updated 8/2/2005 11:01:47 AM ET 2005-08-02T15:01:47

United Airlines said Tuesday its parent company has delayed filing a reorganization plan to leave bankruptcy, a move that could push its exit from Chapter 11 protection into next year.

The nation’s No. 2 airline said last month that it expected to file a Plan of Reorganization and disclosure statement — which together will provide a blueprint for United parent UAL Corp.’s exit from bankruptcy — to U.S. Bankruptcy Court around Aug. 1.

On Tuesday, United said it will continue to work on the plan with its unsecured creditors’ committee “in order to provide an additional opportunity to continue collaborating on and reviewing the complex, extensive documents as part of the overall confirmation process.”

The company said it expects to file the plan in about a month, delaying its previously stated goal of leaving bankruptcy sometime this fall.

“It may be later this year. It may be early next year,” United spokeswoman Jean Medina said of an eventual exit.

“When we first discussed exit timing, we had proposed a very aggressive schedule,” Medina said. “But both United and the creditors committee think this approach is going to help us have a smoother exit process.”

Carole Neville, an attorney for the unsecured creditors committee, said the committee continues to work with United on the plan. She declined to discuss how long the process might take.

The bankruptcy court, along with United’s lenders, unsecured creditors and others, must approve a reorganization plan before the carrier exits bankruptcy.

United, a unit of Elk Grove Village, Ill.-based UAL, still needs to secure $2 billion to $2.5 billion from banks to finance its planned exit from Chapter 11. It has been operating with the help of $1.3 billion in debtor-in-possession financing.

United has lost more than $7 billion since filing for Chapter 11 bankruptcy in December 2002. It also has slashed about $7 billion in annual expenses, including two rounds of wage and benefit cuts and termination and replacement of its employee pension plans.


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