Judge delays auction of Aloha Airline's go! lawsuit
Advertiser Staff
The sale of Aloha Airline's lawsuit against the parent of go! airlines will be delayed until next week after a federal judge raised questions about the fairness of the bid process.
U.S. Bankruptcy Judge Lloyd King said today that efforts to auction off Aloha's legal claims appear to favor the airline's main investor Yucaipa Co., which was the only company to put in a bid.
According to King, potential bidders like Mesa Air Group, the target of Aloha's lawsuit, haven't been given ample opportunity to submit a bid.
Yucaipa is offering to pay $10 million for the suit but none of that is in cash. Instead, the $10 million will be credited against the $100 million-plus that Aloha owes the investment firm.
A competing bid would have to offer an $11 million, all-cash bid to top Yucaipa's offer.
King will hold a further hearing June 26, which will give Mesa time to consider bidding on the suit. It also will allow Yucaipa to modify some of the terms of its offer.