ATSG Makes Debt Deal With DHL

WILMINGTON, Ohio (AP) — Cargo hauler and service provider Air Transport Services Group Inc. said on Wednesday that its subsidiary ABX Air Inc. has signed a deal with shipper DHL that would have the effect of reducing the company's total debt by more than $110 million.

The amendment for an unsecured promissory note with DHL was signed on Monday, ATSG said. The note also calls for DHL to withdraw its demand for prepayment.

The company also said it agreed to pay DHL $15 million to reduce the principal on the promissory note, and that DHL agreed to extinguish another $46.3 million of the principal balance.

The company also signed a memorandum of understanding giving DHL options to lease four Boeing 767 freighters from ABX beginning Aug. 15, 2010, and running through 2015.

ATSG said it was delaying the filing of its 10-K for 2008 because of the agreement.

Shares of ATSG jumped 12 cents, or 50.2 percent, to 36.8 cents in afternoon trading.