CitationLover
Aw, Nuts!
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i don't know. a friend of a friend is at VA. i will ask and find out.
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Midwest has 4 Interested Buyers
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i don't know. a friend of a friend is at VA. i will ask and find out.
FlyAirtran
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Northwest Airlines may be angling to grab Midwest
By TOM DAYKIN
Milwaukee Journal Sentinel
Published on: 08/09/07
Milwaukee — With a deadline looming, Northwest Airlines Corp. appears to be the most likely challenger to AirTran Holding Inc.'s bid to buy Midwest Air Group Inc.
But industry sources say Midwest Air is more valuable to AirTran, giving it an edge in outbidding Northwest and other prospective buyers.
A sale of Midwest Air could be imminent. AirTran's tender offer expires at midnight Friday night, and Chairman and Chief Executive Officer Joe Leonard has vowed not to renew it when trading resumes Monday morning. Leonard wants a sale agreement by then.
Midwest Air said last week a committee of its directors would discuss a possible sale with AirTran and other prospective bidders. The company said there were four "interested parties."
AirTran and Midwest Air operate similar fleets and have only a handful of overlapping routes. Industry analysts and consultants have cited those factors in arguing that Midwest Air is more valuable to expansion-minded AirTran than any other airline.
Aside from AirTran, some of the prospective bidders are thought to be equity investors whose purchase would allow Midwest Air to become a privately held company. Chairman and CEO Timothy Hoeksema would remain at the helm.
Because an equity buyout requires a high level of debt, and with equity financing sources drying up, Leonard has cast doubts on the likelihood of that scenario.
At least one of the interested parties is another airline, said sources familiar with the situation. And indications are that it's Northwest, said one source who asked not to be identified.
Airline industry consultant Michael Boyd said a Northwest bid against AirTran makes sense.
Northwest, the second-busiest carrier at Milwaukee's Mitchell International Airport, views that city as its turf, said Boyd, who operates Boyd Group Inc., an aviation consulting firm in Evergreen, Colo. He and others said Northwest, with hubs in Minneapolis and Detroit, would buy Midwest Air mainly to prevent AirTran from building a hub in Milwaukee.
Midwest Air, which operates Midwest Airlines and regional carrier Midwest Connect, is the dominant airline at Mitchell International.
"The only way this would make sense for (Northwest) would be to head off new competition from an aggressive, healthy airline like AirTran," said Scott Hamilton, who operates Leeham Co. of Issaquah, Wash.
Representatives from Midwest Air and Northwest declined to comment.
Midwest Air has said the bidding process might not result in the company's sale, but Boyd expects a sale.
Nearly 60 percent of Midwest Air's shares have been pledged by their owners to AirTran's tender offer, Boyd said, and spurning an offer would likely result in shareholder lawsuits. Midwest Air's nine-member board, which includes three members nominated by AirTran and elected in June, wants to avoid litigation, he said.
AirTran's cash and stock offer is valued at $15.44 a share, based on Thursday's closing stock price of $11.02 for AirTran. That's a 6.3 percent premium to Midwest Air's stock price of $14.52. Midwest Air's price was $9.08 a share on Dec. 12, the day before AirTran announced its interest in the company.
Leonard says AirTran would replace most of Midwest Airlines' wide, two-by-two seats with narrower seats, boosting the amount of revenue generated by each flight. AirTran also would slash fares to draw more passengers, including those from northern Illinois who now fly out of Chicago.
Milwaukee would function as a second hub for AirTran, which uses Atlanta for 68 percent of its departing flights. With the airlines merged, 46 percent of AirTran's departures would be from Atlanta, with 25 percent of departures from Milwaukee.
"For Northwest, with a dominant position in Minneapolis-St. Paul and Detroit, there is no strategic value in Milwaukee, just a defensive one," said Kevin Healy, AirTran vice president of planning. Northwest, he said, would "only need to maintain enough service to prevent other competition," and would likely reduce service out of Mitchell International.
Northwest offered 38 daily flights from Milwaukee to 13 cities in the summer of 2005 as it tried to take market share from Midwest Airlines. But that strategy failed, and Northwest began dropping flights as it entered Chapter 11 bankruptcy in the fall of 2005. It now offers 15 daily nonstop departures to the airline's hubs in Minneapolis, Detroit and Memphis.
Northwest, which emerged from Chapter 11 in May, has been troubled this summer with a spike in canceled flights because the airline didn't have enough pilots.
Northwest said it plans to hire 250 to 350 new pilots within the next year. Also, Northwest has recalled nearly 400 furloughed pilots.
By TOM DAYKIN
Milwaukee Journal Sentinel
Published on: 08/09/07
Milwaukee — With a deadline looming, Northwest Airlines Corp. appears to be the most likely challenger to AirTran Holding Inc.'s bid to buy Midwest Air Group Inc.
But industry sources say Midwest Air is more valuable to AirTran, giving it an edge in outbidding Northwest and other prospective buyers.
A sale of Midwest Air could be imminent. AirTran's tender offer expires at midnight Friday night, and Chairman and Chief Executive Officer Joe Leonard has vowed not to renew it when trading resumes Monday morning. Leonard wants a sale agreement by then.
Midwest Air said last week a committee of its directors would discuss a possible sale with AirTran and other prospective bidders. The company said there were four "interested parties."
AirTran and Midwest Air operate similar fleets and have only a handful of overlapping routes. Industry analysts and consultants have cited those factors in arguing that Midwest Air is more valuable to expansion-minded AirTran than any other airline.
Aside from AirTran, some of the prospective bidders are thought to be equity investors whose purchase would allow Midwest Air to become a privately held company. Chairman and CEO Timothy Hoeksema would remain at the helm.
Because an equity buyout requires a high level of debt, and with equity financing sources drying up, Leonard has cast doubts on the likelihood of that scenario.
At least one of the interested parties is another airline, said sources familiar with the situation. And indications are that it's Northwest, said one source who asked not to be identified.
Airline industry consultant Michael Boyd said a Northwest bid against AirTran makes sense.
Northwest, the second-busiest carrier at Milwaukee's Mitchell International Airport, views that city as its turf, said Boyd, who operates Boyd Group Inc., an aviation consulting firm in Evergreen, Colo. He and others said Northwest, with hubs in Minneapolis and Detroit, would buy Midwest Air mainly to prevent AirTran from building a hub in Milwaukee.
Midwest Air, which operates Midwest Airlines and regional carrier Midwest Connect, is the dominant airline at Mitchell International.
"The only way this would make sense for (Northwest) would be to head off new competition from an aggressive, healthy airline like AirTran," said Scott Hamilton, who operates Leeham Co. of Issaquah, Wash.
Representatives from Midwest Air and Northwest declined to comment.
Midwest Air has said the bidding process might not result in the company's sale, but Boyd expects a sale.
Nearly 60 percent of Midwest Air's shares have been pledged by their owners to AirTran's tender offer, Boyd said, and spurning an offer would likely result in shareholder lawsuits. Midwest Air's nine-member board, which includes three members nominated by AirTran and elected in June, wants to avoid litigation, he said.
AirTran's cash and stock offer is valued at $15.44 a share, based on Thursday's closing stock price of $11.02 for AirTran. That's a 6.3 percent premium to Midwest Air's stock price of $14.52. Midwest Air's price was $9.08 a share on Dec. 12, the day before AirTran announced its interest in the company.
Leonard says AirTran would replace most of Midwest Airlines' wide, two-by-two seats with narrower seats, boosting the amount of revenue generated by each flight. AirTran also would slash fares to draw more passengers, including those from northern Illinois who now fly out of Chicago.
Milwaukee would function as a second hub for AirTran, which uses Atlanta for 68 percent of its departing flights. With the airlines merged, 46 percent of AirTran's departures would be from Atlanta, with 25 percent of departures from Milwaukee.
"For Northwest, with a dominant position in Minneapolis-St. Paul and Detroit, there is no strategic value in Milwaukee, just a defensive one," said Kevin Healy, AirTran vice president of planning. Northwest, he said, would "only need to maintain enough service to prevent other competition," and would likely reduce service out of Mitchell International.
Northwest offered 38 daily flights from Milwaukee to 13 cities in the summer of 2005 as it tried to take market share from Midwest Airlines. But that strategy failed, and Northwest began dropping flights as it entered Chapter 11 bankruptcy in the fall of 2005. It now offers 15 daily nonstop departures to the airline's hubs in Minneapolis, Detroit and Memphis.
Northwest, which emerged from Chapter 11 in May, has been troubled this summer with a spike in canceled flights because the airline didn't have enough pilots.
Northwest said it plans to hire 250 to 350 new pilots within the next year. Also, Northwest has recalled nearly 400 furloughed pilots.
SkiFishFly
Well-known member
- Joined
- Mar 22, 2005
- Posts
- 779
Propsync
Everybody to the limit!
- Joined
- Mar 29, 2004
- Posts
- 722
You've been wearing that foil hat again, haven't you?
Last I checked Northwest Airlines has the highest profit margin of any U.S. Airline at 7.2%. Air Trans profit margin is only 2.7%.
http://www.bts.gov/press_releases/2007/bts029_07/html/bts029_07.html
MarineGrunt
Will kill for peace.
- Joined
- Sep 18, 2002
- Posts
- 1,854
CitationLover
Aw, Nuts!
- Joined
- Feb 26, 2003
- Posts
- 3,316
it's amazing what can happen when you use the american taxpayer to rape and pillage your employees.
Schwanker
Well-known member
- Joined
- Dec 17, 2001
- Posts
- 486
Did you loan them that nickel? If not, who's the "passive" investor JL is referring to, the one with anti-trust issues? I can only think of one, but what do I know.
Schwanker
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