Arrangement Passes Regulatory Muster

With little fanfare, federal antitrust regulators Wednesday signed off on the sale of Midwest Air Group Inc. to a private equity firm and Northwest Airlines.

Midwest Air Group of Oak Creek, WI agreed last year to be acquired by TPG Capital, a Fort Worth, TX private equity firm, for $452 million. The transaction is being backed financially by Midwest's Eagan-based rival, Northwest Airlines.

All parties involved closed the deal Thursday, shortly after the approval was announced.

"We’re looking forward to capitalizing on TPG’s considerable experience in the airline industry to help us continue to meet — and exceed — the expectations of the traveling public," said Midwest chairman and CEO Timothy Hoeksema, according to The Wichita Business Journal.

As ANN reported, Midwest management agreed to TPG's $17-per-share buyout offer in August 2007, putting a final end to repeated attempts by rival AirTran Airways to force a hostile takeover. Shareholders approved the offer in October, but the US Department of Justice requested additional information.

Under terms of the deal, Northwest will maintain a 47 percent interest in the entity created to acquire Midwest, but will have no right to exert any management control over the airline -- an arrangement which apparently satisfied regulators.

Northwest operates three daily flights to Memphis and two daily flights to Minneapolis using carrier Pinnacle Airlines.

FMI: www.midwestairlines.com, www.texaspacificgroup.com, www.nwa.com