jmhLUV2fly
Posts: 539
Joined: Tue Dec 14, 1999 4:15 pm

Question About CO & NW.

Sun Jun 02, 2002 3:30 pm

At work today I was speaking with a Northwest Airlink/jetlink agent and we were talking about among many things about Usairways and the trouble they could be facing along with pulling out of our city PNS also we spoke about Continental and Northwest, the NWA agent mentioned that Northwest owns continental, I had never heard that before and thought I would post the question and wanted to confirm that such is true, he said something about how they will own COA until October? News to me.
JMH
 
B747-437B
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RE: Question About CO & NW.

Sun Jun 02, 2002 3:44 pm

Rule #1 in life is to not believe most statements about corporate issues that are made by gate agents, flight attendants, rampers or pilots.

Northwest does not OWN Continental. They did own about 17% of Continental until January 2001, where Continental bought it back from them in exchange for preferred stock which gives Northwest veto power over any acquisition of Continental by a third party and some other benefits.
"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada
 
BR715-A1-30
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RE: Question About CO & NW.

Sun Jun 02, 2002 9:07 pm

Well, Tickle my Fancy. This is all news to me. I just thought NW and CO were doing Code-Sharing Agreements. Since when did NW own 17% of Continental?
Puhdiddle
 
777gk
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RE: Question About CO & NW.

Sun Jun 02, 2002 10:56 pm

Sean,

Great to see you back. Hopefully we will get a chance to chat next time I see you online.

You summed it up pretty well right there, NW still reserves the right to veto any merger, however their ownership in this company is currently nonexistent. Our alliance is contracted for another 19 years, so our independence is no sign of an impending divorce. Actually, quite to the contrary, we are looking to strengthen our ties with Northwest and continue to capitalize on their close relationship with KLM, particularly on North Atlantic routes.
 
zeus01
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RE: Question About CO & NW.

Mon Jun 03, 2002 4:27 am

Yes, NW did for a time own part of COntinental. Now they have preffered stock, which is even better. I think that gave NW enough votes to get some of there board directors onto Continentals.
 
Iflewrepublic
Posts: 511
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RE: Question About CO & NW.

Mon Jun 03, 2002 4:56 am

Correct me if I'm wrong, but I thought at one point in time, Northwest owned 51% of Continental Airlines...not 17%. I thought after Continental bought back the majority of its stock, Northwest was left with 17%. With a little help from Northwest, Continental has managed to make themselves look good again.

Iflewrepublic.
Aviation is proof that, given the will, we have the capacity to achieve the impossible.
 
SteveT
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RE: Question About CO & NW.

Mon Jun 03, 2002 5:06 am

Northwests shares in Continental had more voting power than the regular shares, which gave them more than 50% of the votes. When they bought the shares they had to agree to limitations on their use of that voting power.
 
Guest

RE: Question About CO & NW.

Mon Jun 03, 2002 5:43 am

JmhLUV2fly, it is good to see some fellow members from the Pensacola area. I, myself, have relatives in Gulf Breeze, so I travel to PNS many times per year. I might be going there in mid-July if you want to hook up. NW will never own CO. IMO the only reason CO joined with NW was to escape the clutches of DL in the early 1990s. Also, I think that PNS is severly underserved. I think that it would be good to have UA and AA come into play. The farthest west city that is served from PNS is DFW on DL. I would love to see a PHX, LAX, and SFO flight in the near future. But, I doubt it.
 
jmhLUV2fly
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Flight Level.

Mon Jun 03, 2002 2:58 pm

Good to hear you will be visiting the area soon, we have the best beaches and the best....uhhh, scenery in the world..haha.
As far as airline service to the area, yeah we could use more a few more airlines...Pensacola worked really hard in luring AirTran to the area, and thus far it has worked out for the best..its providing a competitive discount alternative for travelers and gave me a place of employment..several years back American and American Egle did serve Pensacola, in Feb 1992 AA began nonstop service between RDU using M80's...after a few months they started service to BNA using F100's....after about 8 months and that service proving to be non profitable they downsized to American Eagle and used Saab 340s...they continued serving Pensacola until October of 1996 when at that time they pulled out, which continues to amaze me..cause AA never gave the right route a chance if they had begun nonstop service to DFW I am certain AA would be still serving PNS...oh well...I think UA would do well here also, they did fly to MOB for a while using RJ's between ORD...but I understand that has been discontinued....TWA express at one time said they were going to fly here, but around August of last year called that off..now of course they are no longer an option.. Southwest is one carrier I think should consider the area but probably wont with FL here....at any rate we do pretty well...traffic remains at high levels...we have a great facility...glad you have chosen to visit the area....have a great time...
JMH
 
keesje
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RE: Question About CO & NW.

Mon Jun 03, 2002 9:42 pm

It's about the same as the KLM/NWA deal.

KLM a few years back had 17% of Co and the right to buy another 8% and more voting power. NWA bought back the shares and a good long term deal came out of it.

IMO KLM is are looking to strengthen their ties with NWA and continue to capitalize on their close relationship with Continental, particularly on Caribian and South America routes.

Confirmed today :

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/06-03-2002/0001739049&EDATE=
"Never mistake motion for action." Ernest Hemingway
 
sllevin
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RE: Question About CO & NW.

Tue Jun 04, 2002 12:11 am

Just to clarify... NW still owns 17% of Continental. Their ownership,however, is in the form of 'preferred' stock which is:

1) Not traded over the counter -- it must be 'converted' to 'common' stock to do so (and such conversion has limitations on how/when it can happen)

2) Non-voting except in areas regarding a sale/merger of CO

3) is held at a higher status than common shares in the case of a default; IOW, should CO go bankrupt, for example, and their assets liquidated, the creditors would receive their money, then the preferred stockholders, and, if there's enough to pay 100% of the preferred stock off in value, the remainder would be divided amongst the common shares.

In short, NW does very much own a piece of CO; it's just a 'passive' role.

Steve

 
Lt-AWACS
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Joined: Mon Jan 14, 2002 2:40 am

RE: Question About CO & NW.

Tue Jun 04, 2002 12:28 am

"Pensacola worked really hard in luring AirTran to the area, and thus far it has worked out for the best..its providing a competitive discount alternative for travelers and gave me a place of employment"

Didn't they get AirTran to switch from Ft Walton Beach (VPS). WHen I lived near Panama City in 2000, I had a friend fly AirTran out of Ft Walton, now it is no longer in that market. Did Air Tran switch to PNS???

Just curious.

also you can check the voting rights on COA and B shares that will help you understand the 'ownership' as explained above

Ciao and Hook 'em Horns,
Lt-AWACS
Io voglio fica ogni giorni da mia bella moglie!
 
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airzim
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RE: Question About CO & NW.

Tue Jun 04, 2002 6:06 am

KL never owned 17% of CO. Were you thinking of Air Canada?
 
Guest

RE: Question About CO & NW.

Tue Jun 04, 2002 6:10 am

Air Tran flies many times to PNS per day from ATL. I flew them 2 weeks ago PNS-ATL.
 
jmhLUV2fly
Posts: 539
Joined: Tue Dec 14, 1999 4:15 pm

RE: Question About CO & NW.

Tue Jun 04, 2002 3:23 pm

Yes, AirTran did provide service to Fort Walton Beach (VPS) up to the 5th of November last year, many still drive over from that area, Destin/FortWalton etc as they were loyal customers to FL in VPS, but there is a demand in Pensacola as well, with Pensacola Naval Air Station, business travelers and tourist along with a bigger and better facility, AirTran is certain to do well in PNS, at present AirTran has four flight a day to and from Atlanta, three of those flights are full or near full on a daily basis, especially flights 423/424 and 427/290 Hint: make your reservations early and check in at the airport early and all will be smooth flying.
JMH
AirTran Customer Service/Ramp Agent (PNS)

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