Braniff Struggling to Find Buyer, Creditors Told

Executives of Braniff Inc. told a roomful of disgruntled creditors Tuesday that the airline was just getting by as a “limited charter carrier” while seeking a buyer and continues to run up expenses under bankruptcy proceedings.

“We have a number of alternate plans, but each plan requires investments,” said Howard McKinnon, the company’s chief operating officer, who along with Braniff Chairman Bill McGee has been talking to potential investors or outright buyers for the Orlando-based airline.

The lack of adequate funding “prevents us from having any meaningful discussion or planning,” McKinnon said, adding that pressure from creditors “clouds this whole issue.”

Howard T. Glassman, a Philadelphia lawyer representing Braniff, told the creditors in one of a series of meetings conducted by the bankruptcy trustee that there was no clear picture of the airline’s future.

But officials said they do not expect Braniff to go into liquidation and sell its assets.

The company, which filed for Chapter 11 protection from creditors Sept. 28, has 275 to 300 employees left from a total of about 4,800, the officials said. It is losing money on a charter operation run by 15 pilots.

Mark Osterberg, Braniff’s senior vice president for finance, said in response to questions from creditors’ lawyers that the company had about $500,000 cash in hand and monthly expenses of about $1.7 million, including $1 million in payroll for remaining employees. The figures do not include hefty legal fees, the charter operation and other non-scheduled expenses, he said.

Osterberg also said the company pays $1 million in rental costs every month. Braniff anticipates some $3 million to $4 million in credit card fees and another $1.5 million from other sources this coming month, he said.