Delta Cedes Space at Logan's Terminal A

The settlement calls for Delta to give up more than one-third of its space in the terminal, whose 22 gates can serve 18 big jets and seven smaller regional jets parked on the tarmac.


Although the $497.8 million in bonds for the terminal were sold through Massport, Delta legally had the full obligation to repay them. Under the new deal, Delta would be absolved of that obligation. Whatever rent Massport collects from Delta and other airlines would go toward paying the bonds; whatever was left uncovered after available reserve funds set up for the bonds are depleted would be paid back by Ambac Assurance Corp. , a Wall Street "bond insurance" company Delta hired to repay the bonds if it went bankrupt. Massport won't face any financial liability for the terminal that could force it to raise parking rates or other charges on Logan customers and airlines.

Delta spokeswoman Gina P. Laughlin said yesterday, "We are pleased to have reached an agreement with Massport regarding Delta's Terminal A facilities in Boston. This necessary step in Delta's transformation plan allows us to achieve our restructuring goals while maintaining our commitment to the community and customers."

Laughlin said Delta is committed to remaining a big carrier in Boston. In March, she said, it plans to add a second daily non stop flight to Nashville .

The Delta terminal deal faces a Jan. 10 deadline for creditors to make objections before a judge could give it final approval Jan. 18.

Copyright (c) 2006, The Boston Globe



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