Mon, Aug 13, 2007
Gives Final 'No' To AirTran
One saga is finally over... but a new one is just beginning.
Nine months after AirTran Airways first voiced its intent to take over
Midwest Airlines, the Board of Directors of Midwest
Air Group said Sunday it has unanimously determined to pursue a
buyout offer -- and not from AirTran. TPG Capital, L.P. offered to
acquire all of the outstanding shares of Midwest for $16.00 per
The board took its action after receiving a letter from AirTran
Holdings, Inc. in which AirTran stated it was making its best and
final offer to acquire all of the outstanding shares of Midwest
pursuant to a one-step merger for consideration consisting of cash
and stock at $15.75 per share, valued at Friday's closing price of
AirTran's common stock. The offer was $.75 per share greater than
the airline's previous "best" offer.
The board determined the TPG offer presented greater value and
certainty for Midwest shareholders than the AirTran offer... but
jilted AirTran begged to differ.
"The Midwest board has chosen a path that will benefit current
senior management by selling out to a private equity firm and a
so-called 'passive' investor whose involvement will surely raise
antitrust concerns, casting doubt for shareholders on whether a
transaction can, in fact, close," the airline said in a statement
Though no official announcement has been made, many believe the
'passive' investor in the TPG deal is none other than Northwest
Airlines. As ANN reported, Northwest
was reportedly considering a passive stake in the airline, in part
to protect a marketing deal signed earlier this year.
Under the terms of the offer from TPG, the private equity
investor indicated that its acquisition "would permit the Company
to continue its rich legacy as a leading provider of customer
oriented quality air service."
Midwest and TPG expect to execute a definitive merger agreement
no later than August 15, 2007.
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