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Flying J, Pilot Travel Centers reach preliminary merger agreement
By Caroline Salls
Pittsburgh, July 14 - Flying J Inc. and Pilot Travel Centers LLC have entered into a preliminary merger agreement that will provide a framework for Flying J's core travel plaza business to emerge from Chapter 11 bankruptcy, according to a company news release.
Under the terms of the letter of intent, all of Flying J's creditor obligations would be paid in full.
Pilot has also agreed to provide $100 million in debtor-in-possession financing for Flying J's operations.
"After a careful and exhaustive review of the alternatives available, we have concluded that a merger with Pilot represents the best possible outcome for Flying J, our creditors, our customers, and our employees," Flying J board chairman Crystal Call Maggelet said in the release.
"Over the next few months, we will negotiate definitive agreements to merge our companies.
"This transaction will allow us to emerge from the bankruptcy process relatively quickly thereafter and to start a new chapter in the Flying J story."
According to the release, the preliminary merger agreement with Pilot pertains specifically to Flying J's core travel plaza business, and it excludes Longhorn Pipeline, Big West Oil, Flying J Oil & Gas, Haycock Petroleum and Transportation Alliance Bank.
Flying J said it is in the process of evaluating alternatives for each of these other businesses.
Flying J, an Ogden, Utah, fully integrated oil company, filed for bankruptcy on Dec. 22, 2008 in the U.S. Bankruptcy Court for the District of Delaware. Its Chapter 11 case number is 08-13384.
Pilot is a Knoxville, Tenn.-based retail operator of travel centers.
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