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  • joshr31 Mar 28, 2013 12:34 AM Flag

    AMR Sees ‘Reasonable Possibility’ of Shareholder Value..... ABKFQ also?

    --- Some similarities? ---

    Jan. 9 (Bloomberg) -- AMR Corp., the bankrupt parent of American Airlines, says its value has “significantly appreciated” and there may be a recovery for shareholders, who generally receive nothing in bankruptcy cases.

    AMR, which is considering a merger with US Airways Group Inc. (LCC), rose 44 percent to $1.30 at 4 p.m. in New York. It was the highest value since Nov. 28, 2011, the day before the carrier sought bankruptcy protection. The shares trade over the counter.

    AMR Corp., which is considering a merger with US Airways Group Inc., notified the Office of the U.S. Trustee of the development in a Jan. 3 letter filed today with the Securities and Exchange Commission.

    “Depending upon the ultimate strategic alternative adopted and pursued, there exists a reasonable possibility that there may be value for AMR equity holders,” AMR attorney Harvey Miller wrote in a Jan. 3 letter to the Office of the U.S. Trustee, which monitors bankruptcy proceedings. The document was filed yesterday with the U.S. Securities and Exchange Commission.

    AMR’s $460 million of 6.25 percent convertible notes due in October 2014 climbed 3.9 percent to 96.25 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The bonds traded at 17.75 cents after AMR filed for Chapter 11.

    --- Like Ambac bonds, 12 cents now trading over 70 cents? Not much further to go... ---

    “The U.S. Trustee could conceivably appoint an equity committee, although this late in the bankruptcy process, it would be quite rare,” Helane Becker, an analyst with New York- based Dahlman Rose & Co., said in a report today.

    Miller, of law firm Weil, Gotshal & Manges LLP, wrote in the letter that AMR previously opposed the formation of an equity committee in the bankruptcy case to represent shareholders because “there did not appear to be a substantial likelihood” that they would receive “any meaningful distribution.”

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