Airline Pilot Central Forums

Airline Pilot Central Forums (https://www.airlinepilotforums.com/)
-   Major (https://www.airlinepilotforums.com/major/)
-   -   Spirit and investors buy Air Jamaica (https://www.airlinepilotforums.com/major/41647-spirit-investors-buy-air-jamaica.html)

emj55 07-04-2009 07:03 AM

Spirit and investors buy Air Jamaica
 
Air Jamaica sold - First murmurs about who has bought the national carrier have surfaced

Published: Saturday | July 4, 2009

Janet Silvera, Senior Gleaner Writer

WESTERN BUREAU:

The Gleaner has learnt that Indigo Partners and Oaktree Capital, who are reportedly the owners of Spirit Airlines, have bought the country's national carrier, Air Jamaica.

It is further understood that Air Jamaica's name might be changed to Spirit of Jamaica.

Sources close to the negotiations are tight-lipped, but they have confirmed that Trinidadian-owned Caribbean Airlines did not win the bid to take over the Jamaican airline.

The news comes days after the Privatisation committee, which has been managing the task of privatising Air Jamaica, submitted its recommendation to Senator Don Wehby, minister without portfolio in the Ministry of Finance.

It also comes at a time when the airline is reporting an operational surplus for the first time in 10 years.

On Tuesday, Wehby disclosed that the Privatisation Committee, chaired by Dennis Lalor, had submitted to him the evaluation and recommendation report on the privatisation of the national carrier.

In a media release, the minister said that the committee - assisted by expert input from the International Finance Corporation, which is the private-sector arm of the World Bank Group, and which has a record of more than 150 successful assignments in some 60 countries - had negotiated strategically with the two top investor prospects and had made a final recommendation for the signing of a document of agreed terms with one party. The terms include a provision for the Government of Jamaica to maintain a minority equity stake in the airline.

Some stakeholders in the tourist industry would not be disappointed with this outcome. Many have confided that this would be good move on the part of the Air Jamaica divestment team.

"Spirit is already mean and lean and that is exactly what Air Jamaica needs in order to strategically grow," said one hotelier, adding that the routes plied by both carriers might be complementary.

Strategic investment

Earlier, Spirit had announced the completion of a strategic investment, led by Indigo Partners LLC and funds managed by Oaktree Capital Management LLC. The investment will provide significant resources for the company to consolidate its position as the leading low-cost carrier to the Caribbean, and pursue its long-term growth strategy.

Indigo Partners LLC, with offices in Phoenix, Arizona and Singapore, is a private-equity fund focused primarily on investing in the transportation, airline and airline-related sectors globally.

Oaktree Capital Management LLC is a Los Angeles-based private investment firm that manages in excess of US$30 billion in select niche investment markets
for institutions and wealthy individuals.






I know this was already posted. I just thought it deserves its own thread.

RAHPilot5 07-04-2009 07:09 AM

Next, RAH buys Spirit :)

Twin Wasp 07-04-2009 07:10 AM

It's got it's own thread.

Didn't Oaktree roll Cargo360 into Southern Air?

Nopac 07-04-2009 08:05 AM


Originally Posted by Twin Wasp (Post 639337)
It's got it's own thread.

Didn't Oaktree roll Cargo360 into Southern Air?

Yes they did, but most of the C360 pilots elected not to go over.



With regards to Air Jamaica, now the Spirit pilots can use that punch line from that old joke:
"Actually it reads: Welcome to Jamaica, mon, have a nice day...."

11Fan 07-04-2009 08:12 AM

Wendy who?

390SetBlue 07-04-2009 08:45 AM


Originally Posted by RAHPilot5 (Post 639334)
Next, RAH buys Spirit :)

Ahh.... NO! :D

Justdoinmyjob 07-04-2009 10:25 AM


Originally Posted by 11Fan (Post 639358)
Wendy who?



Niiiiccceee!

PAN PAN PAN 07-05-2009 10:21 AM

Spirit is becoming quite the power house in the caribbean/south american market place, seems to me this move will only solidify there hold down there. They appear to be on the track for a caribbean domination, they are making money for sure, just hope it doesn't come from expense of pilots getting furloughed from either place that would be a bummer. The sign of the times and the rise of the ULCC!!!!

FLYBOYMATTHEW 07-06-2009 11:44 AM

I'm curious to hear what theories are out there on what this means for the 2 carriers. Will the airlines be merged, or will they operate separately...setting the stage for whipsawing for the A320 deliveries?

GRDHound 07-06-2009 12:07 PM

From the article I read there are strings attached by the Jamaican government that say "the airline must keep it's Jamaican Id." They mention that the airline will possibly be called Spirit of Jamaica or something along those lines. From that I would guess that the list will remain separate and the aircraft might have to keep their Jamaican registries but who knows.

BoredwLife 07-06-2009 12:37 PM

The Jamacian cabinent can still shoot this down. The employess are in a huge uproar and are claiming major job loses with future trimming and restructuring.

DAL4EVER 07-06-2009 01:35 PM

Will Spirit drop the champagne flights and replace them instead with 40s of Old English? "Rollin', rollin', rollin'."

captscott26 07-06-2009 02:13 PM

If the Jam govt doesnt protect the employees of Air Jamaica in this deal they are totally screwed. Indigo does what makes money......and if you look at the numbers it is obvious that Spirit makes money, and Air Jamaica doesn't. Not sure if this is accurate but I read that AJ has a CASM more than double what NK's is. What would you do if you were on the Indigo BOD?

PAN PAN PAN 07-07-2009 06:20 PM


Originally Posted by BoredwLife (Post 640197)
The Jamacian cabinent can still shoot this down. The employess are in a huge uproar and are claiming major job loses with future trimming and restructuring.


Be afraid, be very afraid...I know I would be here comes the ULCC business model

WorldTraveler 07-09-2009 06:09 AM

This is just one more example of how airline management has figured out a way around cross border ownership restrictions.

Like it or nor, the Jamaican government will have to do some kind of deal. Spirit will likely have to offer some sort of labor protections. In lieu of this deal, the future for Air Jamaica, looks a lot like Alitalia.

Normann 07-09-2009 06:37 AM


Originally Posted by RAHPilot5 (Post 639334)
Next, RAH buys Spirit :)

next RAH goes CH11 within 3-5 years :)

RemoveB4flght 07-09-2009 09:53 AM


Originally Posted by WorldTraveler (Post 641884)
This is just one more example of how airline management has figured out a way around cross border ownership restrictions.

Like it or nor, the Jamaican government will have to do some kind of deal. Spirit will likely have to offer some sort of labor protections. In lieu of this deal, the future for Air Jamaica, looks a lot like Alitalia.


You can't have your cake and eat it too.. Obviously there is a well founded concern that new ownership will bring about sweeping changes to the company structure, including job cuts. If I were a rank and file employee of Air Jam I would be nervous too.

I don't wish job loss on anyone, but you have to look at the numbers. Air Jamaica was privately owned for nine years before it was re-nationalized back in 2005.

At that time, it posted an operating loss of 90 million for the year, and since then that operating loss has grown to 150 million a year, which is subsidized by the government. That doesn't include an additional 600 million in outstanding loans.

On the other hand, 2009 has shown stellar performance this year in terms of load factor and cancelled flights.

The airline is begging to be streamlined.. and while national identity and airline job loss would appear to be the concerns in the headlines, the country is so dependant on tourism that I would imagine the real concern would be instead to increase frequencies and explore new markets.

Ending the government subsisdized losses and increasing the amount of tourists setting foot on their soil will far outweigh the negative impact of job losses due to streamlining the business model... IMHO

A320Flyer 07-09-2009 10:21 AM


Originally Posted by RemoveB4flght (Post 641975)
You can't have your cake and eat it too.. Obviously there is a well founded concern that new ownership will bring about sweeping changes to the company structure, including job cuts. If I were a rank and file employee of Air Jam I would be nervous too.

I don't wish job loss on anyone, but you have to look at the numbers. Air Jamaica was privately owned for nine years before it was re-nationalized back in 2005.

At that time, it posted an operating loss of 90 million for the year, and since then that operating loss has grown to 150 million a year, which is subsidized by the government. That doesn't include an additional 600 million in outstanding loans.

On the other hand, 2009 has shown stellar performance this year in terms of load factor and cancelled flights.

The airline is begging to be streamlined.. and while national identity and airline job loss would appear to be the concerns in the headlines, the country is so dependant on tourism that I would imagine the real concern would be instead to increase frequencies and explore new markets.

Ending the government subsisdized losses and increasing the amount of tourists setting foot on their soil will far outweigh the negative impact of job losses due to streamlining the business model... IMHO

Agreed completely...


All times are GMT -8. The time now is 07:06 PM.


User Alert System provided by Advanced User Tagging v3.3.0 (Lite) - vBulletin Mods & Addons Copyright © 2021 DragonByte Technologies Ltd.
Website Copyright 2000 - 2017 MH Sub I, LLC dba Internet Brands