Friday, February 1, 2013

American asks for another extension from bankruptcy judge

American Airlines is looking a bit like a college student asking for more time on a final exam, as it seeks its fifth extension for a deadline to present a bankruptcy exit plan.

The airline filed late Thursday in bankruptcy court to request the extension until April 15, the Fort Worth Star-Telegram reports. Currently, AMR Corp., American's parent company, has until March 11 to present its exit plan, which may or may not involve a merger with US Airways. The new request would supersede American's pending extension request, which was seeking an extension until April 1.

The bankruptcy court judge will have the final say on the extension request, but it's supported by American's unsecured creditors committee.

As noted in my story today on the potential merger, rumored merger dates have already slipped past with no news. The end of 2012, the first week in January, mid-January, and the beginning of this week were all whispered to be the time a merger would be announced. Now, the current rumors are that a merger will come by mid-February, when a major group of bondholders' confidentiality agreement expires. It's unclear how this latest extension request would fit with that timeline.

But as analysts have noted, as long as American remains in bankruptcy, the company's current management stays in control. They've stated before that they think American's standalone plan is viable, and AMR chief executive Tom Horton made no secret last year that he didn't want to pursue a merger while in bankruptcy. So, even though many people think a merger is a foregone conclusion at this point, don't be surprised if American continues running the clock.