REBECCA RAYKO / MIAMI
Troubled Las Vegas carrier stakes its future on talks with two possible white knights
National Airlines has been given a short stay of execution from bankruptcy until 22 June by a US federal court judge.
The Las Vegas-based carrier, which filed for Chapter 11 bankruptcy protection last December, will use the time to continue negotiating a rescue plan with billionaire financier Carl Icahn.
National is also in talks with a second bidder for the airline, the Las Vegas Sun newspaper says. Negotiations with a second party were confirmed by National chief executive Mike Conway, although he declines to disclose its identity.
Icahn, former owner of TWA, has been negotiating the purchase of two-year-old National since May.
National, which is losing cash at the rate of $2m per month, continues to operate its fleet of 16 Boeing 757s from McCarran International Airport hub until it runs out of options. The airline blamed fuel costs for its difficulties when it filed for protection last year.
Icahn also bid to purchase TWA during its bankruptcy proceedings earlier this year. He stands to lose a lucrative discount ticketing agreement with TWA when American Airlines finalises the integration of the two airlines. Icahn has been re-selling discounted TWA tickets through his Internet company, Lowestfare.com. Analysts believe Icahn is likely seeking a similar arrangement with National.
Meanwhile, Harrah's Entertainment, which owns 48% of National, was prevented by court order last week in Las Vegas from collecting more than $17m in loans from the airline. Had Harrah's collected, National would have been unable to receive cash advances from ticket sales which would have essentially grounded the carrier.
Source: Flight International
