NEW YORK - After 20 months of a wrenching reorganization, Northwest Airlines won approval yesterday to emerge from bankruptcy protection and face an industry crowded with competitors and besieged by soaring fuel costs.
After Judge Allan Gropper approved its reorganization plan, Northwest Airlines Corp. of Eagan, Minn., said it would exit bankruptcy May 31. Northwest, the nation's fifth-largest airline, also is to announce post-bankruptcy marketing plans when it emerges.
The carrier's chief executive officer, Douglas Steenland, said the company had reached all its bankruptcy goals, including cutting annual operating costs by $2.4 billion, reducing debt and lease expenses by $4.2 billion a year, and shrinking the overall size of its business.
By its latest count, the company has 30,787 full-time workers, compared with 33,755 when it filed for bankruptcy Sept. 14, 2005.
Nearly 97 percent of creditors approved the reorganization.
Under the plan, Northwest's secured creditors will be paid in full. Most unsecured creditors are expected to be paid 66 cents to 83 cents on the dollar in new shares of the reorganized company. Existing shares will be canceled, leaving shareholders with nothing.