Air Tran Circling Rival?
A recent shelf registration by AirTran Airways Inc. has industry analysts wondering if the discount airline is preparing a bid for one of its rivals.
AirTran filed with the Securities and Exchange Commission earlier this week to sell up to $225 million in debt securities, preferred and common stock and warrants. The Orlando, Fla., company said it would use proceeds for general corporate purposes, which could include debt retirement, working capital or "acquisitions of other airlines or their assets."
While the language of the filing was routine, it has rekindled talk by some in the industry that AirTran might be pursuing a bid for Midwest Air Group Inc., parent of Midwest Airlines. Oak Creek, Wis.-based Midwest now flies from its Milwaukee hub to about 24 large cities nationwide, as well as to nine markets from Kansas City, Mo.
Midwest has a market capitalization of about $42 million and about $66 million in total debt. The airline carried more than 2.3 million passengers in 2004, according to the Bureau of Transportation Statistics, ranking it 32 among all carriers, including independent airlines serving as regional affiliates.