More merger news....

[SKLJ]

Or maybe his form of Tourette's makes him shout "merger" instead of "Ballsack!"

Now that's funny.

 

[whatitdoing?]

What does their "golden share" mean?

 

[Frank Lorenzo]

What does their "golden share" mean?

It is the term coined by NWA's HR department to describe the program that Execs use on how to deal with employees.

I could be wrong. I think the name for that program may actually be "Golden Shower."

 

[NuGuy]

What does their "golden share" mean?

The "golden share" refers to NWA's preferred stock holding in CAL. After the DOJ got involved after NWA's "virtual takeover" in 1998, the stock had to be re-worked to their satisfaction.

Much of the common stock holding was sold off, but NWA retains a "golden share" of preferred stock that allows them certain aquistion rights as well as the ability to block certain corporate transactions, such as mergers. It was a way to protect the marketing arrangement, as well as keep their foot in the door should a full blown aquisition scenario arise.

In other words, should UAL come knocking at CALs door, they'd have to payoff the honchos in Eagan first.

Conservative estimates place the value of this at something north of 1 billion dollars.

Nu

 

[Twotter Driver]

If CAL comes knocking at UAL's door ( i.e. CAL initiates the merger), then the golden share does not apply. It only applies if other airlines try to aquire CAL - kind of a deal spoiler.

 

[Occam's Razor]

If CAL comes knocking at UAL's door ( i.e. CAL initiates the merger), then the golden share does not apply. It only applies if other airlines try to aquire CAL - kind of a deal spoiler.

You're wrong.

100%

Two of the six restrictions block it.

 

[Twotter Driver]

You're wrong.

100%

Two of the six restrictions block it.

Maybe it was explained to me wrong then. If so, my apologies. What are the two restrictions you are talking about? To my knowledge the golden share does not apply if CAL is the one acquiring another carrier. It does however apply if CAL is acquired.

 

[Twotter Driver]

This was copied from a past article in the WSJ and is consistent with what I posed as well as with what Jeff and Larry stated regarding the golden share.

How would NWA's 'golden share' complicate a Continental merger?
From The Wall Street Journal (subscription required): The preliminary talks on merging United Airlines and Continental, the nation's second- and fifth-largest airlines, respectively, have run into several vexing issues, including what to do about the "golden share" that Northwest Airlines Corp. holds in Continental, which could complicate any deal Continental might attempt, the people familiar with the matter said. Northwest's golden share is a special voting series of Continental preferred stock it owns in connection with its marketing alliance with Continental, which runs through 2025. Northwest could use those shares to block a merger of Continental with another major airline -- if the combination required a vote by Continental shareholders. Even with the golden share in place, however, Continental could buy another airline without interference from Northwest if that transaction didn't require Continental shareholders' approval.

 

[Turtle21]

Can't take credit for the avitar. It was made by another AWA pilot (oddly, he is a former AAA pilot!!). Regards.

Former AAA pilot... Didn't have to tell us that. It was obvious. Ask him about the AAA pilots in his AAA class, and how many AAA pilots he leaped over with Nic. It is a good thing he was smart enough to go to AWA.

 

[grog_sit_reserv]

He went to AWA from AAA because he was furloughed from AAA. Guess he should have waited around and let a promising job at a growing carrier pass him by so that he could go back to AAA and be a self righteous doo dad like you.