MAGPBS: What exactly does the Min Target of 79 hours mean? How many hours does a pilot need to have built by PBS in order to get a line? Didn’t Min used to be 76 hours?

 

Means that the minimum requirement for a line is 79 hours.

Was 80 last month.

 

Right now the company seems bent on creating more reserves. The DFW CRJ pairings are light for making a line out of 4 4 days trips. So it's going to be interesting to see how this plays out. I didn't look at the Ejet pairings.

 

On the Ejet, there are 4 day pairings under 20 hours. That means that a pilot will have to be senior to have 4 four days to create a line in order to get 14 days off. With this being a 30 day month (versus a 31 day month), lines can’t be built with 5 four days and get the 11 days off. I expect more reserves this month on the Ejet as well.

 

Interesting read. Copied from Mrs. Hageman's article www.planebusiness.com

Shifting below the Canadian border, Jon Ostrower reported last week in his new publication, The Air Current, that a deal is in the works that would see regional airline Republic Airways acquire Trans States Holdings. Republic and Trans States are, respectively, the second and third largest regional airlines in the U.S. Nevertheless, if the two were to merge, SkyWest would remain the largest U.S. regional airline.

While talk about this link-up has been out there before, I found the timing of Jon's story interesting, as it came out right before the Mesa Air Group IPO is to be priced on Tuesday of this week.

That deal, which we had previously discussed when Mesa filed its initial registration statement with the SEC, was tentatively priced last week at $14-$16 a share. The airline would raise $160.5 million using the midpoint of this pricing. Proceeds of the offering will be used to pay down debt and for "general corporate purposes." Raymond James and BofA Merrill Lynch are lead bookrunners on the deal with Cowen, Stifel, and Imperial Capital acting as co-managers.

Assuming a successful IPO at the midpoint of the proposed price range, the company’s post-IPO market capitalization would be roughly $528 million, excluding the effect of underwriter over-allotment options.

For those of you with enquiring minds, you can watch the retail roadshow presentation here.

But again, do I think there is a link between news being leaked about a potential deal between Republic and Trans States and the Mesa IPO? Yes. Mesa said in its registration documents that one of the things it would consider doing with its new found money was "acquisitions". But it would have been very difficult for Mesa to consider an acquisition unless the airline did an IPO. Remember too that this IPO was rolled out very quickly – and as we mentioned before it's not exactly a great time for an IPO in the sector. In addition, while SkyWest just announced a slew of deals with its existing airline customers in its recent earnings call, there is no new growth cited in the Mesa presentations. Nor are there a lot of opportunities for new regional business out there – the result of scope pressure and increasing direct ownership of regional airlines by mainline carriers.

Put it all together, and yes, I think these two pieces of news are related. Either news of a potential deal was leaked in an attempt to short-circuit the viability of the Mesa IPO, or, a deal is indeed going to happen, and Republic made the decision to make the move now – before Mesa potentially has the financial means to start collecting regional partners. Like Trans States.

 

The republic - trans states rumor is pretty old and predates the Mesa IPO by months. The fact the IPO at $12 per share still went forward shows that whatever the intent of the IPO by Mesa management still existed last Thursday, or the IPO would have been withdrawn. Mesa needs the cash for a reason and it still existed last week.

Rumors are a dime a dozen in the airline business (until they happen). Remember, United was rumored to be buying ExpressJet from SkyWest in Fortune earlier this year. There are even rumors out there that American would continue to increase its ownership stake in Mesa after the IPO to a controlling stake. I think it is easier to buy lotto tickets than believe airline business rumors.

 

[QUOTE=calmwinds;2655399]"The republic - trans states rumor is pretty old and predates the Mesa IPO by months. The fact the IPO at $12 per share still went forward shows that whatever the intent of the IPO by Mesa management still existed last Thursday, or the IPO would have been withdrawn. Mesa needs the cash for a reason and it still existed last week.

Rumors are a dime a dozen in the airline business (until they happen). Remember, United was rumored to be buying ExpressJet from SkyWest in Fortune earlier this year. There are even rumors out there that American would continue to increase its ownership stake in Mesa after the IPO to a controlling stake. I think it is easier to buy lotto tickets than believe airline business"

First, out of pure curiosity, how exactly old is this republic-trans states rumor? Would you happen to have any evidence, perhaps any speculation of it that you could share?

 

[QUOTE=Monocoupe;2655426]It is at least two years old. Just read the posts on their forums here to find Republic - Trans States “rumors”. Rumors are rumors unless they come from board members or executives. And, unsubstantiated, unnamed resources in news articles and blogs are just rumors.

As not just a pilot but an investor in this industry, I don’t put a lot of stock in these rumors. First, regionals don’t really have a lot of assets beyond their CPA’s and their pilot base. Their aircraft are tied up with their lenders. Republic has not really freed itself yet from its bankruptcy. Who do you think really owns Republic? It is their former lenders from before the bankruptcy.

 

Is this EJET? I’m June 15 and doing IOE now on the CRJ.


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Yeah, it seems we are failing in the training department on pushing pilots through sims on the Ejet.