It’s been revealed that American Airlines had been engaged in preparations for bankruptcy weeks in advance having engaged Rothchild’s as a financial advisor in the process.  AA is now asking its bankruptcy judge to retroactively approve Rothchild’s services for the course of its reorganization.

Some may think this shows a darker side to what led up to the bankruptcy but it really comes as no surprise to me.  The mere fact that American did file for bankruptcy was proof they were preparing for it as it is no trivial process and requires answering a lot of “what ifs” if you plan to do it right.

American Airlines would likely need financial advice during the process and having a heavyweight like Rothchild’s on its side makes for a smoother discussion with a variety of creditors.  The judge will approve Rothchild’s and Rothchild’s will earn its money over the course of reorganization.

However, the success of the reorganization remains in the hands of the executive team at American Airlines and that’s as it should be.

Filed under: Airline News by ajax