Bidder's plan wins union favor

By Debbie Sokei
Advertiser Staff Writer

Hawaiian Airlines union employees said yesterday they are willing to support a reorganization plan that can take the company out of bankruptcy without asking for labor concessions.

Corporate Recovery Group LLC, the Wyoming-based company bidding to take Hawaiian Airlines out of Chapter 11, filed a plan last week that does not require employees to take pay or benefit cuts or work longer hours but does freeze the pilots’ pension plan.

Floyd Baptist, assistant general chairman of the International Association of Machinists & Aerospace Workers District Lodge 141, said the union is looking for a plan with no employee concessions. The union’s office in Upper Marlboro, Md., is reviewing CRG’s plan but has not made a decision on whether to support it.

In January, the court-appointed trustee for Hawaiian, Josh Gotbaum, unveiled his business plan that asked for $4.8 million in labor givebacks from the pilots, $3.8 million from flight attendants and $1.5 million from machinists. Hawaiian has about 3,000 employees.

"Everybody’s anxious," Baptist said. "But we are in a wait-and-see pattern."

CRG said it will invest

$30 million in the airlines in exchange for 90 percent of the company. The plan is backed by Boeing Capital Corp. and Bruce Nobles, a former CEO of Hawaiian Airlines. Hawaiian Airlines filed for bankruptcy in March after John Adams, the chief executive at the time, could not reach an agreement with Boeing Capitol on reducing the cost of leased jets. Boeing asked the court to appoint a trustee to see the airline out of bankruptcy.

"Labor agreements with Gotbaum appear to be on hold for now. Everybody is looking at CRG’s plan," said Jim Giddings, chairman of Hawaiian Airlines' unit of the Air Line Pilots Association. "Things are starting to move."

Airline spokesman Keoni Wagner said Gotbaum is still planning to file a reorganization plan of his own.

Hawaiian Holdings Inc., the parent company of Hawaiian Airlines, and Vx Capital Partners, a San Francisco-based airline investment company, are also expected to file competing bids.

Stephen Compagni Portis, partner with Vx Capital, told a meeting of Hawaiian Airlines creditors committee that he is willing to invest between $20 million to $40 million in the airlines, said a source who did not want to be identified because Compagni Portis’ plan has not been filed with bankruptcy court yet.

Reach Debbie Sokei at 525-8064 or dsokei@honoluluadvertiser.com.