AMR to Divest American Eagle

Nick

Nick

Well-Known Member
http://biz.yahoo.com/prnews/071128/law084.html?.v=101

"The decision comes after a careful and deliberate evaluation of the strategy that will best enable us to continue to create value for our shareholders," said AMR Chairman and CEO Gerard Arpey. "We have worked hard over the years to build a regional airline that is fully capable of standing on its own and is well positioned to pursue growth opportunities outside of the AMR corporate structure."
 
Not good for the Eagle guys. This story sounds all to familiar.Look at the history of Continental and ExpressJet.

With Eagle's outdated fleet, staffing issues, and new exposure to expenses not previously encountered I wish them luck.
 
Where's that guy that basically told us all to F off because he had been hired with Eagle and was expecting flow through (and wasn't keen on any criticism of Eagle whatsoever)?
 
meritflyer said:
Not good for the Eagle guys. This story sounds all to familiar.Look at the history of Continental and ExpressJet.

With Eagle's outdated fleet, staffing issues, and new exposure to expenses not previously encountered I wish them luck.
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Maybe they will go to branded flying and all will be well...right?
 
charlie1017 said:
Wow! Do you believe Executive Airlines (with the ATR's) will separate from Eagle after this?
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Nope. According to the press release, Exec is gonna stay part of Eagle. I also noted that AA is going to allow them to pursue contracts with other airlines, so this might not be a bad thing. That is, of course, if they have the right management team in place. They haven't really had to sell themselves to another carrier in....well, ever, to my knowledge. Press release also says that they plan to have the divesting done sometime in 2008, so things aren't gonna change overnight there. They don't even know how they want to go about doing it. Might pull an NWA and IPO it for the cash, though.
 
This whole plan completely confuses me. Eagle cannot cover the flying we have now. Our pilots are super senior, so who in their right mind would want to buy us. Our CEO said that we would now be able to compete for outside flying, again high costs and no staffing. And our CEO is an AMR employee, he will go back to the mothership when eagle is no longer part of AMR. Aside from out slots at places like LGA/DCA/BOS eagle is a worthless airline with way to high of an overhead.

There I feel better.
 
Velocipede said:
Now THAT'S the understatement of the year!
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Look for consolidation in '08-'09.

There are too many regionals which all offer comparable products so the only way to gain business is unfortunately price.

Potential acquiring companies would most likely be Skywest, Eagle depending on how it's spun off, ExpressJet would make a nice suitor since they carry little long term debt, and possibly RJET although they already carry an unhealthy balance sheet plaqued by long term debt.
 
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