ATA Airlines Exits Bankruptcy Court

ATA Airlines yesterday emerged from 16 months of Chapter 11 bankruptcy protection with what the carrier said is a revised business model that will strengthen its position. Meanwhile, the newly solvent carrier and Southwest Airlines today announced the details of a new long-term codeshare agreement, through which Southwest will sell "ATA-only service" for certain markets.

In addition to the new agreement with Southwest, ATA said while under court protection it realigned its route structure to focus on more profitable markets, while obtaining majority funding from MatlinPatterson, a private equity firm. As such, ATA returns to solvency as a privately held company.

"Now that we've accomplished the monumental task of restructuring, our next focus will be on incrementally improving our operations," ATA president and CEO John Denison said yesterday in a statement.

"ATA's current scheduled service footprint in markets where the company has a proven track record of success, such as Hawaii, and the codeshare relationship with Southwest provide an excellent basis for profitable growth," said Subodh Karnik, ATA COO. "In addition, our established military and commercial charter business provide a solid diversified foundation. Add to that our commitment to delivering high-end operating performance, and one begins to see
the new winning picture taking shape at ATA."

ATA city pairs that Southwest will sell include Washington National and Chicago Midway; Dallas/Fort Worth International and Chicago Midway; Honolulu and Las Vegas; Honolulu and Los Angeles; Honolulu and Oakland; Honolulu and Ontario, Calif.; Honolulu and Phoenix; Houston Hobby and La Guardia; Chicago Midway and La Guardia; Hilo and Oakland; Los Angeles and Maui; Oakland and Maui; and Phoenix and Maui.

Southwest in a statement said that travelers have the option to credit rewards program points to either ATA or Southwest.