SWA-AAI: Acquisition or Merger??

[MILF Hunter]

I wonder why SWA (the buyer) calls this an acquisition, yet ATN ALPA calls this a merger? Fornaro likes to call it a merger at times, but in his joint release today, even he calls it an acquisition.

Fornaro and Gary posted this announcement on our internal SWA website:

Special Message from Bob Fornaro and Gary Kelly

Blog By: EmployeeNews on Mar 23, 2011 at 10:30am

Shareholders Overwhelmingly Approve Southwest Airlines’ Acquisition of AirTran

Dear AirTran Airways Crew Members and Southwest Airlines Employees,

We want to share some exciting news with you. Today, the shareholders of AirTran Holdings, Inc., overwhelmingly approved the acquisition of AirTran Holdings, Inc., by Southwest Airlines by more than a 98.6 percent positive vote.

We are extremely excited about this latest step and believe the overwhelming number of shareholders voting for the acquisition is a clear indication of the support this deal has, not only from investors large and small, but also from AirTran Crew Members who voted to support this acquisition. We are very thankful and grateful for their confidence.

We realize the acquisition process takes a great deal of time to complete, and we appreciate the patience and resolve you have shown during the six months since we announced our plans to bring these two great airlines together. However, it is important to remember that the acquisition is still under review by the Federal government, and until the transaction is fully approved, Southwest and AirTran must continue to operate as independent airlines.

Since September, we have accomplished many things, laying some of the non-commercial groundwork to seamlessly join our companies, such as gaining FAA approval of the transition plan toward a Single Operating Certificate and today gaining AirTran shareholders’ approval. We anticipate the final government approval to come and to close the transaction in the second quarter. Until then, we continue to plan our collective futures together, to the extent possible, with great anticipation and excitement.

Although we know there are still many unanswered questions, we remain dedicated to providing information as quickly and completely as possible. It is important, however, to remember that we are still competitors and cannot share commercially sensitive data until regulatory clearance is granted. As such, important decisions about stations, routes, and other critical components of the integration of our airlines remain to be examined and determined.

Again, thank you for your patience, encouragement, and support as we continue to work every day to bring these two great airlines together. Please join us in celebrating this important milestone on the path to a collectively bright future.

With warm regards,

Bob Fornaro
Chairman, President, and Chief Executive Officer
AirTran Airways

Gary Kelly
Chairman, President, and Chief Executive Officer
Southwest Airlines

This was sent to me from a tranny buddy, also today:

March 23, 2011


Fellow Pilots,

Today in Orlando, AirTran announced the results of shareholder voting on whether to approve the merger between AirTran Holdings and Southwest Airlines. I doubt that anyone was surprised by the result, with almost 99% of votes cast in favor of the deal.

We expect the next step in this process - approval by the Department of Justice - to come shortly.

These events take place against the background of our continued work on merger issues with our counterparts at SWAPA, and although much attention has focused on the seniority list integration process, we are also engaging in other areas of mutual interest.

This week, the ATN Training Committee welcomed the SWAPA Training Committee to Atlanta to share information and ideas, and will continue discussions in Dallas later this week, which is where each association’s safety committees are meeting as well. Furthermore, SWAPA and MEC representatives will meet to explore more ways to expand cooperation between the associations.

Meanwhile, the Merger Committee continues its work toward finalizing a process agreement, and has recently posted new articles at atnmerger.alpa.org under the SLI Education tab.

Finally, we congratulate the AirTran flight attendants for reaching a tentative agreement on a new contract yesterday. We thank our members who supported the flight attendants on the picket line.

In unity,

Linden Hillman, Chairman
ATN Master Executive Council

This really is an honest question. Why will ALPA not call this an acquisition? It is an acquisition. Is there some tactical reason for this? Is there some difference between the two for ATN pilots? If there isn't a difference, then why not just call it what it is?

 

[Green Banana]

Merger = Integration
Acquisition = Staple

 

[Ty Webb]

Call it whatever puts lead in your pencil. At the end of the day, the seniority lists will be merged.

Some folks may want to acquire the number of a good therapist to help them finally learn to share some of their toys.

 

[funnyman12]

The SEC filing SW filed on 2/1/11 uses the word merger literally over a hundred times and acquisition only a few in over 70 pages. This is an acquisition in which the acquirer is merging the companies. Every merger has an acquiring entitity....eg DAL acquired NWA...it was a purchase and a merger. Not all acquisitions, though, involve merging. EG......Midwest airlines. The SEC filings carry the legal weight and they refer to this deal as a merger most of the time. Also the press releases today referred to the deal as a merger more often than an acquisition, then again the media sux. I would recommend reading the SEC filings SWA has filed regarding the deal.

 

[humveedriver]

For the same reasons the press calls it an acquisition and a merger in the same article. SWA is buying (acquiring) AT. Period. Fact. They are also merging the operations of the two airlines. Mainly AirTran's reservation system and our International Opsecs. The workforce will be reprogrammed into the SWA of doing things. So that's why there is a reference to both acquisition and merger. Where the water gets murky is when you try to compare this transaction to other airline transactions SWA and Muse/ATA or Delta/NWA. I think the perception is when one legacy carrier acquires another legacy of equal size, folks think of it as a merger. When a larger carrier purchases a smaller carrier it gets thought of as an acquisiton. I think each transaction is unique. When you examine only the propaganda put out by each airlines unions, you are going to see posturing and verbage that best serves the membership of each pilot group. My hope is that the employee integration is resolved at the union level by the members of each airline.

 

[funnyman12]

Comparing thr size differential of SWA and AAI is very similar to AMR and TWA and USAir and AmerWest. The end result of this merger/acquisition is very important to all pilots of every airline. We never know where our airline will be in the future....the last thing we want is to set a precedent for a staple or unfair integration when two healthy airlines get together. This industry is very unforgiving and fluid.....in the next 5 years, pilots at Alaska and Jetblue may be facing a merger/acquisition themselves. In 20 years who the heck knows what may be. We should let our unions figure it out, and both sides have to be reasonable.

 

[dh82dvr]

I thought that SWA would aquire AAI, then there would be a merger of the operations.

:beer:

 

[texman]

The SEC filing SW filed on 2/1/11 uses the word merger literally over a hundred times and acquisition only a few in over 70 pages. This is an acquisition in which the acquirer is merging the companies. Every merger has an acquiring entitity....eg DAL acquired NWA...it was a purchase and a merger. Not all acquisitions, though, involve merging. EG......Midwest airlines. The SEC filings carry the legal weight and they refer to this deal as a merger most of the time. Also the press releases today referred to the deal as a merger more often than an acquisition, then again the media sux. I would recommend reading the SEC filings SWA has filed regarding the deal.

funny,

I agree with you some what, but this a acquisition. the word merger is based on the operations, not how the deal goes down. After the dust settles all AT will be is what Eagle is to AMR. Until the two certificates are merged then the SLI or Arbitration award will be binding.

 

[texman]

Comparing thr size differential of SWA and AAI is very similar to AMR and TWA and USAir and AmerWest. The end result of this merger/acquisition is very important to all pilots of every airline. We never know where our airline will be in the future....the last thing we want is to set a precedent for a staple or unfair integration when two healthy airlines get together. This industry is very unforgiving and fluid.....in the next 5 years, pilots at Alaska and Jetblue may be facing a merger/acquisition themselves. In 20 years who the heck knows what may be. We should let our unions figure it out, and both sides have to be reasonable.

True. It has been said many times on this board that SWA mgt. is the one given pay raises not the pilots. So then your aircraft and ATL is in the same boat. So with that being said what can the two pilots really give each other that is fair? I feel this whole deal will take about 5-7 years to figure out.

 

[funnyman12]

You guys......Gary Kelly has a responsibility to the shareholders. The SEC filing are what SW legal team are required to file to highlight their legal plans regarding the Airtran deal. This isn't a document created by SWAPA or ALPA, it was created by SW. I once again invite all to read it. SW management has made it very clear that in order to achieve revenue synergies a swift integration is priority one. Also guys, integration includes all 43,000 employees of both airlines, not just the 7600 pilots. I really don't think there really is a difference in the two words, the meat and potatoes are the SEC filings. Like it or not this deal is inevitable, and if we care about our careers and the health of SW, we all should hope for the quickest and efficient integration of these two airlines.