The Crowded Skies Over Pan Am

Pan Am's final chapter is getting interesting. Delta, United, and Chicago investor Jay Pritzker are all still in the running. Delta offered slightly more than $200 million for Pan Am's remaining European routes, its Frankfurt hub, and its Northeast-corridor shuttle, says one creditor. But that bid will face pressure. United--which is bidding for Pan Am's Latin American system--also wants the routes to France, the transatlantic routes out of Miami, and some of the Airbus jets Delta has asked for. Pritzker, meanwhile, is still looking to take over the whole airline.

Off on the sidelines, one of Pan Am's major creditors has also taken the offensive. Several sources confirm that federal Pension Benefit Guaranty is arranging a bid for the Pan Am Shuttle. Because of missed pension payments, the PBGC has a $53 million lien on the shuttle's equity. So it has wooed fellow creditor General Electric Credit and a European buyout company called Overseas Partners to construct an offer.

A bid would be a long shot at best. But by floating its own shuttle deal, the PBGC might also pressure Delta. Pan Am has an unfunded pension liability of $840 million. The more Delta pays, the more the pension agency will get. Whatever happens will have to happen quickly: Sources say Pan Am is fast running out of cash.

Before it's here, it's on the Bloomberg Terminal.