ASA/Comair for sale?
- Thread starter flyover
- Start date
mrivc211
Well-Known Member
Hahahah Told ya!
Source: Aviation Daily 3.8.05
SkyWest CEO Jerry Atkin yesterday sought to cool widespread speculation that the carrier is considering buying Delta's regional subsidiaries, Atlantic Southeast (ASA) and Comair.
Atkin told The DAILY at the International Society of Transport Aircraft Trading (ISTAT) conference in Scottsdale, Ariz., that recent press reports about purchase negotiations with Delta were a stretch. "We've had solicited and unsolicited discussions with every network carrier in America -- anything beyond that is speculation," Atkin said. He later echoed that point in a presentation, saying, "There are some opportunities out there, and when we get beyond the exploratory phase, we'll talk about it."
SkyWest in the past two years has been open about its desire to use its robust balance sheet -- now at about $500 million in cash and marketable securities -- for acquisitions. It's not the first time SkyWest has eyed buying another regional carrier. The airline considered buying ExpressJet before Continental decided to spin off its regional arm.
Speculation about the Delta subsidiaries stemmed from comments by SkyWest CFO Bradford Rich at the Raymond James investor conference in Orlando on Monday. Rich said SkyWest has "had some discussions with Delta about [the sale]." He noted that Delta "has expressed their desire pretty specifically to us...We are aware of their interest, and we are looking at this."
Rich also said, however, that SkyWest is "not interested in growth for growth's sake" and that the carrier would move very carefully if it decided to pursue the Delta acquisition. "A number of issues would have to be worked out and dealt with," Rich said. Because of its strong cash position, SkyWest is "in the best position of anyone to take advantage" of this type of opportunity.
Analyst Robert Mann, of RW Mann and Co., told The DAILY that "it is easy to understand Delta's desire to monetize the regional carrier assets...to raise cash and offload debt and obligations." But he noted that Comair and ASA are among the highest-cost regional carriers in the industry, "and thus will not fetch the sort of financial multiples that ExpressJet, Pinnacle and Republic Airline Holdings have achieved."
This might result in a low purchase price and the appearance of a good deal for SkyWest or another buyer, although the subsidiaries would come with a significant "fix-up" price tag and high labor costs, Mann said. Delta would also face the issue of losing control of its regional flying.
Also at the ISTAT conference, Atkin said he finds Bombardier's proposed C- Series plane intriguing, and believes the unit costs of the 110- to 130-seat aircraft family could be attractive if the Canadian airframer launches the larger jets.
Atkin said SkyWest has looked at the plane and found its unit costs were "below anything out there in that size." He noted it's not clear how SkyWest might use the aircraft in today's marketplace but "we have a couple years to figure that out." Bombardier's board this month is scheduled to decide whether to launch the plane. One of the many options SkyWest has considered for the future is operating planes up to 150 seats as a low-cost operator. It also looked at opportunities to partner with existing low-cost airlines. Like the scenario at many regional carriers, SkyWest's deliveries are murky beyond 2005. The carrier has no firm deliveries planned after June, but Atkin said there's been a lot discussion with his carrier's major partners and other carriers about future growth.
Source: Aviation Daily 3.8.05
SkyWest CEO Jerry Atkin yesterday sought to cool widespread speculation that the carrier is considering buying Delta's regional subsidiaries, Atlantic Southeast (ASA) and Comair.
Atkin told The DAILY at the International Society of Transport Aircraft Trading (ISTAT) conference in Scottsdale, Ariz., that recent press reports about purchase negotiations with Delta were a stretch. "We've had solicited and unsolicited discussions with every network carrier in America -- anything beyond that is speculation," Atkin said. He later echoed that point in a presentation, saying, "There are some opportunities out there, and when we get beyond the exploratory phase, we'll talk about it."
SkyWest in the past two years has been open about its desire to use its robust balance sheet -- now at about $500 million in cash and marketable securities -- for acquisitions. It's not the first time SkyWest has eyed buying another regional carrier. The airline considered buying ExpressJet before Continental decided to spin off its regional arm.
Speculation about the Delta subsidiaries stemmed from comments by SkyWest CFO Bradford Rich at the Raymond James investor conference in Orlando on Monday. Rich said SkyWest has "had some discussions with Delta about [the sale]." He noted that Delta "has expressed their desire pretty specifically to us...We are aware of their interest, and we are looking at this."
Rich also said, however, that SkyWest is "not interested in growth for growth's sake" and that the carrier would move very carefully if it decided to pursue the Delta acquisition. "A number of issues would have to be worked out and dealt with," Rich said. Because of its strong cash position, SkyWest is "in the best position of anyone to take advantage" of this type of opportunity.
Analyst Robert Mann, of RW Mann and Co., told The DAILY that "it is easy to understand Delta's desire to monetize the regional carrier assets...to raise cash and offload debt and obligations." But he noted that Comair and ASA are among the highest-cost regional carriers in the industry, "and thus will not fetch the sort of financial multiples that ExpressJet, Pinnacle and Republic Airline Holdings have achieved."
This might result in a low purchase price and the appearance of a good deal for SkyWest or another buyer, although the subsidiaries would come with a significant "fix-up" price tag and high labor costs, Mann said. Delta would also face the issue of losing control of its regional flying.
Also at the ISTAT conference, Atkin said he finds Bombardier's proposed C- Series plane intriguing, and believes the unit costs of the 110- to 130-seat aircraft family could be attractive if the Canadian airframer launches the larger jets.
Atkin said SkyWest has looked at the plane and found its unit costs were "below anything out there in that size." He noted it's not clear how SkyWest might use the aircraft in today's marketplace but "we have a couple years to figure that out." Bombardier's board this month is scheduled to decide whether to launch the plane. One of the many options SkyWest has considered for the future is operating planes up to 150 seats as a low-cost operator. It also looked at opportunities to partner with existing low-cost airlines. Like the scenario at many regional carriers, SkyWest's deliveries are murky beyond 2005. The carrier has no firm deliveries planned after June, but Atkin said there's been a lot discussion with his carrier's major partners and other carriers about future growth.
Maximilian_Jenius
Super User
....eh it is common practices for both business and celebrities to deny,deny,deny the obvious truth.
Until they are actually ready to comment/deals are finalized etc.
In case of celebs it's when there relationships are over or on the fence etc.
I say lets wait and see.
-Matthew
Until they are actually ready to comment/deals are finalized etc.
In case of celebs it's when there relationships are over or on the fence etc.
I say lets wait and see.
-Matthew
Tim
New Member
Aloft Operation Clockwork is Delta's new transformation name...Basically it means everything must go on-time regardless....Supposedly we arent holding for pax or bags....so dont be late.......
I think they forgot the formula of good employee moral=good customer service=many happy paxs and revenue..
I think they forgot the formula of good employee moral=good customer service=many happy paxs and revenue..
flyover
New Member
Working the graveyard shift, huh Tim?
The other formula is good service equals good morale. Employees enjoy their work when they can accomplish their targets. They hate it when they can't, it just frustrates them. If Delta stays too understaffed to connect the bags, then the bag deals will just get worse.
I imagine the rumors are coming fast and furious now. I know it's easy for me to say, but hang in there buddy.
The other formula is good service equals good morale. Employees enjoy their work when they can accomplish their targets. They hate it when they can't, it just frustrates them. If Delta stays too understaffed to connect the bags, then the bag deals will just get worse.
I imagine the rumors are coming fast and furious now. I know it's easy for me to say, but hang in there buddy.
Tim
New Member
Dave I am now on the B-Shift (0500-1330). Our duty managers and managers dont have a clue...They never address the actual problem they instead just make wholesale changes and make it worse. As of yesterday the new thing is a painted red line just inside the gate area next to the roadway. They have told the supervisors to right folks up if they dont come to a full and complete stop..So now we are all looking around for Barney Fife. Oh also you must approach it at a 90 degree angle to the road. Management has stated that by doing this it will cut down on OJI's...go figure...OJI's have nothing to do with being overworked and understaffed. I cant wait to see what next weeks new rules are. The geniuses also have told the supervisor that there bid will be a blind one...meaning they probably will get to be the shift they want but not the area. Trying to break up the buddy system I guess. See what you are missing since you retired
aloft
New Member
[ QUOTE ]
....eh it is common practices for both business and celebrities to deny,deny,deny the obvious truth.
[/ QUOTE ]
Like Nick Carter's publicist this morning, after li'l Nicky got himself a DUI last night:
[ QUOTE ]
"Nick Carter deeply regrets the current situation. He is on doctor prescribed medication and was unaware of its interaction possibilities," Carter publicist Juliette Harris said Monday in a statement.
[/ QUOTE ]
A drug interaction can result in a blood-alcohol level above .08? Who knew!
....eh it is common practices for both business and celebrities to deny,deny,deny the obvious truth.
[/ QUOTE ]
Like Nick Carter's publicist this morning, after li'l Nicky got himself a DUI last night:
[ QUOTE ]
"Nick Carter deeply regrets the current situation. He is on doctor prescribed medication and was unaware of its interaction possibilities," Carter publicist Juliette Harris said Monday in a statement.
[/ QUOTE ]
A drug interaction can result in a blood-alcohol level above .08? Who knew!
Even better. We're waiting for the hotel van tonight in BDL and there's a lone flight attendant that's waiting with us for the van.
"What's this I heard about Southwest purchasing Comair?"
"Huh? SKY west?"
"No, the OBL told us that her husband read that Southwest was going to buy Comair and trade in the RJs for 737s!"
Funny how rumors start, are spread, misunderstood and begin a life of their own. I'd be suprised is someone doesn't try to 'scoop' my post and it ends up in some newspaper.
"What's this I heard about Southwest purchasing Comair?"
"Huh? SKY west?"
"No, the OBL told us that her husband read that Southwest was going to buy Comair and trade in the RJs for 737s!"
Funny how rumors start, are spread, misunderstood and begin a life of their own. I'd be suprised is someone doesn't try to 'scoop' my post and it ends up in some newspaper.
Tim
New Member
The little Gate Gourmet cars..(Kia Rio) was at one point getting smacked by a tug just about everyday.. The would hide behind the bag carts at the road and then pull out and get smacked. Most of the time the gourmet driver was on the phone and not paying attention. I know change has to be made but change was is broken not what you think makes you look good....not a management philosphy I know.
flyover
New Member
I always thought the ramp was dangerous enough. Then I saw people wandering around, oblivious, talking on their cell phones. What's the policy on that? We were having problems with them in the cockpit. I had one guy that was running his mortgage loan office out of the cockpit and business was good. So we put in a policy of no phone usage in the cockpit, which was summarily ignored.
flyover
New Member
Today's announcement pretty well shows why they would be shopping anything, including the kitchen sink. Basically, out of cash by year end. Of course they won't allow cash reserves to get that low before taking some "other" action.
Delta Expects to Report 'Substantial' 2005 Loss
Delta Expects to Report 'Substantial' 2005 Loss
flyover
New Member
Basically they said if they don't find a new source of cash they'll be in BK before end of the year.
This isn't surprising. There was no "fix" that was going to immediately restore profits. I'm sure they were hoping for some miracle on fuel and some other breaks, like UAL or USA shutting down. Now they may be hoping to spring some cash for DCI, but there's probably not enough there to make it worth it. And even if BK is the ultimate result, they still have to keep pressing forward on operational changes in the hopes of exiting BK someday.
I've felt BK was likely since about 2002. I think the whole industry will have to walk through it. It could be the mechanism needed to allow consolidation to move forward.
This isn't surprising. There was no "fix" that was going to immediately restore profits. I'm sure they were hoping for some miracle on fuel and some other breaks, like UAL or USA shutting down. Now they may be hoping to spring some cash for DCI, but there's probably not enough there to make it worth it. And even if BK is the ultimate result, they still have to keep pressing forward on operational changes in the hopes of exiting BK someday.
I've felt BK was likely since about 2002. I think the whole industry will have to walk through it. It could be the mechanism needed to allow consolidation to move forward.
aloft
New Member
I too have believed for some time that bankruptcy was inevitable for all the major players for no other reason than to get the maximum cuts in labor costs possible. It's a necessity to maintain competitiveness against other carriers that have done it already.
This practice of bankruptcy-as-business-strategy to accomplish what management could not otherwise is, in my opinion, criminal. In light of pending legislation that will make it much harder for individuals to file for bankruptcy protection, I believe the same should be mandated for corporate entities to end the practice. Do I think this will ever happen? Not with Bush in the White House and a Republican-controlled Congress; they're way too beholden to corporate special interests.
This practice of bankruptcy-as-business-strategy to accomplish what management could not otherwise is, in my opinion, criminal. In light of pending legislation that will make it much harder for individuals to file for bankruptcy protection, I believe the same should be mandated for corporate entities to end the practice. Do I think this will ever happen? Not with Bush in the White House and a Republican-controlled Congress; they're way too beholden to corporate special interests.
flyover
New Member
[ QUOTE ]
This practice of bankruptcy-as-business-strategy to accomplish what management could not otherwise is, in my opinion, criminal.
[/ QUOTE ]
There have been past instances of what you are talking about. And bankruptcy code was changed to prevent Lorenzo tactics. But the idea that the current airlines are anything other than completely and utterly financially bankrupt is, in my opinion, a real stretch. If the term "bankrupt" doesn't apply to them, it doesn't apply to any company.
The funny thing is that one of the beneficiaries of bankruptcy are the employees and the shareholders are the primary losers.
Until a relatively short time ago a bankruptcy in the airline business meant waking up one morning to read that your job was gone, the airline shutdown, and your final paycheck would come months or years later after the liquidation, if at all. I knew a number of people in that boat.
Now a number of airlines have made it through bk and continued to provide jobs and careers. I'm sure some will from this debacle too. Some surely won't. But jobs and payrolls and pensions don't just materialize out of thin air. They come from viable companies, unless you work for the government.
This practice of bankruptcy-as-business-strategy to accomplish what management could not otherwise is, in my opinion, criminal.
[/ QUOTE ]
There have been past instances of what you are talking about. And bankruptcy code was changed to prevent Lorenzo tactics. But the idea that the current airlines are anything other than completely and utterly financially bankrupt is, in my opinion, a real stretch. If the term "bankrupt" doesn't apply to them, it doesn't apply to any company.
The funny thing is that one of the beneficiaries of bankruptcy are the employees and the shareholders are the primary losers.
Until a relatively short time ago a bankruptcy in the airline business meant waking up one morning to read that your job was gone, the airline shutdown, and your final paycheck would come months or years later after the liquidation, if at all. I knew a number of people in that boat.
Now a number of airlines have made it through bk and continued to provide jobs and careers. I'm sure some will from this debacle too. Some surely won't. But jobs and payrolls and pensions don't just materialize out of thin air. They come from viable companies, unless you work for the government.