7-Apr-2010 12:19 PM

Sun Country Airlines files plan to exit bankruptcy; profitable in 2009

MN Airlines LLC, operating as Sun Country Airlines, filed a Chapter 11 reorganisation plan in US Bankruptcy Court in St Paul (Minnesota) that would cede ownership of the company to creditors, including current owner, Petters Aviation (Bloomberg/Pioneer Press/Star Tribune, 06-Apr-2010). The carrier, which specialises in service from Minnesota to warm-weather locations in the Caribbean and Mexico, filed for creditor protection in Oct-2008. The reorganisation plan would give certain unsecured creditors 100 shares of stock in the newly formed company for each USD1,000 of their claims. MN estimated the claims at USD80 million. MN stated “expressions of interest” in acquiring the company indicated a range of valuation from USD10 million and USD30 million, although these expressions resulted in “no definitive offer". Under the plans to exit bankruptcy, current CEO, Stan Gadek and the airline's management team would remain, while creditors would approve a new Board. The airline handled 983,000 passengers in 2009, a 23% year-on-year reduction. The carrier reported a profit of USD1.4 million in 2009, on revenues of USD202 million, and paid USD3.5 million in bankruptcy-related expenses. The carrier reporting a profit of USD1.9 million in Jan-2010 and Feb-2010, on revenues of nearly USD40 million.

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