LH buying 25% stake in B6

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I'm the dumb luck winner of the year recipient for 2007. On Tuesday, I bought a bunch of B6, thinking it had bottomed out. Today, thanks to this move by LH, over 20% return.
 
The article says it's roughly a 20 percent stake, not that it makes any difference. I wonder if they'll join the Star Alliance or if just LH will try to codeshare with them. I've been thinking that B6 would be a takeover target if mergers happen in the industry. If for no other reason than the low stock price, nonunion and they do not have a lot facilities that an acquiring carrier would need to get rid of, Mntc hangars, reservation centers, etc.
 
whatkindoffreshhell said:
Kinda amusing that LH chooses to invest in jetBlue instead of their Star partner UA!
Click to expand...
Perhaps UA is buying the other 75-80%. They've certainly got the cash to do so, although I imagine any bid from UA would be mostly, if not all, stock. And voila -- LH would then have an 8-10% stake in UA, with FWAAA having a slightly smaller holding.

Who knows if any of this is true. But it makes for some interesting speculation.
 
It's for real. Just issued within the hour:

Press Release
Source: JetBlue Airways Corporation

Lufthansa to Make Equity Investment in JetBlue; Will Buy Up to 19% Stake For $7.27 Per Share
Thursday December 13, 3:05 pm ET


NEW YORK and FRANKFURT, Germany, Dec. 13, 2007 (PRIME NEWSWIRE) -- JetBlue Airways Corporation (NasdaqGS:JBLU - News) and Deutsche Lufthansa AG (Xetra:WKN 823212) today announced an agreement for Lufthansa to make a minority equity investment in JetBlue. This transaction represents the first significant investment by a European air carrier in a U.S. point-to-point air carrier.

Under the terms of the agreement, which has been approved by the Boards of both companies, Lufthansa will purchase in a private placement approximately 42 million newly issued common shares of JetBlue, or 19% of JetBlue's equity after giving effect to the issuance. Lufthansa is acquiring the shares at a price of $7.27 per share, or a total of approximately $300 million, representing approximately a 16% premium to yesterday's closing price of $6.25.

The agreement provides that a Lufthansa nominee will be appointed to the Board of Directors upon the closing of the transaction. The Lufthansa nominee will be a Class II director and will be up for election at JetBlue's annual meeting in 2008.

``We are very pleased to become an investor in JetBlue,'' said Lufthansa Group Chairman and Chief Executive Officer Wolfgang Mayrhuber. ``Our investment reflects the confidence we have in JetBlue's quality, growth potential and management team. This investment presents Lufthansa with a compelling opportunity to invest in the U.S. point-to-point carrier market as the industry continues to evolve. The transaction links two airlines with international reputations for quality, innovation and a service culture.''

``We welcome this significant endorsement of JetBlue's franchise from one of the most respected leaders in global aviation,'' said Dave Barger, JetBlue's CEO. ``The agreement reaffirms our belief in JetBlue's disciplined growth plan and will also improve our balance sheet and give us greater financial flexibility as we move into 2008.''

Both airlines also look forward to exploring potential opportunities for further cooperation for the benefit of their customers. No specific areas of potential cooperation have been agreed upon.

JetBlue shareholder approval is not required in connection with the transaction, which is subject to regulatory review and approval, and is expected to close in the first quarter of 2008.


Note for journalists

JetBlue will conduct an investor conference call today, December 13, at 4:30 p.m. Eastern Time. A live broadcast of the conference call will be available via the internet at http://investor.jetblue.com

Tomorrow, 14 December 2007, 12 hours (CET)

Press conference at the Lufthansa Aviation Center (http://lac.lufthansa.com/de/index.php), Airportring, at Frankfurt Airport with Lufthansa Chairman and CEO Wolfgang Mayrhuber, Lufthansa CFO Stephan Gemkow and Dave Barger JetBlue-CEO;


The press conference will be available on the internet: click http://www.lufthansa.com/group
Click to expand...

Interesting development, for certain. I almost wonder if it sets the stage for one -less- domestic US Star Alliance partner.....
 
Cosmo said:
Perhaps UA is buying the other 75-80%. They've certainly got the cash to do so, although I imagine any bid from UA would be mostly, if not all, stock. And voila -- LH would then have an 8-10% stake in UA, with FWAAA having a slightly smaller holding.

Who knows if any of this is true. But it makes for some interesting speculation.
Click to expand...


I thought the same thing when I heard the news. Interesting times we live in.
 
LH's purchase is a bit of a head scratcher?!? Who knows what the big wigs in FRA are thinking but I'm sure they have a plan. It will be interesting to see how this pans out.
 
whatkindoffreshhell said:
Kinda amusing that LH chooses to invest in jetBlue instead of their Star partner UA!

BTW, is DTTB Tilton's new squeeze? Lover to hear his spin on this story.
Click to expand...


Oh no you didn't - LOL :lol: ..... Sorry, evidently his secretary is doing quite the job though... Well, I just read a couple of articles, and there is no doubt that UAL and LH Group work closely.. This would be a way to ensure that UAL ends up with B6 if they get hard pressed for a merger, and it would secure UAL and LHs presence in JFK/LGA market.. It is not hard to believe that LH would invest in B6 over UAL ... B6 is at rock bottom, if LH pressures B6 to merge with UAL then the stock will skyrocket and bing bang boom, More feed for LH,
UAL can retire some 737s and have a new airbii fleet with non union work groups and a major market the *A needs.... LH then can own a good portion of UAL... Very interesting indeed...
 
donttouchthebeauty said:
Oh no you didn't - LOL :lol: ..... Sorry, evidently his secretary is doing quite the job though... Well, I just read a couple of articles, and there is no doubt that UAL and LH Group work closely.. This would be a way to ensure that UAL ends up with B6 if they get hard pressed for a merger, and it would secure UAL and LHs presence in JFK/LGA market.. It is not hard to believe that LH would invest in B6 over UAL ... B6 is at rock bottom, if LH pressures B6 to merge with UAL then the stock will skyrocket and bing bang boom, More feed for LH,
UAL can retire some 737s and have a new airbii fleet with non union work groups and a major market the *A needs.... LH then can own a good portion of UAL... Very interesting indeed...
Click to expand...

This only goes back to Feb 2007 or before when i mention that United was probably going to enter back into JFK-LGA with JEtblue. Some people here didn't beleive it would ever happen. United is going to merge with A big carrier and by Using LH to buy into Jetblue this will hold jetblue later for another merge after we merge with a big carrier. This way nobody can buy jetblue with LH holding stake into them like Northwest with CO..... It's like a piece of the pie that will get bigger after the domino effects of the Delta-UA or US-UA or Co-UA... something is going to bust.

Its not if we are going to merge now its' called WHEN are we merging now.
Just a thought.
 
donttouchthebeauty said:
UAL can retire some 737s and have a new airbii fleet with non union work groups and a major market the *A needs.... LH then can own a good portion of UAL... Very interesting indeed...
Click to expand...
If UA aquired B6, B6's employees which are under 35% total of UA would fall under UA's unions and CBAs, there are not enough B6 employees to force a vote.
 
donttouchthebeauty said:
Oh no you didn't - LOL :lol: ..... Sorry, evidently his secretary is doing quite the job though... Well, I just read a couple of articles, and there is no doubt that UAL and LH Group work closely.. This would be a way to ensure that UAL ends up with B6 if they get hard pressed for a merger, and it would secure UAL and LHs presence in JFK/LGA market.. It is not hard to believe that LH would invest in B6 over UAL ... B6 is at rock bottom, if LH pressures B6 to merge with UAL then the stock will skyrocket and bing bang boom, More feed for LH,
UAL can retire some 737s and have a new airbii fleet with non union work groups and a major market the *A needs.... LH then can own a good portion of UAL... Very interesting indeed...
Click to expand...


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

beauty,

SEE, you've just proven the old saying...."Nobody is WRONG 100% of the time", meaning that your RIGHT about this being mostly about JFK ....!!
 
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