Here's why Midwest wouldn't sell to Airtran

[Flydaplane]

Midwest Airlines' recent sale to investment firm TPG Capital will result in hefty payouts of stock and cash to carrier executives, the Associated Press reported. Chairman Tim Hoeksema reportedly will receive more than $10 million in cash and stock while VPs Carole Skornicka and David Reeve are in line for $1.6 million each. CFO Curtis Sawyer and VP Scott Dickson will receive about $1 million each. Northwest Airlines is the largest shareholder in the TPG acquisition.

I bet the Midex union guys sure are happy they opposed the Airtran deal now. They played you boys bad! And they even tried to get concessions out of you for their own golden parachutes.

 

[CitationLover]

Midwest Airlines' recent sale to investment firm TPG Capital will result in hefty payouts of stock and cash to carrier executives, the Associated Press reported. Chairman Tim Hoeksema reportedly will receive more than $10 million in cash and stock while VPs Carole Skornicka and David Reeve are in line for $1.6 million each. CFO Curtis Sawyer and VP Scott Dickson will receive about $1 million each. Northwest Airlines is the largest shareholder in the TPG acquisition.

I bet the Midex union guys sure are happy they opposed the Airtran deal now. They played you boys bad! And they even tried to get concessions out of you for their own golden parachutes.

do you not understand anything with which you are typing? if air tran bought us they would have gotten air tran's money for their stock ($10) and air tran stock on top of that. every stockholder (not just the executives) is getting their midwest shares bought (air tran or tpg).

 

[Captainjerky]

Sellout

do you not understand anything with which you are typing? if air tran bought us they would have gotten air tran's money for their stock ($10) and air tran stock on top of that. every stockholder (not just the executives) is getting their midwest shares bought (air tran or tpg).

I think what Flydaplane was saying is that Uncle Timmy sold out all the Midwest employees. Instead of entertaining the Airtran offer, according to the Urinal Sentinel he approached Northwest a while back to ask about them buying into Midwest. Now Midwest employees get to spend the next couple years worrying what Northwest will do to them once TPG sells...
Just MY take on it, you understand, but it's hard to not see this as Northwest's backdoor purchase of an airline that's caused them problems for years. The concern is what happens to all those loyal and long term employees once Northwest gets their hands on the company.

 

[ultrarunner]

Actually, the TPG deal IS a better deal for the shareholders as it's "cash-in-hand" deal. The AAI offer was cash-stock deal. CASH is king, and in the TPG deal, the shareholder now has the flexibility to invest as s/he sees fit.

I'd have take 16 bucks cash any day for that stock, vs. the AAI offer.

Folks keep thinking that that deals like this need to put the employees first...and those folks don't understand how the system works. SHAREHOLDERS come first folks, that's the bottom line.

 

[MGT3]

How many DC-9s does NWA have versus Medex's 717s?

The good news is that DET and MSP arn't that far of a commute from MKE.

 

[ultrarunner]

How many DC-9s does NWA have versus Medex's 717s?

Hard to say as I'm not sure of NWA's retirement sched....but someone will chime in to correct me.

I think as of this past year, NWA has 150 or so DC 9's in service.

MidEx has 25 717's.

 

[CitationLover]

I think what Flydaplane was saying is that Uncle Timmy sold out all the Midwest employees. Instead of entertaining the Airtran offer, according to the Urinal Sentinel he approached Northwest a while back to ask about them buying into Midwest. Now Midwest employees get to spend the next couple years worrying what Northwest will do to them once TPG sells...
Just MY take on it, you understand, but it's hard to not see this as Northwest's backdoor purchase of an airline that's caused them problems for years. The concern is what happens to all those loyal and long term employees once Northwest gets their hands on the company.

i am sure the continental and america west people (whom nwa did this exact same thing to) are worrying about that stuff now.

they'd be worrying if it was air tran too on the buying end. we shall wait and see regarding NWA involvement. TPG's history has shown Tim has a short amount of time to make things looking better or he will be gone.

 

[CitationLover]

I'd have take 16 bucks cash any day for that stock, vs. the AAI offer.

Folks keep thinking that that deals like this need to put the employees first...and those folks don't understand how the system works. SHAREHOLDERS come first folks, that's the bottom line.

it was $17/share i believe in the end.

wisconsin state law requires STAKEHOLDERS (not shareholders but employees, etc.) to be considered in a takeover. this law was what was holding air tran up from simply buying shares on the open market as it contained some defense mechanisms a company could use.

 

[Britpilot]

i am sure the continental and america west people (whom nwa did this exact same thing to) are worrying about that stuff now.

.

Continental bought out of NWA as soon as they could. They called it "Independence Day" at CAL. Cost CAL a lot of cash but they wanted out of NWA's grasp as soon as possible.
Good luck.

 

[CitationLover]

Continental bought out of NWA as soon as they could. They called it "Independence Day" at CAL. Cost CAL a lot of cash but they wanted out of NWA's grasp as soon as possible.
Good luck.

my understanding was they both own 15% of each other. is this not the case anymore?

 

[Schwanker]

Continental bought out of NWA as soon as they could. They called it "Independence Day" at CAL. Cost CAL a lot of cash but they wanted out of NWA's grasp as soon as possible.
Good luck.

They're still not completely out of NWA control as NWA still has the "golden share." This could cost a very shiny penny to buy back if consolidation hits.

Schwanker

 

[Britpilot]

They're still not completely out of NWA control as NWA still has the "golden share." This could cost a very shiny penny to buy back if consolidation hits.

Schwanker

That is true, I forgot about that.

 

[Britpilot]

my understanding was they both own 15% of each other. is this not the case anymore?

Never heard that one before.

 

[DH106]

Getting back to Uncle Tim getting rich, he disgusts me. He fired and furloughed hundreds of people, and now he's rewarding himself with $10 million. The man is disgusting... if you can call him a man.

 

[CitationLover]

Getting back to Uncle Tim getting rich, he disgusts me. He fired and furloughed hundreds of people, and now he's rewarding himself with $10 million. The man is disgusting... if you can call him a man.

anyone who owned stock is getting money. tim didn't issue more stock strictly for himself.

 

[RVSM]

Folks keep thinking that that deals like this need to put the employees first...and those folks don't understand how the system works. SHAREHOLDERS come first folks, that's the bottom line.

And look how that it working out for America as a whole.

 

[Propsync]

anyone who owned stock is getting money. tim didn't issue more stock strictly for himself.

I think you missed what DH106 was trying to say. Tim mismanaged Midwest wonderfully to a point where they had to sell to somebody. The cash was better for the shareholders, management included. If the sale was to Airtran, I don't know if management's shares would have a vesting period or not. I think 106's point was Tim's getting 10 millon cash for being a complete f-up.

I'm really curious what TPG will do here. This deal is so overpriced, I don't know how they can possibly put any more into Midwest and get any decent return on the investment. The murder that Skywest alone is doing to the RASM/CASM on the connect side is shocking. I'd guess as soon as Skyway can get out of the EAS, they'll be gone. I just don't see anything else but Northwest taking over and putting 170/5's (whichever was ordered) and 900's to replace the 717 fleet. My worst fear is a staple/furlough/J4J to Compass/Mesaba. Some body tell me this will work out any better than this.

 

[CitationLover]

I think you missed what DH106 was trying to say. Tim mismanaged Midwest wonderfully to a point where they had to sell to somebody. The cash was better for the shareholders, management included. If the sale was to Airtran, I don't know if management's shares would have a vesting period or not. I think 106's point was Tim's getting 10 millon cash for being a complete f-up.

I'm really curious what TPG will do here. This deal is so overpriced, I don't know how they can possibly put any more into Midwest and get any decent return on the investment. The murder that Skywest alone is doing to the RASM/CASM on the connect side is shocking. I'd guess as soon as Skyway can get out of the EAS, they'll be gone. I just don't see anything else but Northwest taking over and putting 170/5's (whichever was ordered) and 900's to replace the 717 fleet. My worst fear is a staple/furlough/J4J to Compass/Mesaba. Some body tell me this will work out any better than this.

with Air Tran a change in control in management would have happened and then their "golden parachutes" would have kicked in and thus Tim would have gotten MORE (a change in control would immediately vest any outstanding shares, etc for mgmt personnel, its part of their poison pill). i think it was more pride in Tim's part for not wanting the Air Tran deal to go through. as far as his "mismanaging" did anybody manage their airline well post 9/11 that had been around for 20 years or more? make no mistake, he doesn't perform, he will be gone according to TPG's past history.

as far as growth, they will get 12.5% growth strictly via the 717 new seating configuration without spend that much money. we shall see what will replace the MD80.

i don't buy a staple to compass. has any airline that american bought stapled to eagle's list? no. it will work out better than you think.

to me the worst thing of this deal is still the uncertainty. with the contract entering negotiations in 2008 i am sure we will use some bargaining capital on mergers and acquisitions that we could have used on getting back some of the concessions.

all this and the bears are 1-3 and the packers are undefeated............