U.S. Republic Air Files for Chapter 11 Bankruptcy Protection Due to Failing Revenues
Posted: Friday, February 26th, 2016 at 11:04 pm
Republic Airways Holding Inc., a domestic and nationwide airline carrier service, filed for chapter 11 bankruptcy protection last Thursday. The company explained to the court, through documents, about its loss of revenue during the past quarters due to the grounding of aircraft because of a shortage in pilots.
Republic Airlines Holding Inc. is situated in Indianapolis, but it also provides many flights to numerous other national airlines like Delta, American Airlines, and the United Continental Holdings Inc. However, when presenting the documents in court, the airline displayed its huge asset liability of $3.6 billion. The chapter 11 bankruptcy protection would enable Republic Airways to normally carry on with their business. It would also restructure the company finances and contracts, in order to improve the company’s financial credibility.
Republic Airlines Holding Inc. is among a few domestic airline companies that filed for bankruptcy protection, back in 2011, in the case of American Airlines Inc. Bryan Bedford, Chairman of Republic Airways Inc. stated “We have worked very hard to avoid taking this step but it seems that without a proper restricting, we cannot be able to run the airlines properly and make it prosper in the coming years”. Republic Airways provides almost 1,000 domestic and international regular flights around the United States, making it one of the major airline services in the country.
According to Republic Airways, the whole process of restructuring will not impact its flight schedules as previously announced. The company is said to have sufficient amount of liquidity and resources to properly carry on their scheduled routine flights during the recovery procedure.
The carrier currently has a staff of 6,000 people around the United States at different locations. Republic Airways Inc. also noted that they will continue to respect the collective bargaining agreements already made with the unions. In addition, the increased backup of investors will most likely restore Republic Airways’ financial interests after obtaining bankruptcy protection.