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Potential Buyers Have Surfaced for Frontier. Republic stock up 130%

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inflightboi175

Well-known member
Joined
Feb 17, 2009
Posts
151
Feb. 6 (Bloomberg) -- Republic Airways Holdings Inc. has heard from potential buyers for Frontier Airlines and is close to naming an adviser on whether the unit will be sold or spun off to shareholders, Chief Executive Officer Bryan Bedford said.

The company will select Evercore Partners Inc., Barclays Plc or Seabury Group LLC for the advisory role, Bedford said in an interview today. Republic said in November that it would divest Frontier, two years after buying the Denver-based carrier out of bankruptcy.

Separating Frontier will let Republic return to its traditional role of providing regional flights for carriers such as Delta Air Lines Inc. A $120 million restructuring of Frontier that included job cuts and cost reductions has returned the unit to profit, allowing Republic to move ahead with the separation.

“We’ve had a number of calls from potential interested parties, saying ‘When you’re ready to talk we want to talk with you,’” Bedford said. “We haven’t been ready to talk yet.”

Republic shares have more than doubled since Nov. 7, the day before the Indianapolis-based company said it would separate Frontier. They fell 1.4 percent to $6.17 at the close today in New York.

The probability is “fairly low” for a sale of Frontier to a competing “ultra low-cost carrier” such as Allegiant Travel Co., Spirit Airlines Inc. or JetBlue Airways Corp., the CEO said. Bedford declined to say if any of those competitors had expressed an interest in Frontier.

The company doesn’t have “a predisposition on what the right divestiture strategy is,” he said. “With the business producing profits and positive cash flow, we can be deliberate and make sure we’re getting the highest and best outcome, as opposed to feeling the need to rush into something.”

‘Co-Investor’ Option

Republic is willing to be a “co-investor” in Frontier with a private equity group or to do just a partial spinoff to shareholders if needed, Bedford said.

Republic said last month that Frontier may be operating as a separate company in six to 12 months. David Siegel, a Republic director and former US Airways Group Inc. CEO, was named chief executive of Frontier last month. The carrier plans to continue paring costs, and Bedford said he couldn’t rule out additional job cuts “on the edges.” The company in November said it would trim 220 positions in Denver and Milwaukee.

Frontier will take delivery of 80 Airbus SAS neo aircraft that were ordered last year and will be delivered in 2016 through 2020, Bedford said. Republic’s separate order for 40 Bombardier Inc. CSeries aircraft remains intact, even as the airline is worried about the lack of sales for the jet, he said.

Republic is waiting to see whether the CSeries “is ultimately going to be built and delivered, which we believe it will be,” Bedford said. “What’s distressing is that it hasn’t been a particularly strong seller. We have concern about the viability of the project.”

Bombardier has 138 firm orders, 124 options, 10 purchase rights and 45 letters of intent for CSeries planes and has “seen significant progress” in development of the aircraft program, said Marc Duchesne, a spokesman for the Montreal-based company. The plane’s first flight is set for the end of this year, with initial deliveries by the end of 2013, he said.

http://www.businessweek.com/news/20...al-buyers-have-surfaced-for-frontier-air.html

http://online.wsj.com/article/SB10001424052970204136404577207393152341180.html
 
Someone refresh my memory. Did Republic and Frontier merge seniority lists, are there fences, or did they stay separate?

Sent from a dumb phone
 
Republic Airways Holdings Inc. is gearing up to make the pitch that its money-losing Frontier Airlines unit is a good investment.

Chairman and Chief Executive Bryan Bedford said the regional carrier is close to hiring financial advisers to help sell Frontier, which Republic purchased in bankruptcy court in October 2009 and decided to sell two years later.
The Indianapolis-based carrier appointed new management to steer Frontier through the sale and recently achieved $120 million in annual cost savings to make the Denver-based unit more attractive to potential buyers. Frontier is talking to three financial advisers and could have a decision ...
 
Someone refresh my memory. Did Republic and Frontier merge seniority lists, are there fences, or did they stay separate?

Sent from a dumb phone

Yes, the seniority list was arbitrated. Seven year fence. Won't matter after separation, which the article above said is clearly going to happen.
 
Uh Oh...Frontier learned how to be sustainably profitable and is cash flow positive with $120/bbl Brent crude. Its because they are rid of the giant sucking sound, which is the RJ business that was killing them. AMFs!!!
 
Uh Oh...Frontier learned how to be sustainably profitable and is cash flow positive with $120/bbl Brent crude. Its because they are rid of the giant sucking sound, which is the RJ business that was killing them. AMFs!!!

Hmmmmm!!! so you guys had rj's when SW offer pocket change for your lucrative Buisness!!! funny guy..
but hey as long we all keep our jobs totally separated or as a partner that's all I ask for!!!


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Hmmmmm!!! so you guys had rj's when SW offer pocket change for your lucrative Buisness!!! funny guy..
but hey as long we all keep our jobs totally separated or as a partner that's all I ask for!!!


Sent from my iPhone using Tapatalk

Yup, this is good for everyone all around. If F9 should falter and go under it will be with more dignity than it would have with an anchor of poop (RAH, Heller, etc.) strapped around it's neck.
 
Just to clarify, RAH has not entered into a Pro-Rate agreement with any code share partner since 2001. In fact, when Bedford came on board he shifted the SAAB Us Air agreement to Shuttle America via Wexford while saying he would never again do anything other than a fixed fee agreement because it is a money loser for a regional airline. Now we have a "restructuring agreement" between Frontier and both Republic and Chautauqua as a pro-rate agreement? Don't kid yourselves, it's all about the shell game. That's right, lipstick on one pig, mud on the other.

At the end of the day this has nothing to do with the pilots. I know that kills you USMC319, you would love to take credit for telling RAH guys to eff off. Simple fact is pilots on either side have no say, pilots on either side can't control the books. Bedford and RAH have one thing in mind...money! We are all pawns, it's a shame people like you don't see through the bullsh*t and unite with your fellow pilots.

We can stand up to management or we can fight each other. Sooner or later some pilot group has to take the high road. I am banking on the RAH pilot group to take the high road. We should all support the RAH group in contract negotiations.
 
getnverted,
"unite with your fellow pilots"..."stand up to management or we can fight each other". Those options went out the window when your negotiating committee refused the flow-through offer and demanded to be placed ahead of the Frontier pilots. It became impossible when they decided not to negotiate a workable SLI during Mediation. In other words, it was the IBT represented RAH pilots and their greed that forced Frontier pilots into demanding that F9 be seperated from the Holding company. Its a shame and a real missed opportunity for you guys but at the end of the day you can't steal something from somebody and then expect them to fight for you. It could have been a win-win with unity, but now it will be simply a missed opportunity. You have absolutely nobody to blame except YOUR IBT representation and those individual pilots. Greed is bad....for you.
 
USMC319 I can't see my post anymore I guess one of the mod's deleted already!! B.


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