will be no greater than $275m to $350m and could be reduced by at least $100m Republic will need to exit Chapter 11, the airline said in a letter to the US Trustee, the Justice Department’s bankruptcy watchdog. Unsecured creditor recoveries also depend on Republic successfully restructuring as much as $1b in debt, the airline said. “In light of those numbers, unsecured creditors are faced with the prospect of recovering potentially well less than 50c on every $1 of claims, and equity holders will therefore receive no distributions,” according to the April 4 letter, which was included in a regulatory filing. Republic wrote to ask the US Trustee to reject requests to appoint an official committee to represent shareholder interests in its bankruptcy. Such a panel would burden Republic with “substantial and duplicative costs and expenses,” the airline said. A large proportion of the company’s shares are held by “a small number of highly sophisticated investors, including one group of six wealthy hedge funds” that are already actively participating in the case, Republic said. <br/>
unaligned
The suspense surrounding India’s battle with bad loans and defaulters is getting deeper. A litigation over the quality of a jet engine may determine how much lenders can claw back from Vijay Mallya, the besieged founder of the failed Kingfisher Airlines. The catch: The nation’s famously snail-paced, gridlocked judiciary where some cases have dragged on for almost two decades. Banks need to agree to the plan and will respond on Thursday. The indebted ex-billionaire, who has sparred with local media for portraying him as the poster boy for soured loans, owes about $1.4b, according to the government. Last week he offered to settle his dues with a 40b-rupee ($600m) payment by the end of September. He also promised 20b rupees more if United Breweries, the parent of Kingfisher, wins a lawsuit alleging defective engines from International Aero Engines contributed to his carrier’s collapse. The Supreme Court on Thursday will hear bankers’ views on whether they are willing to accept Mallya’s offer. <br/>
Thai AirAsia (TAA) appears to have set a record in Thailand's airline industry in terms of the number of new routes and the speed in moving them to launch. <br/>In under three months, the country's largest low-cost carrier (LCC) has committed to as many as nine new routes, with four already taken to the skies. <br/>The new routes reflect TAA's unprecedented aggressiveness in network expansion at a time when other Thai-registered airlines are largely staying put. <br/>The red flag imposed by the International Civil Aviation Organization over Thailand's aviation safety deficiencies since last June has put the brakes on expansion for most airlines because of restrictions on opening new routes. <br/>TAA executives acknowledged the speed of network expansion is exceptional in the airline's 12-year history as the airline focuses on growing its network, moving away from last year's emphasis on raising flight frequencies on existing routes. In the first quarter of last year, TAA announced the launch of only four routes, all domestic from the carrier's Don Mueang airport base to Roi Et, Nan, Buri Ram and Loei.<br/>
Mumbai-based GoAir plans to take delivery of its first Airbus A320neo in May if it is confident in the performance of the Pratt & Whitney PW1100G geared turbofan (GTF) engines powering the aircraft. The carrier, which currently operates a fleet of 19 A320s, has 72 A320neos on order (all set to be powered by GTFs) and confirmed to ATW that it is slated to take delivery of eight A320neos by May 2017. But the airline is concerned about the startup restrictions currently imposed on GTF-powered A320neos. Qatar Airways backed out as the planned A320neo launch operator late last year owing to the restrictions and Lufthansa, which became the replacement launch customer, told ATW that it agreed to accept its second A320neo only after reaching a compensation deal with Airbus. Lufthansa has said it won’t accept its third A320neo until it is satisfied that hardware and software fixes being made by Pratt on the GTF are sufficient to allow it to operate the aircraft “throughout our European network and not only on domestic routes,” a Lufthansa spokesperson said. <br/>