As we have said from the beginning, if AirTran was going to have a shot at getting Midwest Airlines — they would have to up their offer.
Monday, they did.
AirTran Holdings Inc. announced it had increased its hostile offer to purchase all of the outstanding shares of Midwest Air Group Inc. to $15 per share. The offer consists of $9 in cash and 0.5842 of a share of AirTran common stock for each Midwest share. The total equity value of the exchange offer is estimated at $389 million.
Interesting timing in that the move by AirTran seems clearly to coincide with Midwest’s record date for voting proxies, which closed with the close of trading today.
It’s clearly a duel of the institutional investors versus the retail investors here.
But, as we have said before, we believe this ad-venture is ill-advised for the folks at AirTran. Both from a macro (economic cycle) and micro (their own current financial performance) viewpoint.
Shouldn’t that be “AirTran coughs up the dough”?
I still give this “deal” a slim chance of success.
Duh. Yes. (Has now been changed)
Well, it all depends on whether AirTran can get enough shares in the hands of funds who support their effort, because I would think the bulk of the retail shares are in the hands of Midwest loyalists.