Limeyflyer
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News Release
Pinnacle Airlines Corp. Acquires Mesaba Aviation, Inc.
Pinnacle Airlines Corp. Acquires Mesaba Aviation, Inc.
Combined organization ‘well positioned to be a major competitive player for the long term’
MEMPHIS, Tenn – July 1, 2010 – Pinnacle Airlines Corp. (NASDAQ: PNCL) (the “Company”)
announced today that it has acquired Mesaba Aviation, Inc. from Delta Air Lines (NYSE: DAL),
for $62 million.
Previously a wholly owned subsidiary of Delta, Mesaba operates a fleet of 92 regional aircraft as
a Delta Connection carrier, and is one of the largest operators of Bombardier CRJ-900 aircraft in
the world. The acquisition enhances the Company’s position as one of the nation’s pre-eminent
independent regional airline companies.
“This transaction brings together very strong and very similar organizations,” said Phil Trenary,
the Company’s President and Chief Executive Officer. “Together, we will be even stronger, well
positioned to be a major competitive player for the long term.”
Trenary added, “Even as long-time competitors, Pinnacle and Mesaba have always had
tremendous respect for one another. We have comparable values and goals, built around
safety, respect for our people, customer service and operational excellence. We have very
similar fleets of regional jets and turboprops, and we fly complementary routes with schedules
that are already integrated as part of Delta Connection.”
Founded in 1944, Mesaba is the longest-flying regional airline in the United States. It will
remain headquartered in Eagan, Minn., under its current management team.
“We at Mesaba are excited about this partnership and the opportunities that it can provide,” said
Mesaba President John Spanjers. “Pinnacle is no longer a competitor but a partner that shares
our common goal of success and offers growth opportunities with other major carriers.”
Pinnacle Airlines, Inc. (“Pinnacle”), the Company’s regional jet operating subsidiary, also
operates as a Delta Connection carrier. In addition, the Company’s Colgan Air subsidiary
operates turboprop regional service for Continental Airlines, United Air Lines and US Airways,
minimizing the Company’s dependence on any single partner.
The total fleet consists of 202 regional jets – 57 76-passenger Bombardier CRJ-900 and 145
50-passenger Bombardier CRJ-200 – and 80 turboprops, consisting of 14 74-passenger
Bombardier Q400 and 66 34-passenger Saab SF340. The Company also has 15 firm orders for
new Q400 NextGen aircraft, with deliveries starting in August, and purchase options for an
additional 30.
Under the terms of the transaction, the Company and Delta established a new, 12-year capacity
purchase agreement effective July 1, 2010, for the operation of Mesaba’s CRJ-900 fleet. This
new CRJ-900 agreement is structured similarly to Pinnacle’s existing agreements with Delta,
announced today that it has acquired Mesaba Aviation, Inc. from Delta Air Lines (NYSE: DAL),
for $62 million.
Previously a wholly owned subsidiary of Delta, Mesaba operates a fleet of 92 regional aircraft as
a Delta Connection carrier, and is one of the largest operators of Bombardier CRJ-900 aircraft in
the world. The acquisition enhances the Company’s position as one of the nation’s pre-eminent
independent regional airline companies.
“This transaction brings together very strong and very similar organizations,” said Phil Trenary,
the Company’s President and Chief Executive Officer. “Together, we will be even stronger, well
positioned to be a major competitive player for the long term.”
Trenary added, “Even as long-time competitors, Pinnacle and Mesaba have always had
tremendous respect for one another. We have comparable values and goals, built around
safety, respect for our people, customer service and operational excellence. We have very
similar fleets of regional jets and turboprops, and we fly complementary routes with schedules
that are already integrated as part of Delta Connection.”
Founded in 1944, Mesaba is the longest-flying regional airline in the United States. It will
remain headquartered in Eagan, Minn., under its current management team.
“We at Mesaba are excited about this partnership and the opportunities that it can provide,” said
Mesaba President John Spanjers. “Pinnacle is no longer a competitor but a partner that shares
our common goal of success and offers growth opportunities with other major carriers.”
Pinnacle Airlines, Inc. (“Pinnacle”), the Company’s regional jet operating subsidiary, also
operates as a Delta Connection carrier. In addition, the Company’s Colgan Air subsidiary
operates turboprop regional service for Continental Airlines, United Air Lines and US Airways,
minimizing the Company’s dependence on any single partner.
The total fleet consists of 202 regional jets – 57 76-passenger Bombardier CRJ-900 and 145
50-passenger Bombardier CRJ-200 – and 80 turboprops, consisting of 14 74-passenger
Bombardier Q400 and 66 34-passenger Saab SF340. The Company also has 15 firm orders for
new Q400 NextGen aircraft, with deliveries starting in August, and purchase options for an
additional 30.
Under the terms of the transaction, the Company and Delta established a new, 12-year capacity
purchase agreement effective July 1, 2010, for the operation of Mesaba’s CRJ-900 fleet. This
new CRJ-900 agreement is structured similarly to Pinnacle’s existing agreements with Delta,
2
providing for targeted levels of performance and profitability. Mesaba will continue to sublease
its fleet of CRJ-900 aircraft from Delta for the 12-year term of the related capacity purchase
agreement.
Mesaba’s CRJ-200 operations will be governed under Pinnacle’s current Airline Services
Agreement with Delta, which runs through 2017. In addition, the Company and Delta entered
into a separate, short-term capacity purchase agreement providing for the operation of
Mesaba’s Saab 340B+ fleet until they are removed from Delta Connection service in late 2011
under Delta’s previously announced retirement program.
“We have further solidified our future with Delta, which has previously signaled its desire to work
with a smaller number of strong regional partners,” said Trenary. “We also have additional
opportunities to grow with the ‘right’ product offering – a full spectrum of regional jets and
turboprops. As we grow, our emphasis will be on expanding our existing fleets of CRJ-900 and
Q400 aircraft, the most cost-effective and fuel-efficient aircraft types within their respective
classes – and what our airline partners are demanding.”
With total employment of approximately 7,700, the Company will continue to operate three
subsidiaries – Pinnacle Airlines, inc., Colgan Air, inc. and Mesaba Aviation, inc.
“Over the longer term, we anticipate that we can enhance efficiency and growth opportunities for
our airlines and our people by reorganizing around two operating airlines,” said Trenary. “Our
intent is to combine the regional jets under Pinnacle Airlines and the turboprops under Mesaba
Aviation. However, there are many complex issues to be addressed, and this will take time.”
The Company will hold a webcast for investors today at 9 a.m. CT to provide additional details
about the transaction. Interested parties may access the webcast at
its fleet of CRJ-900 aircraft from Delta for the 12-year term of the related capacity purchase
agreement.
Mesaba’s CRJ-200 operations will be governed under Pinnacle’s current Airline Services
Agreement with Delta, which runs through 2017. In addition, the Company and Delta entered
into a separate, short-term capacity purchase agreement providing for the operation of
Mesaba’s Saab 340B+ fleet until they are removed from Delta Connection service in late 2011
under Delta’s previously announced retirement program.
“We have further solidified our future with Delta, which has previously signaled its desire to work
with a smaller number of strong regional partners,” said Trenary. “We also have additional
opportunities to grow with the ‘right’ product offering – a full spectrum of regional jets and
turboprops. As we grow, our emphasis will be on expanding our existing fleets of CRJ-900 and
Q400 aircraft, the most cost-effective and fuel-efficient aircraft types within their respective
classes – and what our airline partners are demanding.”
With total employment of approximately 7,700, the Company will continue to operate three
subsidiaries – Pinnacle Airlines, inc., Colgan Air, inc. and Mesaba Aviation, inc.
“Over the longer term, we anticipate that we can enhance efficiency and growth opportunities for
our airlines and our people by reorganizing around two operating airlines,” said Trenary. “Our
intent is to combine the regional jets under Pinnacle Airlines and the turboprops under Mesaba
Aviation. However, there are many complex issues to be addressed, and this will take time.”
The Company will hold a webcast for investors today at 9 a.m. CT to provide additional details
about the transaction. Interested parties may access the webcast at
www.PNCL.com, the
Company’s Web site.
“As the industry continues to consolidate at both the major and regional carrier levels, we have
solidly established ourselves as a strong, independent regional airline corporation,” said Trenary.
“We are well positioned to succeed and grow, which will provide growth in jobs, growth
opportunities for our people and increased value for our shareholders.”
# # #
Company’s Web site.
“As the industry continues to consolidate at both the major and regional carrier levels, we have
solidly established ourselves as a strong, independent regional airline corporation,” said Trenary.
“We are well positioned to succeed and grow, which will provide growth in jobs, growth
opportunities for our people and increased value for our shareholders.”
# # #
3
About Pinnacle Airlines Corp.
Pinnacle Airlines Corp. (NASDAQ: PNCL), an airline holding company, is the parent company of
Pinnacle Airlines, Inc.; Colgan Air, Inc.; and Mesaba Aviation, Inc. Pinnacle Airlines, Inc.
operates a fleet of 142 regional jets under Delta brands in the United States, Canada, the
Bahamas, Mexico, U.S. Virgin Islands, and Turks and Caicos Islands. Colgan Air, Inc. operates
a fleet of 48 regional turboprops as Continental Connection, United Express and US Airways
Express. Mesaba, also a Delta Connection carrier, operates an advanced fleet of regional jet
and jet-prop aircraft. The corporate headquarters is located in Memphis, Tenn. Airport hub
operations are located in Atlanta, Boston, Detroit, Newark, Washington Dulles, Houston,
Memphis, Minneapolis and Salt Lake City. Visit www.pncl.com for more information.
This press release contains various forward-looking statements based on management's beliefs,
as well as assumptions made by and information currently available to management. Although
the Company believes that the expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have been correct.
Such statements are subject to certain risks, uncertainties and assumptions, including those set
forth in our filings with the Securities and Exchange Commission, which are available to
investors at our web site or online from the Commission. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove erroneous, actual results may
vary materially from results that were anticipated or projected. The Company does not intend to
update these forward-looking statements before its next required filing with the Securities and
Exchange Commission.
Contact:
JoePinnacle Airlines, Inc.; Colgan Air, Inc.; and Mesaba Aviation, Inc. Pinnacle Airlines, Inc.
operates a fleet of 142 regional jets under Delta brands in the United States, Canada, the
Bahamas, Mexico, U.S. Virgin Islands, and Turks and Caicos Islands. Colgan Air, Inc. operates
a fleet of 48 regional turboprops as Continental Connection, United Express and US Airways
Express. Mesaba, also a Delta Connection carrier, operates an advanced fleet of regional jet
and jet-prop aircraft. The corporate headquarters is located in Memphis, Tenn. Airport hub
operations are located in Atlanta, Boston, Detroit, Newark, Washington Dulles, Houston,
Memphis, Minneapolis and Salt Lake City. Visit www.pncl.com for more information.
This press release contains various forward-looking statements based on management's beliefs,
as well as assumptions made by and information currently available to management. Although
the Company believes that the expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have been correct.
Such statements are subject to certain risks, uncertainties and assumptions, including those set
forth in our filings with the Securities and Exchange Commission, which are available to
investors at our web site or online from the Commission. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove erroneous, actual results may
vary materially from results that were anticipated or projected. The Company does not intend to
update these forward-looking statements before its next required filing with the Securities and
Exchange Commission.
Contact:
