Originally Posted by
rjboy
They could need or want cash for hundreds of reasons or they could simply feel that the stock is too diluted. Unless you have some other reason to believe they are in the market to start competing against the people who sign they paychecks this theory seems pretty farfetched.
I don't think that SKW is going to make a play for Midwest but if they did, the market that they would gain doesn't compete with UAL or DAL. Buying Midwest would, in no way, be a breach of their codeshare contracts. Neither DAL nor UAL compete on Midwest routes. Now, buying AirTran would be a breach of our DAL contract seeing that both at ATL based.
I've said many times that I think SKW purchasing Midwest is a great move in the direction that JA wants to go, but I think the time isn't right. JA has made it know that he wants to stand alone, but it will be a slow process to insuring steady growth without sacrificing the company current contracts.
Don't bite the hand that feeds you until it slaps you in the face.
If I had to guess who JA might make a move on, I would say MAG. They have the lowest labor cost, some of the highest Mgmnt cost and he can get them for dirt cheap. It wouldn't take much to convince their BOD or creditors to approve a SKW takeover. With the purchase JA can overhaul the Mgmnt pay to equal that of SKW and giving their labor groups a new TA comparable to SKW will insure the improvement of their employee moral and turnover issues. This will also be good for the industry because SKW holds strong to their hiring mins, so you will probably see the MPD Programs disappear. Also it would be an in with US Airways and I'm certain that Doug Parker would much rather deal with JA than JO.
Just out of curiosity, what do you MAG guys & gals think of this?
Just my 2 cents. Take it for what it's worth and nothing more.