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Old 04-08-2009, 06:10 AM   #1  
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Default MESA sells China Venture

Further tough times for Mesa. Good, Bad or indifferent it looks likes MESA's time is short lived. Keep in mind there are some really great guys over there (and of course JO is there too). This is not meant as flame bait, just news. Please keep comments neutral on this thread.

Mesa Reveals Deal To Sell China Venture | AVIATION WEEK

Apr 7, 2009
By Andrew Compart


Financially troubled Mesa Air Group reached an agreement to sell off its stake in a Chinese joint venture for a net of $3.6 million, the airline disclosed in an SEC filing April 6. But that means Mesa is taking a substantial loss on its $5.8 million investment, and has to find something else to do with the five CRJ-200 aircraft it was leasing for use by the Chinese regional jet service.

Mesa invested in the China regional jet joint venture with Shenzhen Airlines in late 2006 with a lot of fanfare, and received some praise for broadening its horizons in a deal under which the Chinese carrier was eventually going to sublease 20 Mesa aircraft. But the regional carrier, Kunpeng Airlines, has struggled, and last year Mesa entered a letter of intent to sell its interest in Kunpeng to Shenzhen for $4.8 million.

The amount has now declined. Mesa said in its SEC filing that it reached an agreement with Shenzhen on Feb. 26 under which it will get $4.5 million from the sale and the payment of outstanding aircraft lease payments, but the total will be offset by Mesa’s return of security deposits totaling $0.9 million.

The deal is scheduled to close by mid-April.

Mesa also disclosed that US Airways is slowly cutting back on the number of Mesa CRJ-200 aircraft it is using under its agreement with the carrier.

Under the US Airways contract with Mesa, it can reduce its CRJ fleet by one aircraft in any six-month period. One CRJ-200 already was removed from service in January and a second will be removed in September and a third in January 2010, Mesa said. “We anticipate that US Airways will continue to further reduce the number of covered aircraft in accordance with the agreement,” Mesa said in the filing.

Mesa also provided an update in its ongoing contractual disputes with Delta over its regional flying for that airline, some of which have ended up in court. Delta said last month (DAILY, March 19) that Mesa, which last year won a preliminary injunction to prevent Delta from canceling a regional flying contract, will have to pull six of those aircraft out of Delta Connection service anyway because it missed a contractual deadline to extend the term of the deal. In its SEC filing, Mesa contested that account.

“The parties are currently in disagreement regarding the effectiveness of a notice issued by Mesa to extend the term of these aircraft for an additional one year term at reduced compensation,” Mesa said.
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Old 04-08-2009, 07:30 AM   #2  
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Originally Posted by AirbornPegasus View Post

Mesa also disclosed that US Airways is slowly cutting back on the number of Mesa CRJ-200 aircraft it is using under its agreement with the carrier.

Under the US Airways contract with Mesa, it can reduce its CRJ fleet by one aircraft in any six-month period. One CRJ-200 already was removed from service in January and a second will be removed in September and a third in January 2010, Mesa said. “We anticipate that US Airways will continue to further reduce the number of covered aircraft in accordance with the agreement,” Mesa said in the filing.
Is this right?

I thought Mesa was only flying 900's in US Airways colors.
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Old 04-08-2009, 07:46 AM   #3  
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There are a ton of 200's in Airways colors out of PHX.. and to the original poster, I've been hearing the end of Mesa for years... I'll believe it when I see it. They might reduce in size, but they won't completely go away... I know everyone wishes they will, personally I wouldn't wish that on any of my brother and sister pilots... The management sux the big one, but there are some very good people there.
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Old 04-08-2009, 08:07 AM   #4  
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2008 Airline Quality Report says Hawaiian is nation's best carrier
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Old 04-08-2009, 08:13 AM   #5  
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and who was the cellar dwellers for the 6th year in a row..............................................A SA!!!!!!!!!!!!!!!!!!!!!!!!! way to go guys.
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Old 04-08-2009, 09:33 AM   #6  
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Yea, thanks for that. And Mesa ranked above every other DCI carrier except Skywest...

Just because Mesa is selling its stake in a money losing venture, does not mean end times are near... that's just a ridiculous line of thinking.
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Old 04-08-2009, 11:08 AM   #7  
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Quote:
Originally Posted by AZFlyn1 View Post
They might reduce in size, but they won't completely go away... I know everyone wishes they will, personally I wouldn't wish that on any of my brother and sister pilots... The management sux the big one, but there are some very good people there.
Mesa's demise will be good for the overall picture but in the short term you're going to have another 1500 pilots on the street. Mesa is still in a lot of debt and it's a good thing they're in the survival mode now because for a while they were starting to look like they were impervious to the state of the industry. The end will be near if they actually send these extra 5 CRJs and 6 ERJs to HI and start charging 5 bucks a flight... or if they lose the case.
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Old 04-08-2009, 11:13 AM   #8  
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I feel so bad for JO. What a scumbag.
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Old 04-08-2009, 11:18 AM   #9  
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Originally Posted by Squeegee man View Post
I feel so bad for JO. What a scumbag.
It would be interesting if the latest bottom feeding TA will have made a difference, looks like the company was not as desperate as they made it out to be in NOV, what else is new.....
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Old 04-08-2009, 12:38 PM   #10  
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Janaury 30th, answer within 90 days.
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