Airtran goes for Midwest Airlines

[SWA/FO]

Midwest spokeswoman Carol Skornicka says their offer is way too low.

Now, I'm just a pilot but what if they (airTran) just bought up shares of midwest on the open market, and not pay the premium? Then say "hey we own 30% of you, how about selling us the rest".

 

[EX_CV580FR8Dawg]

now we just need to let them talk to Michael McGee Jackson. That'll scare 'em off!

http://www.todaystmj4.com/_content/news/topstories/story_6060.asp


AirTran folks are in town campaigning, they're meeting with the mayor of Milwaukee and the MKE county board. Don't know how they impact the shareholders' vote, but oh well...

 

[Ty Webb]

Relative Seniority

Personally, i think the only truly fair integration of two pilot groups is by using a "relative seniority" integration. If you were a 10% f/o at Airtran or Medex, then you would be a 10% f/o after integration. You would enjoy the same schedules / days off, QOL as you had previously. Midwest pilots would probably benefit from this since it would most likely allow the f/os to upgrade faster than if they were at Midwest. Obviously there would be a few issues to be resolved, and I would think any ties would have to go to the buyer.

Thoughts?

I think you are right about a 'relative seniority" being the most fair.. . . . there might be some precedent set by the Airways/Valujet merger previously.

If it goes through, "Welcome Aboard" to all, except for Chuck Yogurt, who will need to re-apply, and will be interviewed by a board consisting of Fletch, FL717 and myself, with 737Pylt observing as a neutral party . . . . Oh, and the questions will be written by BestPilot.

If hired, Chuckie will fly a special schedule, custom built by Carol . . it will be in a BAC111, with Mad Dog as his Captain . . . . they will fly a schedule that is made of double Newark turns on weekdays, Stand-ups on the weekends, and Red-eyes on holidays.

.

 

[Lear70]

Lear70,

first of all, i'm an AirTran pilot - so i'm not trying to help out the other side. I'm just trying to find a reasonable solution to integrations - i didn't say it was perfect - that's why i'm soliciting constructive conversation.

That's cool, didn't mean to sound like I was going on the offensive or anything,,,

I also don't want something that's going to hurt EITHER side. It's not fair to staple their guys to the bottom of the list, nor is it fair to ask our F/O's to suddenly find themselves stuck on F/O pay for another 2, 3, or 4 years with a one for one or even one for five integration.

Hell, the current delivery schedule, if no more orders are placed, just barely puts our CURRENT F/O's in the CA seat at the end of it, much less if you added 200 or so more guys in front of them.

Talk about mass exodus, we were discussing the upcoming recalls and hiring for the majors and the pilots here (who would go, who wouldn't). Most of us aren't actively looking anywhere else, as we like the schedules we're getting and the 3 year upgrade (for pilots hired in the last year or two) is HUGE, but I tell you this:

If this thing comes to fruition and you add 2 or 3 years to someone's upgrade track OR if you put enough people in front of them that they have no hope of upgrade by the time we take our last scheduled 737 delivery PLUS we don't get a contract by the time 1 or 2 more majors start hiring or we end up with only 10% or so of a raise for the F/O's (which basically only covers COLA for the period we've been without COLA raises), you WILL see a mass exodus towards the door.

The HR department has been able to be very picky the last several years, and most of the new-hires have LOTS of PIC jet time, 4 year degrees, and clean backgrounds. There's nothing stopping them from bailing as the flood gates open up except a promising future of quick upgrade at a decent pay rate (currently here).

Take that away and leave them making the same thing they were as an RJ Captain stuck as an F/O for a decade and this company could easily start seeing $5 Million a year or more in training cost expense increases.

 

[BoilerUP]

Unless AAI bought up most of their needed MEH shares yesterday, they're gonna have to pony up more cash...

 

[FDJ2]

How about a history lesson....why did they do that?

That's not the issue, the issue is the ALPA merger policy

Why did the TWA pilots abandon their contractual protections is another issue all together, although I would venture to say that given the grave financial situation at TWA at the time, and the likely consequences if AMR did not acquire TWA, they felt it was in their best interest to do so in order to facilitate the transaction.

 

[Lear70]

That's not the issue, the issue is the ALPA merger policy

Why did the TWA pilots abandon their contractual protections is another issue all together, although I would venture to say that given the grave financial situation at TWA at the time, and the likely consequences if AMR did not acquire TWA, they felt it was in their best interest to do so in order to facilitate the transaction.

ALPA merger policy is only applicable if BOTH carriers are ALPA carriers.

Otherwise seniority integration has to be negotiated between both unions.

There's several examples of this over the last 30-40 years...

 

[TV9Driver]

Lear70,

I agree with you 100%. I'm a 2 year f/o and I really don't want my upgrade taken away or severly delayed. I can't afford being an f/o anymore! That's why I said that any issue or tie should go to AirTran pilot's benefit.

FDJ2,

TWA pilots did not think it was in their best interest to abandon our protections, we were told by our ALPA representation that it was required for us to agree to it to facilitate a "fair and equitable" integration.

 

[ultrarunner]

ALPA merger policy is only applicable if BOTH carriers are ALPA carriers.

Otherwise seniority integration has to be negotiated between both unions.

There's several examples of this over the last 30-40 years...

Lear would be correct on this. It really didn't matter in TWA's case. AA was calling the shots and essentially told the court and the unions what it wanted and what it was going to do.

And all things considered, it likely was a better deal than if AA had walked away.

 

[Taildragon]

Midwest Air Group Expands on Decision to Decline AirTran's OfferMILWAUKEE, Dec 13, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Midwest Air Group, Inc. (Amex: MEH) - parent company of Midwest Airlines - today expanded on its decision to decline a proposed merger agreement with AirTran Holdings. According to Timothy E. Hoeksema, chairman and chief executive officer, the Midwest Air Group board of directors spent considerable time and effort evaluating AirTran's offer of $11.25 per share in cash and AirTran stock. As part of Midwest's evaluation, the board engaged investment banking firms and an outside consulting firm.
"During their comprehensive review, those advisors considered the offer in light of Midwest's business and strategic plans," explained Hoeksema. "Under our strategic plan, we are projecting annual capacity growth of more than 10% over the next three years including a 50-seat regional jet program, along with significantly greater growth in profitability. Additionally, we view AirTran's offer at only about $5 per share, because it includes approximately $6 per share in cash that already belongs to our shareholders." As previously announced, the Midwest board determined that pursuing a merger with AirTran would not be in the best interests of the company, its shareholders and other stakeholders - including customers, employees and the communities the airline serves.
"While it is the fiduciary obligation of the board of directors to review credible offers, the board unanimously concluded that Midwest's business plan as a stand-alone company would support a considerably better return to our shareholders than AirTran's offer," Hoeksema said. "We are successful because we provide customers with an exceptional travel experience. Our product and service are unique, and are not readily compatible with a merger with another carrier."
Hoeksema added that employees of Midwest have been overwhelmed by the groundswell of public support of the board's decision since the news became public today. "We are very fortunate to have customers and shareholders who enthusiastically support our decisions and appreciate our efforts to provide 'The best care in the air.' We are very proud to be Milwaukee's hometown airline."
Midwest Airlines features jet service throughout the United States, including Milwaukee's most daily nonstop flights and best schedule to major destinations. Catering primarily to business travelers and discerning leisure travelers, the airline earned its reputation as "The best care in the air" by providing passengers with impeccable service and onboard amenities at competitive fares. Skyway Airlines, Inc. - Midwest's wholly owned subsidiary - operates as Midwest Connect and offers connections to Midwest Airlines as well as point-to-point service between select markets on regional jet and turboprop aircraft. Together, the airlines offer service to 47 cities. More information is available at http://www.midwestairlines.com .
This document contains forward-looking statements about the results expected under the company's strategic plan and that otherwise may state the company's or management's intentions, hopes, beliefs, expectations or predictions for the future. Words such as "projecting," "expect," "anticipate," "believe," "estimate," "goal," "objective" or similar words are intended to identify forward-looking statements. It is important to note that the company's actual results could differ materially from projected results due to the risk factors described in Item 1A. Risk Factors in the company's "Annual Report on Form 10-K" for the year ended December 31, 2005.
SOURCE Midwest Air Group, Inc.
Media Inquiries: Carol Skornicka, +1-414-570-3980 (o), +1-414-303-6516 (c) or [email protected] , or Analyst- Investor Inquiries: Dennis O'Reilly, +1-414-570-3954 (o) or Dennis.O'[email protected]