AirTran extends bid deadline for Midwest

AirTran extends bid deadline for Midwest

	Published : Thu, 01 Feb 2007 19:27 By : Agencies Print this Story

ORLANDO, Fla. (AFX) - AirTran Holdings Inc., which operates low-fare air carrier AirTran Airways, on Thursday extended by one month its offer of $345 million in cash and stock for Midwest Airlines' parent company.

Originally due to expire Feb. 8, Midwest Air Group Inc. shareholders now have until March 8 to consider the offer.

Orlando-based AirTran said that it decided to extend its offer so that Midwest's shareholders can receive all the information they need.

The Milwaukee-based company's board on Thursday reaffirmed its recommendation that shareholders reject AirTran's offer. Last month, Midwest called AirTran's latest offer 'inadequate.'

Midwest officials referred to profits in the last three quarters of 2006 as evidence of the carrier's strength.

Midwest's outlook is an 'extremely optimistic projection,' AirTran officials said.

In a letter sent to Midwest shareholders Thursday, AirTran cited Midwest's net loss of $126 million during the past five years and greater competition from other airlines as reasons to accept the offer.

'How far is the current Midwest management willing to go to convince Midwest stakeholders that its deeply flawed stay-the-course plan is superior to AirTran's, despite the contrary evidence that shows that the combination would create scale, efficiencies and growth opportunities far beyond what Midwest could achieve independently is something all Midwest shareholders should ask,' said Joe Leonard, AirTran's chairman and chief executive officer, in a statement Thursday.

AirTran also said it plans to nominate three new members to Midwest's board at the airline's next annual meeting of shareholders.

'While this slate of director candidates, if elected, will not constitute a majority of the members of the board, we believe it is vital that the Midwest shareholders' interests be represented inside of the boardroom,' Leonard said.

Midwest said AirTran had made the nominations in hopes its representatives could push as Midwest board members for a sale of Midwest to AirTran.

AirTran disclosed in mid-December that it had first bid $11.25 per share on Oct. 20 for Midwest Air Group, but Midwest turned down the $290 million offer on Dec. 6. AirTran then upped the ante last month, offering shareholders $13.25 a share in cash and stock.

AirTran shares fell 2 cents to $11.05 in afternoon trading on the New York Stock Exchange. Midwest rose 3 cents to $13.38 on the American Stock Exchange.