American Airlines Group (AAL) - Get Report is reportedly close to hiring Guggenheim Securities Co-Chairman James Millstein for help in dealing with the $50 billion airline government aid package approved last week.
Knowledgeable sources told Reuters that American hasn’t decided yet to accept the aid, but the potential hiring of the executive indicates it’s thinking along those lines.
Millstein, who specializes in debt restructuring, led the Barack Obama administration’s overhaul of several financial-services firms, including insurer American International Group (AIG) - Get Report in 2009-11, in the wake of the financial crisis.
All airlines have seen their profits decimated by the coronavirus pandemic, which has led to cancellation of many flights. Some of those that have flown endured passenger counts in the single digits.
American said Sunday that it would suspend 60% of its capacity in April, compared with April 2019, and that it planned to suspend up to 80% of its capacity in May.
If he is hired, Millstein would help American Air determine what kind of aid it wants to request and how it can negotiate the Treasury Department’s aid process, Reuters’ sources said.
He would be working independently of Guggenheim.
The $2 trillion fiscal stimulus package that includes the airline assistance enables the government to take an equity stake in some companies that it helps.
At last check, American’s shares traded at $12.21, down 13%. The stock has dropped 54% from Feb. 12 through Friday's close.