Northwest Airlines (Pink Sheets: NWACQ) is close to emerging from bankruptcy, and says that once it’s on the other side, the company will start fresh – including making a bid to list on the New York Stock Exchange.
The bad news? Investors holding NWACQ – Northwest’s current stock – won’t be benefiting from the move.
The company announced Wednesday that, according to an early vote tally, its reorganization plan will likely be approved by creditors.
“The unofficial vote tally indicates that 96.9 percent of the airline’s creditors who voted, representing 98.4 percent of the dollar amount of the claims that voted, approved the Northwest plan,” the company said in a statement.
The final results will be filed with the U.S. Bankruptcy Court for the Southern District of New York. A confirmation hearing on the reorganization plan is slated for May 16. The court approved Northwest’s disclosure statement in March, clearing the way for the company to begin asking for creditor approval of the plan. Creditor voting ended Monday.
“We appreciate our creditors’ confidence in the Northwest Plan of Reorganization, which provides creditors with a stake in Northwest Airlines going forward and represents a substantial recovery on their unsecured claims,” said Doug Steenland, Northwest CEO, in the same statement. “Today’s creditor approval is another step in Northwest’s efforts to complete its restructuring next month and to move forward as a strong, fully-competitive airline. In recent weeks, we have announced the composition of our new board of directors, indicated a desire to list our new common stock on the New York Stock Exchange and reported a first quarter profit, excluding unusual and reorganization items, for the first time since 1998.”
The company, however, also announced that on the day the reorganization plan goes into effect, all outstanding common stock will be cancelled “for no consideration, and, therefore, the company’s existing stockholders will no longer have any interest as stockholders in the company.” The company wants to begin trading as NWA on the NYSE.
Northwest closed down 16 percent Wednesday, at 13 cents a share, with a 52-week range of $6.55 to $0.082.