Alaska Air

[BoeingBoy]

Bud8EE,

Actually, I'm just letting him enjoy his little fantasy - for now.....

Jim

 

[robbedagain]

who or what is barbell aquisiton of delaware and what do they do?

 

[funguy2]

AS: MD80's, 734's 737NG's
HP: IAE Airbuses, 733, 734, RR 757's
US: CFM Airbuses, 733, 734, RR 757's, GE 762's A330's

Correction: HP has no 734's - never did. They have retired all of their 73S. So, HP's only 737 variant is the -300 (733). That said, I believe some of HP's are ex-US. I believe HP has some 737-3B7 and 737-301, the B7 and 01 being Boeing customer codes for US Airways (i.e. the old USAir) and Piedmont respectively. So I imagine they are a good fit.

Planespotters.net

 

[delldude]

who or what is barbell aquisiton of delaware and what do they do?

[post="275119"][/post]​

owned by arnold schwarzenegger?

 

[savyinvestor]

Jim, there is no question as to who is more respected on this board! Savy

 

[funguy2]

How is Alaska going to offer $7/share for AWA, pre-merger, as reported by Business Week, when AWA is currently trading at almost $6.50/share?

AWA has had a nice runup in recent days, and $7/share simply won't cut it. Maybe this was an ok idea prior to the merger announcement when AWA was trading at $4/share. But today, an acquisition of AWA would seem to cost at least $10/share, if not more.

 

[FWAAA]

OK, I gotta call you on this one. Can you detail who is putting $1.65B into this company? And don't count the cash that the companies already have or the existing equity in HP. That number you are using is pure fiction.

[post="275081"][/post]​

I gotta agree. No way do you get anywhere near that sum unless you add the existing cash balances of US and HP, and those aren't really "new equity."

People have repeatedly asked for an itemization, and none has been provided.

So far, only several hundred million, and some of that was previously announced (Air Whiskey and others) to be invested in U prior to the HP announcement.

The only thing that's stunning so far is the diminutive amount of announced new money to be invested in this enterprise.

 

[North by Northwest]

Careful AS...Wn just might take you out. End of story. Then again you could see WN swoop in on AirTran/ jetBlue. Checkmate. Battle of the LCCs.

 

[FWAAA]

The point of US Airways and America West deal (and why people are willing to provide about $1.65 billion to the new company) is to generate revenue synergy and cost cuts with no cost increase in total labor expense. That would be tough and probably impossible to do with Alaska, which has much different contracts than US Airways and America West.

[post="275074"][/post]​

According to this morning's PP-G, the total amount of new money is only $500 million, a long way from the fabricated $1.65 billion. Why the discrepancy?

Wellington and four other investors would end up with a 49 percent share, according to new documents filed yesterday with the Securities and Exchange Commission, up from 41 percent originally due the first four -- Air Canada, PAR Capital Management, Peninsula Investment Partners and Air Wisconsin Airlines.

All told, the five investors are providing $500 million in new equity.

http://www.post-gazette.com/pg/05154/514962.stm

Not quite stunning. Not stunning at all.

 

[mwereplanes]

Wow you violated ALPA's trust. An entity consisting of over inflated ego's using it as ladder climbing tool or people with chronic back problems that will sell out others in the foxhole as long as they make they cut. An ALPA who has a growing number of DFR lawsuits. An ALPA that writes hyperbole about protecting the profession, while ingoring the W2 facts of it going backwars. An ALPA that ignores issues like professional negotiaters(a top dollar independant law firm, not an ALPA hack) , a national seniority list or a national contract. An ALPA that has no clue of why things are going backwards or if they do, don't have the collective will to institute the polocies that would counter the effects of deregulation, a competive industry, and greedy shortsighted nature of pilots. i.e, national contract and seniority lists. Wow, good on you Jim.

[post="275103"][/post]​

ALPA does not have the collective will because of shills like 320. He and his ilk have allowed opportunistic management teams across the industry to degrade a profession into just another job. They have no pride in the profession and are willing to go ever lower in order to continue to "fly". Not just 320 but a ton of other guys like him at each and every carrier. It is truly disgraceful.

But ALPA will continue to allow this degradation to occur because it is only as strong as it's members. Members who truly don't understand that the profession is not just a job. Selfishness among pilots is extraordinary. Truly is. And you can see it by watching what they are willing to accept to keep flying.

mr

 

[BoeingBoy]

who or what is barbell aquisiton of delaware and what do they do?

[post="275119"][/post]​

Barbell Acquisition is a proposed new division of US. When all is said and done, as proposed, Barbell would be the surviving corporate entity and the name would be changed to America West Holdings.

On another note - the reported price AS would pay to purchase the "new" America West Holdings via stock sway - the investors are paying the equivalent of $15 ($16.50 for Wellington) for their "new" shares of the combined HP/US according to filings.

Whether they would accept $7 or even $10 in AS stock in exchange is an open question. Of course, they're paying well over the current price of HP stock, too. That good ROI they're supposedly counting on will take a big run-up in price.....

Jim

 

[funguy2]

I think the new cash falls out as follows:

$100mil PAR Investments
$150mil Wellington Investments
$50mil Penisula Investments
$75mil ACE - Air Canada
$125mil Air Wisconsin/Eastshore
-------
$500mil new equity

$250mil new debt (Airbus)

$233mil HP Cash/ST Investments (March 31, 2005)

$513mil US unrestricted cash ($768mil restricted)

$1496mil total liquidity. The additional to get to $1625mil must be expected cash increases, potential asset sales (i.e. MDA/slot/Republic deal), "un-restricting" some of US' restricted cash, and/or a mentioned rights offering.

$500mil (plus any rights offering, I think) would be considered new equity.

That's my take anyways.

 

[funguy2]

Boeing Boy:

Just to be clear...

Current AWA stock is trading near $6.50. ALK, from what I read, would acquire the existing AWA stock for $7/share, according to the article. That's not enough IMO... $10 may not be enough.

Then, the existing AWA shares (whether owned by ALK or existing investors) would trade in their AWA shares for the "Barbell" shares, with an assumed value of ~$15/share, at some exchange rate. If ALK were to do this, and acquire all AWA shares, they would only end up owning 39% of "Barbell". Seems like something is missing from that article.

 

[BoeingBoy]

funguy,

On your list of liquidity:

$100 million of the $500 million in investment has already been received (the Air Wisconsin DIP loan), so it's not "new liquidity" since it's already in US's unrestricted cash.

The $513 million in US unrestricted cash is really not unrestricted - it's ATSB cash collateral. Time will tell how much if any of that is truly unrestricted after emergence from BK (or even after June). It could range from $0 cash collateral to the pre-BK $700 million plus.

So at a minimum, you need to take $100 million out of your total to keep from counting it twice (in investments and US unrestricted cash). At worst, your total could be reduced by as much as $800 million plus.

On the AS thing, my assumption was that AS would consummate the HP purchase after the proposed HP/US combination had occured, so that the stock swap would be for "new" HP shares. But that was just my assumption and could definitely be wrong.

Jim

 

[RowUnderDCA]

I think the new cash falls out as follows:

$100mil PAR Investments
$150mil Wellington Investments
$50mil Penisula Investments
$75mil ACE - Air Canada
$125mil Air Wisconsin/Eastshore
-------
$500mil new equity

[post="275147"][/post]​

Notice how the investments come in neat $25 million increments. HMMMMM?

$50
$75
$100
$125
$150.

I predict the next investment will be either $175 million or $25 million.