MESA/ACA Ain't Gonna Happen!

[Cappy]

For all you Mesa pilots out there with a hardup to merge with ACA I can understand your reasoning:

1. Your contract sucks...no details required

2. You have no understanding as to how terrible your contract is.

3. You are tied to UAL, AWA, and USAir...nothing to be proud of.

4. General Lee is right...ALPA merger policy means DOH and a cursory review of your seniority list means ACA is far better off.

5. The regional aircraft bubble is preparing to pop.


Now, the technical aspects of the offer are different. The offer itself is VERY weak and pretty much a slap in the face from JO.

Consider that 85% of ACA stock is held by institutional investment firms. Let's see, there are two choices:

1. Allow Mesa to by ACA at a very undervalued price and take a one-time gain with VERY high risk OR...

2. Allow ACA management to procede with Goldilocks (LCC Code-name) and risk a long-term gain for the mutual funds that they invest for.

An investment banker I am friends with said it this way "Mesa is the Pinto and ACA is the Ferrari...combine them and you get...two Pintos!"

Our management has already spent many hours and many millions preparing for a UAL separation. It would be of no surprise to see a UAL fingerprint somewhere on this deal.

PLease do not take my comments as disrespectful. I simply want to make sure you understand that we are really two VERY different companies. Just because we both fly RJ's does not mean we are anything alike in spirit.

Chow

 

[ChinaClipper]

WFT,O? I have no desire

nor does ANY YV pilot I know wanting this merger to happen, I know the contract suks, I don't care about who we are associated with, but it appears you have no hostile takeover protection...nothing to be proud of....Is this how you plan to fight JO? If so, I must congradulate you on being the worlds smallest anti-shyster speed bump....... ummm ahhh good luck just the same......

 

[General Lee]

Somebody (Cappy) said I was right for once!! Ah yeah!!!

Bye Bye--General Lee

 

[mckpickle]

Goldilocks...........................Oh come on I've been a MESA basher since day one but if they go with that name........................Heck you might be better off at MESA

 

[Cappy]

Re: WFT,O? I have no desire

nor does ANY YV pilot I know wanting this merger to happen, I know the contract suks, I don't care about who we are associated with, but it appears you have no hostile takeover protection...nothing to be proud of....Is this how you plan to fight JO? If so, I must congradulate you on being the worlds smallest anti-shyster speed bump....... ummm ahhh good luck just the same......

Your statement is incorrect. In a 1998 BOD meeting a "Poison Pill" was adopted to make any takeover attempt, hostile or "bear hug" style, very difficult and expensive. ACA does possess something Mesa needs...cash. We have about $210-$240 mil now and projecting $280-$300 mil by summer of '04.

In the hostile takeover scenario which, by the way, Mesa is not attempting, should the attempt succeed the BOD would not only demand a premium for the stock but any outstanding cash would be paid as a dividend to the shareholders which, at ACA anyway, are 85% or so institutional investment houses.

Although this would be an immediate short-term gain these firms are typically focused on long-term gain over time. It does not make much sense to back Mesa's plan given the fudiciary responsibilities of the institutional investment firms to their shareholders.

By the way, my "nothing to be proud of " was not directed at the Mesa pilots. We at ACA are also not proud to be associated with the big U.

Stay Unified!



One more thing. What is the protection afforded Mesa for a takeover attempt? Just curious.

 

[Cappy]

You're right!

Goldilocks...........................Oh come on I've been a MESA basher since day one but if they go with that name........................Heck you might be better off at MESA

Yes pickleguy I agree! However, the name Goldilocks is the code name that was given for "Project Independence" at the outset. If you can figure out what it means then please let me know!

If I recall my childrens stories correctly I think that Goldilocks entered the three bears home illegally, and stole food, watched cable, drank beer, and then trashed the bedroom before pucking on the middle bears bed...or something like that.

Chow.

 

[mckpickle]

ROTFLMAO

 

[CancelIFR1200]

MESA Might Be slightly more willing for a Hostile Takeover than I thought...........

SAN FRANCISCO (CBS.MW) -- Mesa Air Group said Tuesday that it is willing to take its bid for Atlantic Coast Airlines to the carrier's shareholders if the board decides to reject the more than $500 million stock offer.

"We are prepared to go direct to shareholders," said CEO Jonathan Ornstein during a morning conference call with investors and analysts that followed the company's offer on Monday.

He also said that the company's revenue outlook for 2004 is $975 million, higher than the $871 million consensus revenue estimate from five analysts polled by Reuters Research.

So far, Atlantic Coast's board said late Monday that it was reviewing the deal. The company did not give a time frame for that process. See full story.

Raymond James analyst Jim Parker wrote in a Tuesday research note that he expects the board to reject the offer. "We do not believe ACA's management and board of directors will endorse Mesa's unsolicited offer to combine these companies," he wrote. He added that though Mesa could increase its offer, that would likely be rejected as well.

Ornstein said that the combined company could save more than $200 million but did not expect a push to cut costs that much. He said that rebuilding Atlantic Coast's relationship with United Airlines (UALAQ: news, chart, profile), which is an increasingly important customer for Mesa, would be a priority. Atlantic Coast has been planning to drop its role as a United feeder airline and to start up its own low-fare alternative.

Shares of Atlantic Coast (ACAI: news, chart, profile) rose 83 cents, or 7.5 percent, to $11.88 while Mesa Air Group (MESA: news, chart, profile) rose 69 cents, or 6 percent, to $11.88.

Mesa's all-stock offer would exchange about nine-tenths of a Mesa share for each Atlantic Coast share -- which was a 25 percent premium to Friday's close when the offer first was announced.

"We thought that a 25 percent premium was an attractive offer," said Ornstein.

More M&A

Some analysts expect that the unsolicited deal may represent the beginning of a wave of merger activity in this increasingly important corner of the aviation industry. The largest airlines contract with the smaller carriers to fly routes with smaller prop and jet aircraft, which are more efficient on shorter flights with fewer passengers.

"We have been predicting a consolidation of the regional air industry, and this move may be the beginning of this trend," wrote Ray Neidl, Blaylock & Partners airline stock analyst.

In the case of Mesa and Atlantic, a successful acquisition would almost double the size of the company's fleet. Though there would be a more complex fleet structure when the two are combined, Mesa said that it initially expects to operate the two independently.

August Cole is spot news editor at CBS.MarketWatch.com in San Francisco

 

[WhiteCloud]

Re: You're right!

If I recall my childrens stories correctly I think that Goldilocks entered the three bears home illegally, and stole food, watched cable, drank beer, and then trashed the bedroom before pucking on the middle bears bed...or something like that.
Chow.

Sounds like an appropriate name for an airline project to me.

 

[Carl_Everett]

Re: You're right!

Yes pickleguy I agree! However, the name Goldilocks is the code name that was given for "Project Independence" at the outset. If you can figure out what it means then please let me know!

If I recall my childrens stories correctly I think that Goldilocks entered the three bears home illegally, and stole food, watched cable, drank beer, and then trashed the bedroom before pucking on the middle bears bed...or something like that.

Chow.

I read in some news article that GOLDILOCKS referered to the type of airline they hope to develop. Not too big, not too small, but just right.

 

[Cappy]

Well that is the best guess I've heard yet!

 

[N2264J]

MESA/ACA

Somebody (Cappy) said I was right for once!! Ah yeah!!!

But your not right.

ALPA merger policy does not mean Date of Hire. It establishes a time line where the MECs sit down and negotiate a list.

Three years after the failed PID and you still don't know what
ALPA merger policy says although ASA and Comair pilots kept
repeating it over and over again on this and the ALPA board.

I suspect that among the Delta rank and file, you are not unique. Do you guys still think you can't be whipsawed with a CL-65 because mainline doesn't operate any?

 

[Lancair]

Goldilocks

As far as I know Goldilocks is a generic buisness term. A lot of companys use that name to talk about a new project. It's pretty gay but I'm sure out marketing will come of with something worse than Goldilocks.

 

[Anti-Matter]

We've gone from being the future next Air Tran to being bought out by the slime of the industry.

We are doomed! Doomed I tell ya!

 

[46Driver]

Anti-Matter,
Considering your photo, it should be, "He's dead, Jim!"

 

[hyperboy]

???????????

Cappy? Who do you think you are....... something special? You bore me. If you fly for ACA then why are you worried about mesa? Go whine somewhere else!!!!!!!!

 

[House_X]

We've gone from being the future next Air Tran to being bought out by the slime of the industry.

We are doomed! Doomed I tell ya!

BELAY THAT ORDER!!!!

Stand fast....SHEILDS!!!...Arm all photon torpedoes, ready phasers...JO INTRUDER ALERT...where's Worf when you need em!!!!!!

 

[Jeepman]

Tea.....Earl Grey......HOT!

 

[Cappy]

Re: ???????????

Cappy? Who do you think you are....... something special? You bore me. If you fly for ACA then why are you worried about mesa? Go whine somewhere else!!!!!!!!

I'll answer these questions one at a time:

1. I am not special, although I did receive special schooling as a rowdy teenager

2. I am sorry you are bored. It was not my intention to excite anyone, just to say what's on my mind

3. Yes, I am worried about Mesa. But not too much. As I stated, I beleive the BOD will quickly reject the offer and move forward. My reasons for rejection are listed in the first post.

4. Although not my intention to whine I can whine here if I want.


PLease do not be offended at my comments. They are not meant to slander the Mesa pilots individually. I just say things that I think are factual and that's that!

Later!

 

[46Driver]

Cappy,
The problem - as I understand it - is that Ornstein can take the offer past the BOD and directly to the shareholders. The shareholders can then approve the buyout regardless of the BOD's recommendations.

 

[ChinaClipper]

46Driver....

You sir, are definitely correct. Anyone want to know how JO bought CCAir? Stock swap Anyone want to know how JO intended to buy Mesaba a couple years ago? Stock swap. Anyone want to know how WestAir was bought? hmmmnnnn, ACA stands for Atlantic Coast division of WESTAIR, spooky how history repeats itself ....Chesty Puller would be proud....

 

[Captain X]

ALPA merger policy means DOH

ALPA Merger Policy says nothing of the sort.

G. MERGER NEGOTIATIONS
1. The merger representatives of the affected airlines shall meet and commence efforts to arrive at a mutually satisfactory method of integration and compilation of a single acceptable flight deck crew member seniority list no later than sixty (60) days following the Policy Initiation Date. Similarly, in cases where one or more parties to the merger has flight deck crew members with grandfather or similar special seniority rights that are limited as to job classification or status within the flight deck crew, the merger representatives shall commence efforts to arrive at a mutually satisfactory method of integration and compilation of such separate special seniority lists as may be necessary and appropriate to preserve and protect such rights in addition to the flight deck crew member seniority list. (AMENDED - Executive Board May 1998)

2. Nothing herein shall preclude the assembly of more than one list for each of the above classifications where the transfer of major routes or operating authority will be contingent on proceedings separate from the "instant proceeding" and such known contingencies may warrant the future replacement of one list with another.

3. For the purposes of limiting confrontation and expediting the merger process, the President shall, when he deems advisable, appoint a neutral facilitator to assist the merger representatives in arriving at a fair and equitable solution. It is recommended that outside legal counsel be precluded from direct negotiations until it is agreed that a solution cannot be reached.

4. The first task of the merger representatives shall be to resolve any and all disputes and inconsistencies with regard to the employment data exchanged. The representatives shall be empowered to compromise their differences to the extent necessary to reach agreement except that the relative position of the flight deck crew members on their respective seniority lists shall be maintained. Areas remaining in disagreement shall be reduced to writing, stating the contentions of the parties, and shall be resolved, if necessary, by utilizing the arbitration procedures set forth in Section H. (AMENDED - Executive Board October 1991; Executive Board May 1998)

5. The merger representatives shall carefully weigh all the equities inherent in their merger situation. In joint session, the merger representatives should attempt to match equities to various methods of integration until a fair and equitable agreement is reached, keeping in mind the following goals, in no particular order:

a. Preserve jobs.
b. Avoid windfalls to either group at the expense of the other.
c. Maintain or improve pre merger pay and standard of living.
d. Maintain or improve pre merger pilot status.
e. Minimize detrimental changes to career expectations.

6. The merger representatives shall report to the President, upon request, on their progress once negotiations begin. If, at any time after receiving the first report, in the opinion of the President, satisfactory progress is not being made, he may unilaterally intervene and invoke arbitration. (AMENDED - Executive Board October 1991)

PART 3 - GENERAL
A. ORDER OF MERGED LIST
No integrated list shall be constructed which would change the order of the flight deck crew members on their own respective seniority lists. (AMENDED - Executive Board May 1998)

 

[ALGFLYR]

Atlantic Coast has few takeover defenses to block Mesa Dateline: Wednesday October 08, 2003
Atlantic Coast Airlines Holdings, subject of an unsolicited takeover offer by Mesa Air Group Monday (ATWOnline, Oct. 7), has "extremely weak anti-takeover defenses," according to Credit Suisse First Boston analyst James Higgins.

In a report released yesterday, Higgins noted that ACAH's board of directors stands for election each year and there is no staggered board. Additionally, shareholders "can act by written consent, meaning that a proposal to hold a board election can be taken up at any time." The weak defenses, coupled with a "disgruntled shareholder base that is very skeptical about management's plan" to turn the Regional into a low-cost airline, "make the odds of Mesa's success in an offer quite high," according to Higgins. He also noted that nearly 45% of ACAH shares changed hands shortly after it announced its plan to become a low-fare airline and that another 20% changed hands yesterday. The implication is that a substantial portion of the stock rests with short-term investors interested in an arbitrage play.

Mesa Chairman and CEO Jonathan Ornstein is offering to exchange 0.9 share of newly issued Mesa stock for each share of ACAH common stock. In a briefing to analysts and media yesterday, he said he is prepared to take his offer "directly to Atlantic Coast shareholders." He said he disagrees with ACA's plan to become a standalone low-cost airline and its move in that direction propelled him to make his unsolicited bid. "That model is wrong for this company," he stated. However, he also would prefer to keep the two companies' operations separate.--Perry Flint & Sandra Arnoult

 

[hire_me]

JO is a genious. Mesa has the work. ACA has the airplanes. Mesa wants the airplanes. ACA has no work.

The ACA BOD/shareholders would be foolish to reject this proposal - the likelihood of starting up a successful low-cost carrier is poor to nil.

What's in it for the pilots? Initially a crappy contract. However, this merger will create the largest regional airline in the US. That means negotiating power. Imagine what a strike could do to Mesa down the road - seriously disabling operations at US Airways, United, Frontier and America West.

Genious I say!

 

[NoName]

They have power now, and didnt do anything with it. This is not good for pilots, i dont see how anyone can dispute that.

 

[46Driver]

JO is a genious. Mesa has the work. ACA has the airplanes. Mesa wants the airplanes. ACA has no work.

The ACA BOD/shareholders would be foolish to reject this proposal - the likelihood of starting up a successful low-cost carrier is poor to nil.

What's in it for the pilots? Initially a crappy contract. However, this merger will create the largest regional airline in the US. That means negotiating power. Imagine what a strike could do to Mesa down the road - seriously disabling operations at US Airways, United, Frontier and America West.

Genious I say!

First of all, its "Genius", not "Genious".........

MESA has part of the UAL contract because they bid on lower margins than are sustainable and are tying themselves to the 2 shakiest majors (UAL and USAir). ACA has the airplanes which MESA and UAL need but can not finance. ACA also has the gates at Dulles which MESA and UAL need but don't own. In other words, UAL and MESA are desperate.

The likelihood of starting a LCC is poor to nil? Yeah, just like AirTran and JetBlue. And ACA has more money in the bank than JetBlue when they started plus already having a structure in place.

What's in it for the pilots? To be whipsawed back and forth and forever be stuck with a MESA contract. Great. Pay rates at 20% less than the industry, no commuter clause, per diem at 33% less than the industry, only half pay for being deadheaded, no pay for weather or maintenance cancellations, nice.

 

[stillaboo]

What's in it for the pilots? . . . no commuter clause

They have a commuter clause. It's based on ACA's in fact.

Thes rest of your post, unfortunately, is sortta' true.

 

[46Driver]

ACA's commuter clause can be used at any time. From what I have heard, you can only use the MESA commuter clause once a year.....

 

[Anti-Matter]

ACA's commuter clause can be used at any time. From what I have heard, you can only use the MESA commuter clause once a year.....

And I hear their commute has to arrive 3 hours before their report time.

Way to go Mesa pilots!

 

[Cappy]

Are you serious???

JO is a genious. Mesa has the work. ACA has the airplanes. Mesa wants the airplanes. ACA has no work.

The ACA BOD/shareholders would be foolish to reject this proposal - the likelihood of starting up a successful low-cost carrier is poor to nil.

What's in it for the pilots? Initially a crappy contract. However, this merger will create the largest regional airline in the US. That means negotiating power. Imagine what a strike could do to Mesa down the road - seriously disabling operations at US Airways, United, Frontier and America West.

Genious I say!

You certainly must be joking as your comments lean towards this whole Mesa sideshow as something to be admired!?

Haven't you Mesa guys learned anything about who JO really is? He is Francisco Anthony Lorenzo reborn!!!

Don't know who he is? He whipsawed the Texas Air, Continental, New york Air and Eastern pilots for years until they had enough. The '89 Eastern strike has been misspoken as a pilot strike for years. It was actually a mechanic (IAM) strike...the pilots walked for over NINE MONTHS in sympathy.

Let's be clear, the pilot's were not really sympathetic to the mechanics (which is a long story) but knew that if they did not force Lorenzo out then their careers were over due to the his whipsawing the airlines employee groups.

Do you really beleive that your career is going to be something to be proud of as long as you work for JO?

PLease understand me, I am not blaming the Mesa pilots for anything, yet when I read your posts and your mesa-lounge webboard I am floored by the utter vacuum of information that you guys have. Or maybe it's something much worse, like a group that refuses to hear.

I do wish all Mesa pilots luck with JO and UAL. But ACA management chooses, and the pilots wholeheartedly agree, that staying with UAL has more long-term risks than reward. It's really that simple.

Stay Unified!