Midwest/TPG/NWA deal is up in the air

[CitationLover]

the price being paid for midwest stock is waaaaaaaaaaayyyyy over valued. The price for the stock should be 3-4 bucks a share. I think that the parties will/should renig on this deal because of the rediculus premium being paid for this dog. talk about a waste of dollars. If lufthanza bought 20% of Jetblue for 300 million. How could this group justify close to 700 million for a tiny co. like midwest? which owns very little assets and very few resources? it looks like its mostly set up to get the management and bankers rich. but whats new anyway.

where are you getting $700 million?!?! you're about $250 million off.

 

[Eagle757shark]

If they won't let this go through then a NWA/DAL merger is even less likely.

I do think large mergers between legacies will have a hard time with the DOJ, but they can be done. The DOJ usually has guidelines by which the parties involved must meet to get their blessing. All this chatter could be a screen for what is really going on, mergers on a smaller scale. Example: Delta and Alaska, United and Jetblue, Continental and AirTran, Spirit and Frontier. Many scenarios could play out. I think next year this time we all will be shaking our heads one way or the other saying, "damn, where did that come from"!

 

[airline#5]

There will be no mergers, too many hurtles. There will continue to be people discussing mergers, however.

 

[Eagle757shark]

There will be no mergers, too many hurtles. There will continue to be people discussing mergers, however.

The airline industry will go down the same road as the banking industry, the phone industry, oil companies, and soon to be auto industry. In a global economy it is only a matter of time. Over the last seven years the legacy carriers have spent time trying to get their books in order. Now that they are profitable they need to figure out how to stay profitable. Consolidation makes sense for one reason alone, being able to control pricing power. With energy prices as high as they are and the stock of many of the low cost carriers taking a beating, the time could be right for the legacies to step in and grab a good deal. If you folks have a chance, go to the book store and pickup the latest Airways magazine. There is a very good article on the path of low cost carriers vs legacy carriers. If you go on the internet today and look up fares for flights between the established low cost carriers (Southwest, AirTran, Jetblue, Frontier) you will find that their pricing is not to far from the legacies on many routes. The difference between today and years past, the legacies were loosing money and the low cost carriers were making money on competitive routes. This is not the case today. The low cost advantage is no more, which will eventually drive these forseeable mergers.

 

[gt1900]

Heres my thoughts.. If the TPG/NWA deal doesn't go through, then MEH stock is going to plummet to around $4 or $5 a share. If that happens I can almost guarantee AAI will come back with an offer of about $8-$10 a share. Now that shareholders have seen that MEH's stand alone plan is not going to work, I would bet that inverstors would gladly sell to AAI for much less than originaly offered. Currently, with $100 a barel oil, the airline industry is a whole different animal than it was 6 months ago, when profits were skyrocketing. This could be a great deal for AAI.. But then again, what the he11 do I know. It isn't too far fetched though..

 

[flying zephyr]

sum of parts greater than the whole

I think that the deal would be for 455 mil. Buying part of an airline like lufthansa is doing is a lot different than the whole thing. Landing slots at DCA, LGA, gates at airports, trained "professionals", pilot training, cheap leases on the a/c, the "brand" fwiw, they all add up to something, and let's not forget 50 odd mil is going to golden parachutes with vesting, payouts and all the other crap that goes along with them. I agree, they could've gotten MW on the cheap if IF IF negotiations were going on now, but then again I could've sold my house for a lot more two years ago than what it's worth now... When you make the deal has a lot to do with it and TPG would have a lot of egg on thier face to back out, just because times are different. Do you think that thier people would be happy to walk away throwing 15 mil or whatever thier fee is down the crapper if they know that NWA is going to buy them off anyway. Remember the JD is already looking at this as if it is a merger and if you look at NWAs latest inflight magazine it already has all of our MCI and MKE routes on thier route map. What's next, I am sure of one thing, we will only find out after it has already happened. Good luck to all and I hope and pray the industry can recover for everyone's sake. More importantly I hope we all have jobs until we want to end our careers on our terms. I didn't want age 65, but it's here and I hope that it doesn't negatively impact everyone tooooooo much. God bless and happy new year to all

 

[RIDETHELIGHTING]

Heres my thoughts.. If the TPG/NWA deal doesn't go through, then MEH stock is going to plummet to around $4 or $5 a share. If that happens I can almost guarantee AAI will come back with an offer of about $8-$10 a share. Now that shareholders have seen that MEH's stand alone plan is not going to work, I would bet that inverstors would gladly sell to AAI for much less than originaly offered. Currently, with $100 a barel oil, the airline industry is a whole different animal than it was 6 months ago, when profits were skyrocketing. This could be a great deal for AAI.. But then again, what the he11 do I know. It isn't too far fetched though..[/quote/]

I heard that AT would offer about 150-200 mil less

 

[CitationLover]

Heres my thoughts.. If the TPG/NWA deal doesn't go through, then MEH stock is going to plummet to around $4 or $5 a share. If that happens I can almost guarantee AAI will come back with an offer of about $8-$10 a share. Now that shareholders have seen that MEH's stand alone plan is not going to work, I would bet that inverstors would gladly sell to AAI for much less than originaly offered. Currently, with $100 a barel oil, the airline industry is a whole different animal than it was 6 months ago, when profits were skyrocketing. This could be a great deal for AAI.. But then again, what the he11 do I know. It isn't too far fetched though..

let's be honest here at least. the stand alone plan has yet to be fully implemented. our 717 cabins have yet to be reconfigured and won't be until this summer. you're assuming a stand alone plan will fail. the shareholders spoke and voted overwhelmingly to approve the TPG deal.

air tran, loaded with debt, needs to keep growing to maintain that debt. if anything, that debt is at least their shield from an undue takeover. but i doubt this deal will be rejected by the doj so i do not think there will be a chance for a counteroffer. if delta's leadership truly wants to merge with NWA then the full weight of delta's political pull will be on the doj to approve this tiny airline buyout with tpg. i think the reason this is taking a long time is the government is viewing this as a NWA buyout.

 

[CitationLover]

I heard that AT would offer about 150-200 mil less

think about what you are saying. a company with 38 airplanes you are going to pay $250 million dollars for. your company with 130 airplanes is only worth $600 million today. does that make sense?

 

[russtgol]

think about what you are saying. a company with 38 airplanes you are going to pay $250 million dollars for. your company with 130 airplanes is only worth $600 million today. does that make sense?

600 Million is a good deal for Value Jet.. The name of the airline says it all!