Say Goodbye to MESA

[Tarzan]

You must not be paying attention. UAL did not renew mesa's agreement because Sky West wrote a $118 million (plus) check. Express Jet agreed to provide the service at below cost AND gave up 20% of the company in warrants.

You don't know what ExpressJet bid. Those numbers are confidential. And Inc did not loan UAL that much. You can speculate all you want but in the end, that is all it is, speculation.

 

[Nevets]

Express Jet agreed to provide the service at below cost AND gave up 20% of the company in warrants.

Just to clarify, no one knows if this is below cost. Also, XJT offered a grant to United of 2.7 million common stock warrants at $2 per stock. XJT has 15.65 million shares of stock outstanding. Once UAL exercises all its warrants, it will own less than 15% in XJT stock.

 

[gator_hater]

Just to clarify, no one knows if this is below cost. Also, XJT offered a grant to United of 2.7 million common stock warrants at $2 per stock. XJT has 15.65 million shares of stock outstanding. Once UAL exercises all its warrants, it will own less than 15% in XJT stock.

you both are equally wrong...

2.7/15.65=17.2%

 

[rene]

go! can not stand without money from mesa and the judge will stop that.
Sell off the Mokulele C-208 operation to feed the monster and bury the bones.. go! has never made money and the 100 mil spent was not JO's..

60,000 passengers per month, Average fares up $15 since the JV with Republic in October, aircraft rents will be down $50,000 per month. That adds up to a profit swing of $1,200,000 per month. In the worst of times when Republic was operating ERJ 170's the losses never exceeded $800,000. So they should be generating a profit consistently by now. They won't need and can't get any money from MAG.

Why do you think Go isn't in BK???

 

[rene]

You don't know what ExpressJet bid. Those numbers are confidential. And Inc did not loan UAL that much. You can speculate all you want but in the end, that is all it is, speculation.

Ok I'll go slowly for you.

1. Express Jet lost $60 million on CAL last year
2. According to their own SEC disclosures the UAL transaction is NOT accretive to earnings.
3. They will avoid paying rent on idle aircraft, they will avoid a significant imparment charge, and they will still take a non cash depreciation charge.
4. So to be clear, Express jet bid the UAL business at an economic and accounting LOSS, but will generate a positive cash flow. It is the better of two evils.
5. They did NOT get this business because of anything to do with Mesa other than the fact that mesa's contract was expiring.
6. I don't dispute your warrant calculation, I was just using approximate numbers rather than precise ones. My point was, at today's price those warrants are worth about $16 - $20 million to UAL. (17% of market cap = $17 million)

I hope this helps clarify things.

 

[Nevets]

you both are equally wrong...

2.7/15.65=17.2%

Actually, once UAL exercises all the warrants there will be 2.7+15.65=18.35 shares outstanding, 2.7 of which will belong to UAL. 2.7/18.35=14.7%

Ok I'll go slowly for you.

1. Express Jet lost $60 million on CAL last year

1. That is CAL flying. I thought we were talking about the UAL deal.

   [*]According to their own SEC disclosures the UAL transaction is NOT accretive to earnings.

   Can you provide a link. I see that the 10Q mentions an additional 10-15% more total block hours because of the UAL deal.

   [*]They will avoid paying rent on idle aircraft, they will avoid a significant imparment charge, and they will still take a non cash depreciation charge.

   Those aircraft are not idle. They are used in the charter department. And I don't think there is no impairment charge or depreciation on those aircraft. Can you provide a link?

   [*]So to be clear, Express jet bid the UAL business at an economic and accounting LOSS, but will generate a positive cash flow. It is the better of two evils.

   That, no one knows, yet. It is to be seen when the 3rd Qtr 10Q comes out in November. I suspect a lot will depend on the aircraft utilization rate.
   

   [*]I don't dispute your warrant calculation, I was just using approximate numbers rather than precise ones. My point was, at today's price those warrants are worth about $16 - $20 million to UAL. (17% of market cap = $17 million)

   Actually, the warrants are for a minimum of $2. So UAL will get whatever the market is buying them at the time or $2, whichever is greater. At today's prices, they are worth $9.585M (17.25% of market cap). They are worth $5.4M minimum. That is the only guarantee.

 

[CaribPilot]

Rene is in denial. Mesa is the absolute worst regional in existence and they need to go away.

 

[dooork]

Rene is in denial. Mesa is the absolute worst regional in existence and they need to go away.

I thought ASA won that award again.

 

[Stifler's Mom]

I thought ASA won that award again.

How tough is it going through life so angry?

 

[79%N1]

I thought ASA won that award again.

Yea, cause ASA has really repeatedly undercut other regionals by using their cheap labor costs to drive down regional wages and steal away contracts. And ASA pilots, just like Mesa pilots, have also repeatedly voted for less than industry standard contracts to ensure said undercutting and enable their own fast upgrades! Oh wait. No, ASA pilots have never done that and in fact have repeatedly voted down anything that looked like concessions for growth and held long and hard for a current contract that is industry leading in many - if not most - sections.

Now, if you want to compare performance lets compare ASA, who operates nearly 1000 flights a day at times into and out of ATL, with historically bad ATC congestion troubles, not to mention Delta who under supports ASA's operation with lack of gates and staffing. Compare that to operating out of SLC, MEM or CVG. Not even close! And despite that, ASA is currently among the top DCI performers while competing with CHQ's 123 flights (A high majority from CVG) F8's 96 flights (Nearly all from CVG) CP's 167, S5's 88 flights, Comair's 422 and Skywest's 476. Yet just yesterday ASA was #1 DCI in A14. ASA is also the leader in customer satifaction for alll DCI in Delta customer survey reports.

And ASA has never been fired from it's partner like Mesa has - repeatedly - throughout it's history. (United in the 90's, Delta and United now)

ASA certainly has had operational issues operating under Delta in ATL that other DCI carriers don't have, but have never accepted low ball contracts to ensure growth, and have drawn the lack of respect from other pilots like Mesa, Gojets, etc...

So bash away........