With a deal further sweeetened by AirTran to $15 per share, you gotta figure the big institutional shareholders of Midwest Air Group will take the money and run.
AirTran will reduce the number of flights out of Milwaukee in favor of its Atlanta hub (oh, boy!).
Attention Free Marketeers: getting in and out of a hub-and-spoke system in Atlanta is the price you pay for someone else's per share capital gain, right?
And besides a loss of direct service and prestige here, does anyone think "AirTran Convention Center" conveys much of anything?
At least Midwest Airlines Center told you where you were. AirTran could just as easily be the name of some vacuum cleaning system.
Jim:
ReplyDeleteThe Journal Sentinel and other publications have yet to cite:
1. the net Worth and credit line of Air Tran. The $15 per share offer when Air Tran's own stock has dropped to $10 suggests that the Florida company's making a desperation buyout attempt of a firm whose future looks more profitable than its own.
2. The history of Republic Airlines, nee North Central, nee Wisconsin Central, formerly near the best regional air carriers, which was absorbed into Northwest, whose history of providing inferior service to Milwaukee is well known. Of Course, NW is a major JS advertiser.
Relying on outside aviation "experts" gives all stories (including this one) a gloomy outlook for air service in Wisconsin. 1980-84 Aviation was one of my beats when I labored in the newsroom of the Oshkosh Northwestern, and the CEO of Republic used much of the same language as that of Air Tran in plotting its future as a national carrier. I was on board Midwest's maiden "press flight" in 1984 when the airline was launched with 3 used DC-9s, and Hoeksema's growth plan has served local needs beautifully. AirTran will go deeper into hock with its fleet of 737s it has ordered at $50 million a pop. Let's hope AirTran runs out of credit and Midwest's strategy prevails. Holding on to one's stock at a dollar a share less than selling it now might make long term financial sense.
Gary Shellman
Jim:
ReplyDeleteThe Journal Sentinel and other publications have yet to cite:
1. the net Worth and credit line of Air Tran. The $15 per share offer when Air Tran's own stock has dropped to $10 suggests that the Florida company's making a desperation buyout attempt of a firm whose future looks more profitable than its own.
2. The history of Republic Airlines, nee North Central, nee Wisconsin Central, formerly near the best regional air carriers, which was absorbed into Northwest, whose history of providing inferior service to Milwaukee is well known. Of Course, NW is a major JS advertiser.
Relying on outside aviation "experts" gives all stories (including this one) a gloomy outlook for air service in Wisconsin. 1980-84 Aviation was one of my beats when I labored in the newsroom of the Oshkosh Northwestern, and the CEO of Republic used much of the same language as that of Air Tran in plotting its future as a national carrier. I was on board Midwest's maiden "press flight" in 1984 when the airline was launched with 3 used DC-9s, and Hoeksema's growth plan has served local needs beautifully. AirTran will go deeper into hock with its fleet of 737s it has ordered at $50 million a pop. Let's hope AirTran runs out of credit and Midwest's strategy prevails. Holding on to one's stock at a dollar a share less than selling it now might make long term financial sense.
Gary Shellman
Thank you, Gary. Insightful, historical commentary.
ReplyDeleteYou should start your own blog!