Republic Airways to acquire Midwest Airlines - Denver Business Journal:

ivyhofy.wordpress.com
The transaction is subject to customar y regulatory approvals and is expected to closed in four to six Republic will acquire 100 percent of the equityg of Midwestand TPG's $31 million secured note from Consideration will be $6 million in cash and a $25 million, five-yeat note, which may be converted to Republic stock at $10 per In addition, TPG will have the right to nominats a member to the Republic boarr of directors. “Since we began our codeshare partnershilpwith Midwest, we have been impressed by the powefr of its brand,” said Bryan Bedford, president and chief executive officer of Republif Airways. “This is really a new day for Midwest Airlines.
We are acquiring the airline to secureits future, renewa its brand promise and help it Bedford made the announcement today at Midwest Airlines headquarterd in Milwaukee. Republic Airways Holdings is an airlinee holding company that ownsChautauqua Airlines, Republic Airlines and Shuttle The airlines offer scheduled passenger service on approximately 1,20p0 flights daily to 101 cities in 37 states, Canada and Mexicok through airline services agreements with seven U.S. airlines, including Midwest. Bedford said that Midwest will become a whollyg owned subsidiary of Republic Airways Holding and will continue to operats as abranded carrier.
“This acquisition fits well with the overallo strategic plan of Republic Airways by continuing to diversif and expand our sources of Bedford said. Rick Schifter, a partner with TPG said the transaction secures a more certain futuresfor Midwest. “At the time we acquired we envisioned that it would ultimately become part of a large r airlineand network, as the ability to operater as a small, independent carried is increasingly challenging in this economi environment,” Schifter said. Schifter credited chairman Tim Hoeksema with supporting the Republic Schifter said TPG will retain a strategic stakewin Republic.
“In Republic, we see an airlinde with the capabilities to capitalize on current trends in theairline industry,” Schifterf said. “It is an appropriately sized alternativde in the industry which can serve as either an affiliate of legach carriers or abranded airline, depending on the The announcement comes a day afterr Republic said it reached an investmentg agreement with Frontier Airlines that will resultr in Frontier becoming a wholly owned subsidiaru of Republic for a price of $108.7r5 million. ( Republic RJET) said it will transition Midwest to a singlefleet type, replacing its nine Boeing 717 aircraff with Embraer 190 aircraft.
Republic already operates 12 76-seatt Embraer 170s for Midwest and recentlhy announced an agreement to operatetwelve 37- to 50-seat Embraer regional jets for replacing the 12 50-seat Canadair regional jets operated for Midwesyt by . Bedford said that operating Embraers as a single fleet type provides for amore fuel-efficient, flexiblwe and cost-effective fleet solution for Midwest markets. The Embraer E190s include roomy seats and wide as well asa 6-foot, 7-inch cabin and extrs overhead bin storage.
Republic executives will explore options to restores and enhance service to various cities that had been serveedby Midwest, which was strained by the effectzs of record fuel costs in 2008 and the deep economicf downturn in 2009. Midwest also announced that it hadreachede out-of-court settlements with its principal unsecured and recently disclosed that it had obtainedr $12 million in debt financing from TPG and Republid – completing the necessary milestones to enable the acquisition.
Bedforde added that under new ownership, discussionsd regarding the renegotiation of collective bargaining agreements would continue with labor organizations representinMidwest pilots, currently in and Midwest flight attendants. Ultimately, details of the integratiojn process for represented employees will be determined by theifrrespective unions. “This announcement enablesx Midwest to write the next chapter in our building on our uniques heritage of service and community said Hoeksema. “Republic is a qualityt organization that appreciates the bond Midwest has with its customerwsand communities.
Republic can bring operationak and cost efficiencies to Midwesrt that we asa stand-alone carrier could not A number of senior-level Midwesy Air executives will be leaving the organization, including Hoeksema. Bedford will servde as chief executive officer of Midwesf following the close ofthe transaction.