Hawaiian Airlines said yesterday its stock will remain halted on the American Stock Exchange and Pacific Exchange for at least another three weeks until the AMEX has a chance to review the airline's annual financial report. Hawaiian stock halted
until at least mid-AprilBy Dave Segal
dsegal@starbulletin.com
Trading was suspended in the shares of Hawaiian Holdings Inc., Hawaiian's parent, at midday Friday when the carrier filed for Chapter 11 reorganization bankruptcy. Hawaiian's stock, priced at $1.50 when it was halted, likely will trade for less than $1 when it resumes trading.
Hawaiian, which was required by the Securities and Exchange Commission to file its 10-K report no later than March 31, said it will seek a deadline extension and will submit its report to the SEC by April 15.
It will then be up to the AMEX to determine whether Hawaiian, given its Chapter 11 filing and financial condition, meets the listing standards to be able to have its stock resume trading. If Hawaiian is unable to satisfy the AMEX requirements, it will have one other opportunity to have its stock traded on that exchange. This would involve Hawaiian submitting a compliance plan to the AMEX. If the plan is accepted, Hawaiian would be allowed to trade during a trial period and, if the airline achieves its milestones in the plan, would be able to trade past that conditional period.
If Hawaiian fails to meet those milestones, the AMEX will delist the company and trading in Hawaiian's shares would be on the Over-the-Counter Bulletin Board. The stock was delisted in March 1994 when the AMEX suspended trading in the stock during Hawaiian's last bankruptcy. The shares ultimately fell to 1 cent over the counter before the stock was canceled. Hawaiian emerged from bankruptcy in September 1994.
Andrew Schwarz, whose firm is the market specialist for Hawaiian on the AMEX, said this morning he urged the exchange to trade the stock once it receives Hawaiian's request for a filing extension.
"I'm saddened about this bankruptcy," said Schwarz, a partner with AGS Specialist Partners. "We don't like losing a company, and Hawaiian for us is a premiere name and gives us recognition as a firm."
AGS is in charge of orders that flow through the AMEX and, in the absence of public orders, uses its own funds to stabilize the price of the stock.
Meanwhile, Ansett Worldwide, one of three aircraft lessors affected by Hawaiian's bankruptcy filing, said it is still examining its options.
"We are evaluating our response," said Ansett spokesman Mike James, who's based in Sydney, Australia. "The Chapter 11 filing is naturally a matter of concern because we were in negotiations with them. There had been some indication that Hawaiian might file for bankruptcy, but it wasn't an explicit statement."
James said Ansett has a contract to lease eight Boeing 767-300 extended-range aircraft and Hawaiian so far has received seven of them. The final 767 was to be delivered in early May, James said.
"Under Chapter 11 bank-ruptcy law, Ansett has a right to repossess the aircraft after 60 days," James said. "I'm not sure if that right will be exercised, but we do have that right."
Boeing Capital Corp., which has delivered 13 717-200s and three 767s to Hawaiian, is scheduled to deliver one more 717 to Hawaiian in April. But spokesman Russ Young said yesterday the status of that delivery is in question.
"Arguably, they could accept it," Young said. "But then they'd have to start making lease payments on it."
The remaining lessor, International Lease Finance Corp., said yesterday it did not have any comment. ILFC has delivered four 767s to Hawaiian.
Hawaiian Airlines
American Stock Exchange
Pacific Exchange