AirTran tacks on add'l $140M to cash

[lowecur]

Well that went nice and smooth, as investors see the viability and value of this airline. Over allotment of 2.3M shares to be sold later today. Should boost cash/short term investments to $550M, and give the Tranny a nice cushion to ride out the coming capitulation. Stock is undervalued by 25% in my opinion.

http://biz.yahoo.com/prnews/080501/nyth026.html?.v=101

imp:

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[Ty Webb]

Should boost cash/short term investments to $550M, and give the Tranny a nice cushion to ride out the coming capitulation. Stock is undervalued by 25% in my opinion.

Alright . . . . where are all those clowns who were predicting an AirTran bankruptcy soon?

[sounds of crickets chirping]


TW

 

[EMB170Pilot]

Frontier I think is the weakest right now

 

[Full of LUV]

Frontier I think is the weakest right now

I think ATA is on the ropes...... Aloha not much behind them.....

 

[Colonel Savage]

I think ATA is on the ropes...... Aloha not much behind them.....

Relevant comments as always from the LUV "peanut gallery"...

 

[vixin]

I think it was sarcasm, albeit in poor taste.

 

[TV9Driver]

so how much of that 140 mil will go to our new contract pay raises?

 

[lowecur]

so how much of that 140 mil will go to our new contract pay raises?

Actually, it's being earmarked for unemployment compensation for those who choose to rock the boat.

imp:​

 

[scarlet]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

 

[RadioClash]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

Dude, you have been drinking the kool aid way too much over there in newhire training...yes, we need a raise, at the very least FO's.

 

[Full of LUV]

I think it was sarcasm, albeit in poor taste.

It was sarcasm, I luv it when the prognasticators come on here with the airline du jour that will be out of business by some time certain. Fact is unless you work in the accounting dept for any of the operations, no one really knows what kind of shape their in. No one I read forcasted ATA folding up completely, nor Aloha..... of course, now everyone seems to think Frontier and Airtran are on the ropes....of course hindsight is 20/20.

 

[TV9Driver]

Geez Scarlet, why don't you take a deep breath.... I was being sarcastic.

But since you brought it up.. I didn't get into this business to top out at $66/hr. I've been furloughed before and remarkably, its isn't too difficult to replace a $60k salary.

This gas problem has absolutely nothing to do with our salaries. It costs me more to fill up my car, buy groceries, etc. so why would I not want a pay raise.

I don't claim to have the answers, but don't tell me it's my (pilots) fault and i'm gonna have to take pay cuts or else..

Remember, Fornaro just got over 4 million dollars in bonuses.....

 

[D-Bo]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

In that case your weak a** should fly for free then. I guess you think pilot pay makes airlines go out of business. It doesn't. But as long as you believe that you will get raped a few times on pay before your airline career is over. You're airline managements wet dream. Pin cushion.

 

[TV9Driver]

amen D-Bo

 

[Max Powers]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

Scarlet works in the training dept. I know who he is.

 

[SkiFishFly]

No Concessions!!! NO CONCESSIONS!!!!!


I do NOT and WILL NOT pay for fuel!!!!!!!!!!

 

[Lear70]

Scarlet works in the training dept. I know who he is.

That makes sense... I used to think it was someone in the C.P.'s office based on comments he'd make, but that makes much more sense.

 

[bravodude]

-- Lowest non-fuel unit costs in the industry -- a position we intend to
maintain.

Gee I wonder how they will accomplish this!

 

[BigMeat]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

I hope you get really drunk some night and end up in some big guys trunk. In my fantasy you would wake up as he pulls you out by your hair and pulls you into his trailer. Then he would tie all of your limbs spread eagle to his cheap WalMart bed post. Then he would pull out one of those cheap condoms that are next to free in the bathroom stalls. By the look of that thing you know that it shouldnt be fitting into it, somehow he manages. You know your going to be sorry......stupid management pilot!

 

[PinnacleDude]

-- Lowest non-fuel unit costs in the industry -- a position we intend to
maintain.

Gee I wonder how they will accomplish this!

Congratulations to AirTran on the refinance. You guys work hard and certainly deserve a better contract. I wish you guys the best.

FWIW, L70 and others were somewhat prophetic on not giving in on FO pay. I think that is a good lesson for everyone. Never assume that good (or bad) times are going to last forever. Look at things from all angles and don't get carried away by flashy rates, etc. It is the whole package that makes a contract (and airline) liveable.

Here's to hoping a penny or two more of that CASM goes to the pilots!

 

[ron burgundy]

Alright . . . . where are all those clowns who were predicting an AirTran bankruptcy soon?

[sounds of crickets chirping]


TW

Good news..for now! Be careful of what you speak. The disclaimer could be "soon".

 

[spitfire1500]

Yeah lets get raises for about 4-6 months and then out of business=SMART !! Then where do you go and have 15 days off, and insurance for your family? What airline is hiring? With this great economy it is a great time to lose your job!

Be blessed that you have a job !!=Never Happy..you would not be happy with a raise....

Airlines Hiring: USAir, Southwest, Kalitta, Southern, Korean, Emirates,Atlas, Polar, Cathay, Allegiant, JAL, Air NZ, Qantas and pretty much all the regionals....and some of these places actually pay you.......(drumroll)....MONEY!!!! 15 days off and crap insurance that is watered down with you still having to pay a big part of it along with copays doesn't feed my family! (if any of the above are not hiring please correct me or if anyone has any airlines to add feel free).

 

[Andy]

Alright . . . . where are all those clowns who were predicting an AirTran bankruptcy soon?

[sounds of crickets chirping]


TW

Ty, this keeps AAI out of ch 11 for now. Did you read the entire press release? Keep in mind that it was written by AAI, so it's got a positive spin to it.
AAI just increased its debt load by >10%. AAI will also have to pay interest on that new debt. Quarterly. They're convertible - are they death spiral financing bonds? Those are freaking nasty. I hope not. We'll have to wait and see where the conversion price is and the terms on the bonds. At 5.5% interest rate, it's a great interest rate. That tells me that there are probably some real nasty aspects to those bonds.
Small dilution of shareholders by issuing additional shares. For pilots, we don't care. For shareholders, this isn't a good thing. As a pilot, I'd like United to issue another 1 billion shares of stock to raise additional capital. It'd kill the stock price, but I don't care.

Did you catch this portion of the press release:
"Reducing our capacity growth against the current environment from a prior planned 10 percent from Sept. through Dec. 2008 and from a prior planned 10 percent in 2009 to no more than flat in both periods to improve unit revenue."

That means that, at best, AAI will have zero growth through all of 2009. Reading between the lines, it tells me that AAI is looking at decreasing ASMs this and next year. Not good for pilots.


All of the above steps are good and necessary to keep AAI out of bankruptcy. However, it sucks for pilots.

Look, we're all eating sh!t sandwiches right now. It sucks for everyone (except Southwest). Even if AAI declares bankruptcy, it's not likely to be the end of Airtran.
Good luck to everyone at Airtran and every other airline. It's going to be very painful for a while for most of us.

 

[Andy]

Stock is undervalued by 25% in my opinion.

Back up the truck and load up. Dilution's a good thing (not). Don't check to see what the terms of the convert are - the devil's in the details.
Nothing like attention deficit disorder investing.

 

[Andy]

I hope you get really drunk some night and end up in some big guys trunk. In my fantasy you would wake up as he pulls you out by your hair and pulls you into his trailer. Then he would tie all of your limbs spread eagle to his cheap WalMart bed post. Then he would pull out one of those cheap condoms that are next to free in the bathroom stalls. By the look of that thing you know that it shouldnt be fitting into it, somehow he manages. You know your going to be sorry......stupid management pilot!

Dude, that's the second time in a week or so where you've posted something along those lines. Your fantasies are, to put it nicely, disturbing. Your screen name's bigmeat; it doesn't take much to figure out which person you are in those fantasies. I take it you shop at WalMart and live in a trailer.

 

[lowecur]

Back up the truck and load up. Dilution's a good thing (not). Don't check to see what the terms of the convert are - the devil's in the details.
Nothing like attention deficit disorder investing.

Yo Andy. The 8K is out, and I'm as dumb as a bucket of rocks. Please point out the "death spiral" financing that is going to drive the stock price down the tubes, and just how low we can expect it to go. Also, I be(pardon my lack of venacular) curious to your thoughts on the analcyst that cut the legs off AAI earlier this month by lumping them in with FRNT as to their financial strength. I need to learn from those that are experienced. Thanks for your help in advance.

imp:​

http://secfilings.nasdaq.com/filing...LDINGS+INC&FormType=8-K&RcvdDate=5/2/2008&pdf=

 

[FIREMAN]

Ty, AAI will also have to pay interest on that new debt. Quarterly.

From The 8K

"interest on the notes due in semi-annually payments"

 

[Andy]

From The 8K

"interest on the notes due in semi-annually payments"

Dude, do you REALLY think that it makes a difference if they pay interest quarterly or semiannually? Man, you're missing the forest for the trees.

 

[Andy]

Yo Andy. The 8K is out, and I'm as dumb as a bucket of rocks. Please point out the "death spiral" financing that is going to drive the stock price down the tubes, and just how low we can expect it to go. Also, I be(pardon my lack of venacular) curious to your thoughts on the analcyst that cut the legs off AAI earlier this month by lumping them in with FRNT as to their financial strength. I need to learn from those that are experienced. Thanks for your help in advance.

imp:​

http://secfilings.nasdaq.com/filing...DINGS+INC&FormType=8-K&RcvdDate=5/2/2008&pdf=

Sorry, this looks like classic (to a 'T') death spiral financing. The conversion rate on the bond is 260.4167 shares per $1000 principal. That converts to $3.84/sh, give or take. This allows the owners of the bonds to short AAI stock and be able to convert the bonds to stock at $3.84/sh in order to cover their short sales. That gives them a ceiling as to how much money is at risk for them in shorting the stock.
Also, note that the conversion rate is adjustable. I haven't dug through the supplemental indenture to see how the conversion ratio changes, but I can almost guarantee you that the adjustment rate is in the favor of the bondholders. There should
The bonds are likely to be bought by hedge funds who are going to short the fukc out of AAI.

I'm going to have to spend some time this weekend pulling apart the 8-K, but it is very bad news for stockholders.

As for AAI, I still think that this was a smart move; they need the cash to stay out of chap 11. It will either keep them out of chap 11, with a stock price of near zero, or it will be their last drink at the well of financing prior to chap 11. The door to raising additional capital for AAI just closed with this bond offering.

As for Neidl's comments on the airline industry, I can't say that I totally disagree with him. He's been around for quite a while and knows what he's talking about. I ignore any upgrades/downgrades from Wall Street because they're for suckers; you've got to do your own research. When I shorted the piss out of Northwest prior to their chap 11, it seemed like everyone and their brother upgraded the stock all the way to the bitter end. It cost me a bit, but I ended up making out very well in the end.

 

[jehtplane]

Dude, do you REALLY think that it makes a difference if they pay interest quarterly or semiannually? Man, you're missing the forest for the trees.

Wow, a pilot for United giving AirTran @*#$.. Just when you think you have seen it all. Might want to check on your own house. Didn't CAL just look at your books and say no F#@$ing way in hell.