P.M. BRIEFING : Pan Am Promised Bank Financing for Northwest Airlines Takeover
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NEW YORK — Pan Am Corp. announced today it has secured bank financing for its proposed $3.6-billion bid for NWA Inc., the parent of Northwest Airlines and the target of a bidding contest.
Pan Am said it has received commitments from five banks: Bankers Trust Co., Citibank, First National Bank of Chicago, Morgan Guaranty Trust Co. and Security Pacific National Bank.
Pan Am declined to specify the amount of the banks’ commitments. Sources close to the company, however, said it exceeded the $1.6 billion that Pan Am said last week it was seeking.
“These commitments, together with the equity commitment of at least $400 million from Prudential-Bache and the Airlie Group, will enable Pan Am to put forward a very attractive offer to the shareholders of NWA,” Pan Am Chairman Thomas Plaskett said in a statement.
NWA, meanwhile, prepared to open bids from suitors for the company. NWA had set a 3 p.m. deadline today for takeover offers and said last week that it planned on a single round of bidding. The NWA board of directors, however, could decide not to accept any of the bids, and some analysts say the process could start over if a higher bid comes in later.
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