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Buy A Cheap US Airline!  
User currently offlineAerohottie From Australia, joined Mar 2004, 792 posts, RR: 3
Posted (9 years 7 months 1 week 2 days 3 hours ago) and read 2373 times:

I was just having a look at airline stock quotes on nasdaq.com and came across some rather interesting info. The market values for the US majors are incredibly low... here is what I found (I averaged the valuation to show the average valuation for the past 12 months to lessen any short-term variances)

US Airways UAIR $312,764,706
SouthWest LUV $13,827,950,000
Frontier FRNT $498,540,000
Continental CAL $1,025,000,000
NorthWest NWAC $1,080,325,000
AmericaWest AWA $598,230,000
Delta DAL $1,256,077,482
American AMR $2,516,250,000

I couldnt find the information I wanted on United, but I'm sure you get the picture.

At prices like this, it would mean that Delta, NorthWest and Continental have a market value similar to that of Air New Zealand!!!!

I was thinking... All it would take to buy Frontier, AmericaWest and US Airways is $1,409,534,706... how sweet is that!!! not like I have that, but still... at prices like this surely a cashed up company would take the risk, particularly in the more stable carriers (Frontier, Continental, NorthWest etc etc)

What do you all think??? Which would you like to buy (I know you dont have the money... so get a loan!!!)


What?
19 replies: All unread, jump to last
 
User currently offlineAerohottie From Australia, joined Mar 2004, 792 posts, RR: 3
Reply 1, posted (9 years 7 months 1 week 2 days 2 hours ago) and read 2288 times:

Perhaps BA could use the money they just got from their QF shares and buy half a US Major???
Makes you think huh



What?
User currently offlineCha747 From United States of America, joined Dec 2003, 781 posts, RR: 6
Reply 2, posted (9 years 7 months 1 week 1 day 18 hours ago) and read 2138 times:

If I had 1.5 billion dollars to buy those three, I'd try to cough-up another 0.7 billion to buy a space shuttle  Big grin


You land a million planes safely, then you have one little mid-air and you never hear the end of it - Pushing Tin
User currently offlineIowaman From United States of America, joined May 2004, 4312 posts, RR: 6
Reply 3, posted (9 years 7 months 1 week 1 day 16 hours ago) and read 2063 times:
AIRLINERS.NET CREW
FORUM MODERATOR

Just think, if Bill Gates wanted to he could buy all of those airlines plus UA and all the others! Big thumbs up


Next fights: WN DSM-LAS-PHX, US PHX-SJD. Return: US SJD-PHX, WN PHX-MDW-DSM
User currently offlineILSApproach From United States of America, joined Aug 2004, 410 posts, RR: 0
Reply 4, posted (9 years 7 months 1 week 1 day 15 hours ago) and read 2007 times:

The sweet deal I think was $3mil that it cost the new owners of SY to get re-started.

Four new 738's and debt wiped out.................now they are doing pretty good again here at MSP.

Wish I would of had $3mil laying around at the time.

Mike


User currently offlineUAL747DEN From United States of America, joined Dec 2003, 2392 posts, RR: 12
Reply 5, posted (9 years 7 months 1 week 1 day 15 hours ago) and read 1938 times:

Im sure that most of you probably know that you really couldn't buy the airlines for anything close to the prices listed here but I will just point it out for the people that don't.
Most of the time when someone starts buying up lots of shares then makes their intentions known that they are going to try to take over the airline the stocks immediately sky rocket. In the past stocks have been even known to double. The reason for this is that the stock holders want to make a higher gain and want you to have to buy them out for a lot more. This brings up another good point. When you are trying to "take over" a company by buying all of the stock you usually have to pay the current holders about 25-40% over the current value to encourage a sell off. With the very low prices of airline stock in the US today there is a lot of room for stocks to go up. A very well known attempt (although just a scam!) is when Donald Trump tried to take over American. I think the stocks were right around $84.00 a share and when it was made public that Trump was trying to take the company and was offering $120 per share the price jumped to a little over $120.00 per share. This could have happened because investors didn't want him coming in, or/and people wanted more than just $120 per share. (Later AA checked to see if Trump had financing lined up for the purchase because we all know that Trump has no "real" cash to speak of, and found that he did not and they turned him in for trying to inflate the stock and then sell *dont know what the official name for that is!* But he was found guilty and had to pay a fine and also the stock went down to about $60 per share when that came out and he had to sell the stock he bought for $80 at $60 and lost hundreds of millions of dollars with that little scam!)

Point is no you couldnt buy any airline for the current market value!



/// UNITED AIRLINES
User currently offlineLufthansa From Christmas Island, joined May 1999, 3197 posts, RR: 10
Reply 6, posted (9 years 7 months 1 week 1 day 15 hours ago) and read 1935 times:

Aerohottie

It wouldn't even take $1,409,534,706. Why? Because you only need to be a majority stakeholder to control a company.... you don't need 100%. You need 50% + 1 share. The obvious thing to do here would be to buy those carriers and then merge them..... but if your gonna folk out 1.4 billion dollars to buy the whole lot, I'd buy "controlling" interests in thsoe companies and then buy the controling interest in say, Delta. Actually this would work well because you could convert it to a LCC and eliminate some of the existing competition between DL and US on east coast "up and down" routes.

The cost structure of Frontier has to be applied throughout the whole new organisation, and if you can do this, I think it would be enough rationalisation to bring the organisation back to profits..... maybe even save Delta?


User currently offlineLufthansa From Christmas Island, joined May 1999, 3197 posts, RR: 10
Reply 7, posted (9 years 7 months 1 week 1 day 14 hours ago) and read 1924 times:

Dont forget:
When you take over a company like that, you also take over its debt!"
Also, when you buy large junks of shares, it has a positive effect on the stock price.


User currently offlineAerohottie From Australia, joined Mar 2004, 792 posts, RR: 3
Reply 8, posted (9 years 7 months 1 week 1 day 9 hours ago) and read 1814 times:

What really surprises me the very low values of these companies at the moment... they at the same level as Air New Zealand... which only has like 40 aircraft!!! Surely some cashed up company or individual could see this as being potential goldmine!!!.

Also rather than buying pre-established shares I would rather purchase just 50% plus 1 share of new stock... that way the company also gets an injection of much needed cash as well.



What?
User currently offlineMjszanto From United States of America, joined Dec 2003, 205 posts, RR: 0
Reply 9, posted (9 years 7 months 1 week 1 day 2 hours ago) and read 1674 times:

You guys have it wrong. When you are in bankruptcy as US Airways now is, the creditors own the airline until it emerges from bankruptcy. Stock is usually canceled at end of bankruptcy proceedings and new stock gets issued as with US Airways coming out of the first bankruptcy, and canceled at end of second proceedings, but in this case US Airways may not emerge ever from chapter 11.

American Airways stock is probably discounted based on fears of bankruptcy and off course the true value of American is stock value plus debt that you would assume.


User currently offlinePlanespotting From United States of America, joined Apr 2004, 3512 posts, RR: 5
Reply 10, posted (9 years 7 months 1 week 17 hours ago) and read 1586 times:

Southwest has a fair market value of nearly 550% over the nearest competitor (AA). P-I-M-P


Do you like movies about gladiators?
User currently offlineAa717driver From United States of America, joined Feb 2002, 1566 posts, RR: 13
Reply 11, posted (9 years 7 months 1 week 17 hours ago) and read 1564 times:

You schleps are thinking small time.

The goal is to gain control of the airline and then run the company down and buy the rest of the stock for pennies. Then, you sell off some assets, scam most of that cash, maybe file Ch.11 with you as the majority creditor, reissue stock(again, with you as the majority shareholder), perfume the pig so people will want to buy YOUR stock. Then keep skiming off cash from the huge flow airlines generate.

When it all falls apart, blame labor for not wanting to help save the company.

Then, a billion bucks richer, move on to your next vict...er, I mean "investment opportuity".

Sincerely,

Carl Icahn



FL450, M.85
User currently offlineStarlionblue From Greenland, joined Feb 2004, 16908 posts, RR: 67
Reply 12, posted (9 years 7 months 1 week 17 hours ago) and read 1543 times:

Aa717driver has it right, LOL.

As has been explained by UAL747DEN, nominal share price is not what you could buy the company for.



"There are no stupid questions, but there are a lot of inquisitive idiots."
User currently offlineMaddy From Germany, joined Aug 2004, 164 posts, RR: 0
Reply 13, posted (9 years 7 months 1 week 16 hours ago) and read 1519 times:

Hans Rudolf Wöhrl bought the German airline "Deutsche BA" for 1€ from BA.

But aren´t all the planes more worth than for example $312,764,706 (USAirways)? They have got about 282 airplanes. Or are they all written of?


User currently offlineTW741 From Liechtenstein, joined Sep 2004, 478 posts, RR: 0
Reply 14, posted (9 years 7 months 1 week 16 hours ago) and read 1516 times:

Aa717driver has it right, LOL
don´t forget to move as 1st step your HQ to Mt Kisco and charge as much rental as possible to your own airline....


if it would be that interesting to buy an airline there would be a lot of potential buyers around in the US ... maybe it got too risky just to fool around for the sake of getting a Richie Rich ...




TWA - we showed you how good we have been!
User currently offlinePROSA From United States of America, joined Oct 2001, 5577 posts, RR: 5
Reply 15, posted (9 years 7 months 1 week 16 hours ago) and read 1509 times:

Why buy an existing airline with all its debts and labor contracts? It would be a lot easier to pick up some nearly new aircraft and start your own. Still a high-risk venture, of course, but better than an acquisition.


"Let me think about it" = the coward's way of saying "no"
User currently offlinePlanespotting From United States of America, joined Apr 2004, 3512 posts, RR: 5
Reply 16, posted (9 years 7 months 1 week 16 hours ago) and read 1504 times:

and don't forget, buy a corporate jet and fly around in it rather then in the airline you just bought.


Do you like movies about gladiators?
User currently offlineAa717driver From United States of America, joined Feb 2002, 1566 posts, RR: 13
Reply 17, posted (9 years 7 months 1 week 14 hours ago) and read 1441 times:

Planespotting--OUCH! You must be an avid Ichan watcher. Big grin Taking it further, get a scumbag former V.P. of Flight Ops to fly your GIII(at the time) for commuter wages. I'm sure R.R. was proud of himself...TC


FL450, M.85
User currently offlineAerohottie From Australia, joined Mar 2004, 792 posts, RR: 3
Reply 18, posted (9 years 7 months 1 week 10 hours ago) and read 1350 times:

I guess the cheap price is due to th new owners having to take on the debt as well... but still... take for example that airline a has $8 billion in debt (aka US), and you can buy it for $400 million.. then fine buy it out right reduce its debt by half or many be more.. the company would save so much money that they would start making a profit and can then pay off its own remaining debt... the share price would skyrocket... the market likes profitable airlines aka SouthWest, JetBlue etc etc....you'll get your money back and then some.


What?
User currently offline7E72004 From United States of America, joined Mar 2004, 3587 posts, RR: 2
Reply 19, posted (9 years 7 months 1 week 10 hours ago) and read 1338 times:

Why don't we all just get together and put a down payment on one of those airlines!!  Big thumbs up


The next generation of aircraft is just around the corner!
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