Thu, Jan 25, 2007
Hungry Airline Asks NY Supreme Court For Help
AirTran Airways says Midwest Airlines is interfering with an
effort to take its merger message to Midwest's shareholders by not
releasing a shareholder list -- something that's required by a New
York state law. As ANN reported, AirTran
wanted to float its latest, upped merger bid directly to Midwest
shareholders after a first offer was flatly refused by Midwest's
board.
Now, AirTran has asked New York's highest court to intervene.
AirTran wants Midwest to show cause why it isn't complying with New
York law. The Court has set a hearing on the action for January 30,
2007, at 11:00 AM.
In a release, AirTran says this latest from Midwest, "...is
consistent with a pattern of intransigence in which the Midwest
management and board has failed to provide transparency about the
benefits of the merger to its shareholders, employees and the
communities it serves since AirTran first presented its offer to
Midwest on October 20, 2006." AirTran say Midwest management
refuses to meet with AirTran to explore its merger offer.
According to AirTran's statement, a well-respected airline
financial analyst from Calyon Securities commented, "We believe
Midwest faces an uncertain future as a stand-alone carrier" noting
its years of losses and its limited ability to modernize and expand
and the serious threat posed by an "invigorated Northwest Airlines"
refocusing its attention on Milwaukee.
AirTran said, "As owners of the airline, Midwest shareholders
have a right to full and complete information about AirTran's
$13.25 exchange offer, which [is 61 percent over Midwest's thirty
day average closing price as of AirTran's original offer, and 46
percent over closing prices as of AirTran's second, increased
offer]."
On January 11, AirTran upped its original buy out offer of $290
million to $345 million. Midwest's board says it's determined to
remain a stand alone company with plans for expansion in 2007.
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