Northwest Airlines' $715 million financing package from the state of Minnesota has fallen through. Talks unraveled over the state's inability to fund $120 million in revenue bonds that would have been repaid by funds thrown off by new Northwest maintenance operations in Hibbing and Duluth.
Weighed down by debt and the recent purchase of Chicago's Midway Airlines, Northwest needs fresh capital now more than ever--especially if it still plans to buy bankrupt Continental Airlines. Rumors are rife that Northwest Co-Chairman Al Checchi is talking with British Airways about everything from an equity investment to linking up routes. Neither Northwest nor BA would comment.