US Airways Group Inc late Friday said it had reached a $125 million deal with an investor group to fund its restructuring under bankruptcy protection. The company said it reached the agreement with Eastshore Aviation, an investment entity owned by Air Wisconsin Airlines, a privately held regional airline. The $125 million facility will be made in the form of a debtor-in-possesssion term loan, US Airways said.

"As an initial investor, Eastshore is providing us with short-term liquidity and also is demonstrating support for our restructuring and interest in a longer-term relationship with US Airways," US Airways chief executive Bruce Lakefield said.

US Airways filed its second bankruptcy petition in two years last September. It hopes to emerge as leaner airline with a new route structure and substantially lower costs. It plans to operate as a low-cost carrier domestically, with premium routes to Latin America and Europe.

Copyright Reuters, 2005