Disney says United bankruptcy could hit investments
12/05/02 14:04 ET
LOS ANGELES (Reuters) -- A bankruptcy filing by United Airlines could hit the financial results of entertainment giant Walt Disney Co., which has $114 million invested in aircraft leases to the carrier, Disney said in a regulatory filing.
United, the No. 2 U.S. airline and a unit of UAL Corp. , is on the verge of filing for Chapter 11 bankruptcy now that the federal government has denied it a loan guarantee request.
Disney, which invested $289 million in leases on aircraft to United, Delta Air Lines Inc. and FedEx Corp. between 1992 and 1994, said in its annual report filed with the Securities and Exchange Commission late Wednesday that bankruptcy could interrupt payments that have been paid promptly so far.
Chapter 11 bankruptcy protects companies from creditors while they reorganize, although terms of the reorganization must be approved by a court.
"The inability of any of the companies to make their lease payments or the termination of our leases through a bankruptcy proceeding could result in material charges related to a write-down of some or all of our investment and could accelerate income tax payments," Disney said in the filing, adding that it was monitoring United in particular.
12/05/02 14:04 ET
LOS ANGELES (Reuters) -- A bankruptcy filing by United Airlines could hit the financial results of entertainment giant Walt Disney Co., which has $114 million invested in aircraft leases to the carrier, Disney said in a regulatory filing.
United, the No. 2 U.S. airline and a unit of UAL Corp. , is on the verge of filing for Chapter 11 bankruptcy now that the federal government has denied it a loan guarantee request.
Disney, which invested $289 million in leases on aircraft to United, Delta Air Lines Inc. and FedEx Corp. between 1992 and 1994, said in its annual report filed with the Securities and Exchange Commission late Wednesday that bankruptcy could interrupt payments that have been paid promptly so far.
Chapter 11 bankruptcy protects companies from creditors while they reorganize, although terms of the reorganization must be approved by a court.
"The inability of any of the companies to make their lease payments or the termination of our leases through a bankruptcy proceeding could result in material charges related to a write-down of some or all of our investment and could accelerate income tax payments," Disney said in the filing, adding that it was monitoring United in particular.
