FL Group slashes AMR stake

[MiAAmi]

CHICAGO, Nov 30 (Reuters) - FL Group hf an Icelandic private equity group, said on Friday that it had cut its stake in American Airlines parent AMR Corp to 1.1 percent from 9.1 percent because management of the carrier had done too little to boost its value.

FL, which had pressured AMR to take steps to increase shareholder value, said in a statement that despite improved operations, AMR remained burdened by high fuel costs and a "tightening of the U.S. economic environment."

FL Group was one of the largest shareholders in AMR. In September, the company urged AMR to consider strategic alternatives, including spinning off its frequent flyer program to lift its share price, which has fallen 32 percent this year.

On Wednesday, AMR said it would divest its regional carrier, American Eagle. The news sent shares soaring 10 percent initially.

"The proposed spinoff (of) American Eagle is a move in the right direction, but the lack of clarity over timing, terms and valuation has done little to enhance value," FL Group said on Friday.

FL Group, which began its investment in AMR in 2006, said the divestment would hurt fourth-quarter earnings by about $32.5 million. The company said it had dumped 20 million shares. (Reporting by Kyle Peterson, Editing by Lisa Von Ahn)

 

[Hopeful]

Before you know it, this FL GROUP will be demanding that AMR screw the employees in contract talks.

 

[The Goose]

CHICAGO, Nov 30 (Reuters) - FL Group hf an Icelandic private equity group, said on Friday that it had cut its stake in American Airlines parent AMR Corp to 1.1 percent from 9.1 percent because management of the carrier had done too little to boost its value.

FL, which had pressured AMR to take steps to increase shareholder value, said in a statement that despite improved operations, AMR remained burdened by high fuel costs and a "tightening of the U.S. economic environment."

FL Group was one of the largest shareholders in AMR. In September, the company urged AMR to consider strategic alternatives, including spinning off its frequent flyer program to lift its share price, which has fallen 32 percent this year.

On Wednesday, AMR said it would divest its regional carrier, American Eagle. The news sent shares soaring 10 percent initially.

"The proposed spinoff (of) American Eagle is a move in the right direction, but the lack of clarity over timing, terms and valuation has done little to enhance value," FL Group said on Friday.

FL Group, which began its investment in AMR in 2006, said the divestment would hurt fourth-quarter earnings by about $32.5 million. The company said it had dumped 20 million shares. (Reporting by Kyle Peterson, Editing by Lisa Von Ahn)

I wondered who was doing that, the way the stock dropped for no apparent reason - had to be a dump. Now, with FL out of the way, Arpey and the frat boys can go back to mismanagement as usual with no outside interference.

FL would rather have seen AMR sell AAdvantage but the resulting dollars in the balance sheet's 'plus' column would have triggered major employee profit sharing and there was no way in hell that would be allowed to happen.

 

[FWAAA]

Good riddance to worthless garbage.

A great example of Buy High, Sell Low.

Losers bought lots of AMR as oil fell in price last winter. For a few weeks now, oil has been 50% more expensive than when AMR hit its peak of $41 in January. Whiners complain that AA wasn't moving fast enough to boost shareholder value. What a load of BS. Go work your investment magic elsewhere, you T Boone-Wannabes.

 

[will fix for food]

Good riddance to worthless garbage.

A great example of Buy High, Sell Low.

Losers bought lots of AMR as oil fell in price last winter. For a few weeks now, oil has been 50% more expensive than when AMR hit its peak of $41 in January. Whiners complain that AA wasn't moving fast enough to boost shareholder value. What a load of BS. Go work your investment magic elsewhere, you T Boone-Wannabes.

No kidding. Why AMR started making operational decisions based on what a hedge fund manager from Iceland wanted is beyond me. That being said, I doubt that this is over.

 

[The Goose]

Good riddance to worthless garbage.

A great example of Buy High, Sell Low.

Losers bought lots of AMR as oil fell in price last winter. For a few weeks now, oil has been 50% more expensive than when AMR hit its peak of $41 in January. Whiners complain that AA wasn't moving fast enough to boost shareholder value. What a load of BS. Go work your investment magic elsewhere, you T Boone-Wannabes.

Dammit - I was all ready to watch a proxy fight next year. Guess FL wised up and decided there was no hope for the USA airline industry.

The only 'shareholder value' AMR is concerned with is the value of the PUP payments to its management.

 

[The Goose]

No kidding. Why AMR started making operational decisions based on what a hedge fund manager from Iceland wanted is beyond me. That being said, I doubt that this is over.

It was evident from the beginning AMR's purpose in this was to throw FL a fish and perhaps they'd shut up, then hiring an outside consultant to figure how the execs could profit the most from any sale and not show enough on the balance sheet to trigger profit sharing for those lower on the food chain.

Perhaps its not over - there's blood in the water now and we all have seen how the frat boys operate.

 

[LGA Fleet Service]

Go work your investment magic elsewhere, you T Boone-Wannabes.

What, like their recent write offs in the subprime festival?

 

[Barfbag]

This Group has pulled it's lot because they see greener merger pastures in the likes of UAL, DL, NWA..

AMR is rock sold, at present, as its fortifies it's flanks, against the threat of a new leader rising, and the next phase of oil wars, downward pricing, and government regulators.

 

[TIME FOR CHANGE]

Good riddance to worthless garbage.

A great example of Buy High, Sell Low.

Losers bought lots of AMR as oil fell in price last winter. For a few weeks now, oil has been 50% more expensive than when AMR hit its peak of $41 in January. Whiners complain that AA wasn't moving fast enough to boost shareholder value. What a load of BS. Go work your investment magic elsewhere, you T Boone-Wannabes.

You cease to amaze me
I actually agree with you for a second time on this BB

They pressure AMR to sell the assets which crank out revenue for the company in order to increase cash on hand and the appearence of a better bottom line.

Sooner or later when the money making assets are all gone the airline goes bankrupt. But by then the people like FL Group have all ready cashed out and laugh all the way to the bank.

I dont agree with the sale of Eagle either it seems like PAA all over again

Time will tell

 

[Wretched Wrench]

I think AAL has been snookered.

 

[NewHampshire Black Bears]

I'm not happy(at this present time) about Eagle...............BUT......................One SURE thing I know about my former employer.

AA/AMR...does NOT.."take a crap", without a preplanned strategy.

I walked around for about a year after AMR dumped Sabre, thinking that the "sky was gonna' fall" !

Guess what ?............................................I was WRONG !!!