airtran makes another offer to midwestAirTran Holdings, Inc., Commences Exchange Offer for Midwest Air Group
Thursday January 11, 5:00 am ET
- Enhanced Offer of $13.25 Per Share -
- Represents 61 Percent Premium at Time of Initial Offer -
ORLANDO, Fla., Jan. 11 /PRNewswire-FirstCall/ -- AirTran Holdings, Inc. (NYSE: AAI - News; "AirTran"), the parent company of AirTran Airways, today announced that it has commenced an exchange offer for all of the outstanding shares of Midwest Air Group (Amex: MEH - News; "Midwest"), for $13.25 per Midwest share, based on the closing price of AirTran common stock on January 8, 2007. The offer consists of $6.625 in cash and 0.5884 shares of AirTran common stock for each Midwest share. The total equity value of the exchange offer is $345 million. The offer, which is being made through Galena Acquisition Corp., a wholly owned subsidiary of AirTran, represents a premium of 61 percent over the thirty day average closing price of Midwest common stock at the time of AirTran's initial proposal to acquire all of Midwest's common stock at a price of $11.25 per share on October 20, 2006, and an approximately 46 percent premium over the closing price the day prior to December 13, 2006, the date on which AirTran disclosed its October 20, 2006, offer.
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"We are committed to bringing these two great airlines together to form an even better airline based on our conviction that it is in the best interests of Midwest and AirTran shareholders, the employees of both companies and the communities the air carriers serve," said Joe Leonard, AirTran Airways' chairman and chief executive officer. "Together, we will be in a stronger position to compete in the changing airline marketplace, to grow underserved cities like Milwaukee and Kansas City, increase employment and advancement opportunities, and to provide our customers with the high quality service they value."
"While we would have wished to enter into negotiations with Midwest's Board and management to consummate a definitive merger agreement, it is clear that they had no intention of doing so. Largely due to the overwhelming support we have received for the combination from Midwest shareholders, employees, customers and the communities Midwest serves, after the disclosure of our October 20th proposal, we decided to bring our offer directly to Midwest's investors," he added.
"It is clear to most stakeholders that AirTran Airways can grow Midwest Airlines, expand the Milwaukee market and add more destinations and service beyond what Midwest can achieve independently. With our fleet commonality, comparable corporate cultures, commitments to quality service and complementary route networks, we are an ideal partner for Midwest," Leonard added.
"We feel so strongly about the merits of this combination that we are enhancing the value in our actual exchange offer despite the already attractive premium and the fact that Midwest has denied our request to review non-public financial and other information. Even with the increase in the price we are offering, we still expect the transaction to be accretive to earnings by the end of the first full year following the close of the transaction and significantly accretive thereafter," Leonard concluded.
AirTran is offering to acquire all of the outstanding shares of Midwest through its newly formed subsidiary, Galena Acquisition Corp., which was organized in connection with this offer. This exchange offer is the first step in AirTran's plan to acquire all of the outstanding shares of Midwest common stock. AirTran intends, promptly after completion of the offer, for Midwest to consummate a second-step merger whereby Midwest common stock would be converted into the right to receive the same number of shares of AirTran common stock and the same amount in cash per Midwest share as paid in the exchange offer.
The exchange offer will be subject to customary conditions, including the tender of a majority of Midwest shares, calculated on a fully diluted basis; redemption of the Midwest rights under its Rights Agreement, commonly known as a poison pill, certain actions to ensure that the Wisconsin control share acquisition statute and business combination statute are not applicable to AirTran following the exchange offer; the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act ("HSR") and certain other regulatory approvals.
The exchange offer is scheduled to expire at 12:00 midnight, New York City time, on February 8, 2007, unless the exchange offer is extended.
Morgan Stanley and Credit Suisse are serving as AirTran's financial advisors and the dealer managers and Smith, Gambrell & Russell, LLP, is serving as AirTran's legal advisor. Innisfree M&A Incorporated is serving as its Information Agent.
Shareholder questions regarding the exchange offer or requests for offering materials should be directed to Innisfree M&A Incorporated at (877) 456-3422. (Banks and Brokers may call collect at 212-750-5833). Offering materials are also available on the SEC's website at http://www.sec.gov. Midwest shareholders are urged to read the offering materials filed by AirTran, which contain important information about the exchange offer.
AirTran executives will be discussing the exchange offer on a Webcast conference call with the investment community at 10:00 a.m. EST/9:00 a.m. CST today, January 11, 2007. To access the Webcast go to http://investor.airtran.com. A replay of the call will be available on the AirTran Airways Web site.
JL's Letter to Midwest
AirTran Chairman and CEO Sends Letter to Board of Directors of Midwest Air Group
ORLANDO, Fla., Jan 11, 2007 /PRNewswire-FirstCall via COMTEX/ -- AirTran Holdings, Inc. (AAI : airtran hldgs inc com
AAI11.92, +0.58, +5.1%) , the parent company of AirTran Airways, announced today that Joe Leonard, AirTran Chairman and Chief Executive Officer, sent a letter to the Board of Directors of Midwest Air Group (MEH : Midwest Express Holdings, Inc. (Wisconsin)
News , chart, profile, more
Last: 12.90+0.80+6.61%
MEH12.90, +0.80, +6.6%) relating to the exchange offer AirTran commenced this morning as part of its proposal to combine AirTran with Midwest ("AirTran Holdings Commences Exchange Offer for Midwest Air Group").
The complete text of the letter is set forth below:
January 11, 2007
Board of Directors
c/o Mr. Timothy E. Hoeksema
Chairman, CEO and President
Midwest Air Group Inc
6744 South Howell Avenue
Oak Creek, WI 53154
Dear Members of the Board:
AirTran Holdings, Inc. today is announcing an exchange offer for all of the outstanding shares of Midwest Air Group for $13.25 per share, based on the closing price of AirTran common stock on January 8, 2007. The offer consists of $6.625 in cash and 0.5884 shares of AirTran common stock for each Midwest share. The total equity value of the exchange offer is $345,000,000.
In our October 20, 2006, proposal to you we indicated that we were prepared to enhance the value then offered $11.25 per share for all of Midwest's outstanding shares if you were to permit us to do some limited due diligence to better understand your company. We emphasized that same point when on December 13, 2006, we disclosed our proposal to your shareholders with an expectation that you would permit us to go forward on that basis. Since we have heard nothing from you during the ensuing month, you gave us no choice but to bring our offer directly to the owners of the company.
The decision to take this step and initiate a process that is governed by SEC regulations and a fixed timetable was one that was taken after very careful thought. I should add that the decision to unilaterally increase, by $2 per share, or nearly 18 percent, the consideration we are now willing to pay over the already fair and full offer we first proposed to you on October 20, 2006, (which in itself was a 37 percent premium to the value then being accorded Midwest by the investment community and an 89 percent premium over the six months average price of your company's stock) was also not an easy decision for us to make. However, we are willing to take this step because we fully believe that a combined AirTran and Midwest, whose shareholder base will consist of holders of both of our companies, will generate the value needed to justify our increased offer.
Aside from the financial benefits that we see emanating from this transaction for our respective shareholders, the combination will also provide value to your other stakeholders as well. Namely, a combined AirTran and Midwest will materially expand service to Milwaukee and the other communities that you presently serve and the new company will provide an overall net increase in jobs and bring added job security and growth opportunities to your employees.
Now that we have put into motion a process that has a definite timetable,
we hope we can negotiate a definitive merger agreement. We look forward to
hearing from you shortly.
Yours truly,
Joseph B. Leonard
Chairman and Chief Executive Officer
Thursday January 11, 5:00 am ET
- Enhanced Offer of $13.25 Per Share -
- Represents 61 Percent Premium at Time of Initial Offer -
ORLANDO, Fla., Jan. 11 /PRNewswire-FirstCall/ -- AirTran Holdings, Inc. (NYSE: AAI - News; "AirTran"), the parent company of AirTran Airways, today announced that it has commenced an exchange offer for all of the outstanding shares of Midwest Air Group (Amex: MEH - News; "Midwest"), for $13.25 per Midwest share, based on the closing price of AirTran common stock on January 8, 2007. The offer consists of $6.625 in cash and 0.5884 shares of AirTran common stock for each Midwest share. The total equity value of the exchange offer is $345 million. The offer, which is being made through Galena Acquisition Corp., a wholly owned subsidiary of AirTran, represents a premium of 61 percent over the thirty day average closing price of Midwest common stock at the time of AirTran's initial proposal to acquire all of Midwest's common stock at a price of $11.25 per share on October 20, 2006, and an approximately 46 percent premium over the closing price the day prior to December 13, 2006, the date on which AirTran disclosed its October 20, 2006, offer.
ADVERTISEMENT
"We are committed to bringing these two great airlines together to form an even better airline based on our conviction that it is in the best interests of Midwest and AirTran shareholders, the employees of both companies and the communities the air carriers serve," said Joe Leonard, AirTran Airways' chairman and chief executive officer. "Together, we will be in a stronger position to compete in the changing airline marketplace, to grow underserved cities like Milwaukee and Kansas City, increase employment and advancement opportunities, and to provide our customers with the high quality service they value."
"While we would have wished to enter into negotiations with Midwest's Board and management to consummate a definitive merger agreement, it is clear that they had no intention of doing so. Largely due to the overwhelming support we have received for the combination from Midwest shareholders, employees, customers and the communities Midwest serves, after the disclosure of our October 20th proposal, we decided to bring our offer directly to Midwest's investors," he added.
"It is clear to most stakeholders that AirTran Airways can grow Midwest Airlines, expand the Milwaukee market and add more destinations and service beyond what Midwest can achieve independently. With our fleet commonality, comparable corporate cultures, commitments to quality service and complementary route networks, we are an ideal partner for Midwest," Leonard added.
"We feel so strongly about the merits of this combination that we are enhancing the value in our actual exchange offer despite the already attractive premium and the fact that Midwest has denied our request to review non-public financial and other information. Even with the increase in the price we are offering, we still expect the transaction to be accretive to earnings by the end of the first full year following the close of the transaction and significantly accretive thereafter," Leonard concluded.
AirTran is offering to acquire all of the outstanding shares of Midwest through its newly formed subsidiary, Galena Acquisition Corp., which was organized in connection with this offer. This exchange offer is the first step in AirTran's plan to acquire all of the outstanding shares of Midwest common stock. AirTran intends, promptly after completion of the offer, for Midwest to consummate a second-step merger whereby Midwest common stock would be converted into the right to receive the same number of shares of AirTran common stock and the same amount in cash per Midwest share as paid in the exchange offer.
The exchange offer will be subject to customary conditions, including the tender of a majority of Midwest shares, calculated on a fully diluted basis; redemption of the Midwest rights under its Rights Agreement, commonly known as a poison pill, certain actions to ensure that the Wisconsin control share acquisition statute and business combination statute are not applicable to AirTran following the exchange offer; the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act ("HSR") and certain other regulatory approvals.
The exchange offer is scheduled to expire at 12:00 midnight, New York City time, on February 8, 2007, unless the exchange offer is extended.
Morgan Stanley and Credit Suisse are serving as AirTran's financial advisors and the dealer managers and Smith, Gambrell & Russell, LLP, is serving as AirTran's legal advisor. Innisfree M&A Incorporated is serving as its Information Agent.
Shareholder questions regarding the exchange offer or requests for offering materials should be directed to Innisfree M&A Incorporated at (877) 456-3422. (Banks and Brokers may call collect at 212-750-5833). Offering materials are also available on the SEC's website at http://www.sec.gov. Midwest shareholders are urged to read the offering materials filed by AirTran, which contain important information about the exchange offer.
AirTran executives will be discussing the exchange offer on a Webcast conference call with the investment community at 10:00 a.m. EST/9:00 a.m. CST today, January 11, 2007. To access the Webcast go to http://investor.airtran.com. A replay of the call will be available on the AirTran Airways Web site.
JL's Letter to Midwest
AirTran Chairman and CEO Sends Letter to Board of Directors of Midwest Air Group
ORLANDO, Fla., Jan 11, 2007 /PRNewswire-FirstCall via COMTEX/ -- AirTran Holdings, Inc. (AAI : airtran hldgs inc com
AAI11.92, +0.58, +5.1%) , the parent company of AirTran Airways, announced today that Joe Leonard, AirTran Chairman and Chief Executive Officer, sent a letter to the Board of Directors of Midwest Air Group (MEH : Midwest Express Holdings, Inc. (Wisconsin)
News , chart, profile, more
Last: 12.90+0.80+6.61%
MEH12.90, +0.80, +6.6%) relating to the exchange offer AirTran commenced this morning as part of its proposal to combine AirTran with Midwest ("AirTran Holdings Commences Exchange Offer for Midwest Air Group").
The complete text of the letter is set forth below:
January 11, 2007
Board of Directors
c/o Mr. Timothy E. Hoeksema
Chairman, CEO and President
Midwest Air Group Inc
6744 South Howell Avenue
Oak Creek, WI 53154
Dear Members of the Board:
AirTran Holdings, Inc. today is announcing an exchange offer for all of the outstanding shares of Midwest Air Group for $13.25 per share, based on the closing price of AirTran common stock on January 8, 2007. The offer consists of $6.625 in cash and 0.5884 shares of AirTran common stock for each Midwest share. The total equity value of the exchange offer is $345,000,000.
In our October 20, 2006, proposal to you we indicated that we were prepared to enhance the value then offered $11.25 per share for all of Midwest's outstanding shares if you were to permit us to do some limited due diligence to better understand your company. We emphasized that same point when on December 13, 2006, we disclosed our proposal to your shareholders with an expectation that you would permit us to go forward on that basis. Since we have heard nothing from you during the ensuing month, you gave us no choice but to bring our offer directly to the owners of the company.
The decision to take this step and initiate a process that is governed by SEC regulations and a fixed timetable was one that was taken after very careful thought. I should add that the decision to unilaterally increase, by $2 per share, or nearly 18 percent, the consideration we are now willing to pay over the already fair and full offer we first proposed to you on October 20, 2006, (which in itself was a 37 percent premium to the value then being accorded Midwest by the investment community and an 89 percent premium over the six months average price of your company's stock) was also not an easy decision for us to make. However, we are willing to take this step because we fully believe that a combined AirTran and Midwest, whose shareholder base will consist of holders of both of our companies, will generate the value needed to justify our increased offer.
Aside from the financial benefits that we see emanating from this transaction for our respective shareholders, the combination will also provide value to your other stakeholders as well. Namely, a combined AirTran and Midwest will materially expand service to Milwaukee and the other communities that you presently serve and the new company will provide an overall net increase in jobs and bring added job security and growth opportunities to your employees.
Now that we have put into motion a process that has a definite timetable,
we hope we can negotiate a definitive merger agreement. We look forward to
hearing from you shortly.
Yours truly,
Joseph B. Leonard
Chairman and Chief Executive Officer
