Northwest to be worth $7b after bankruptcy

MINNEAPOLIS -- Northwest Airlines Corp. said yesterday it expects to be worth roughly $7 billion when it emerges from bankruptcy this year, and will pay its unsecured creditors roughly three-quarters of what they are owed.

Northwest said it expects to issue new common stock that would cover around 74 percent of what its unsecured creditors are owed. Some creditors could get as much as 91 percent of what they're owed if they choose to buy additional shares, which Northwest is hoping will raise an additional $750 million.

The company said that stock offering would be for almost 27.78 million shares to be issued at $27 a share, underwritten by J.P. Morgan. Altogether Northwest plans to issue almost 272 million new shares, with most of the rest going to the unsecured creditors, and an unspecified number to managers.

Northwest said it will have $8.75 billion to $9.5 billion in allowed general unsecured claims.

Secured creditors will be paid in full, Northwest said.

Northwest filed details of its emergence plan in bankruptcy court in New York yesterday, repeating expectations that its current shares will be worthless once it emerges.