SpencerII
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Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:15 am

Interesting blurp from Air Transport World about YX executives payouts. Wonder how long it will be before Hoeksema heads to another carrier?



Midwest Airlines' recent sale to investment firm TPG Capital will result in hefty payouts of stock and cash to carrier executives, the Associated Press reported. Chairman Tim Hoeksema reportedly will receive more than $10 million in cash and stock while VPs Carole Skornicka and David Reeve are in line for $1.6 million each. CFO Curtis Sawyer and VP Scott Dickson will receive about $1 million each. Northwest Airlines is the largest shareholder in the TPG acquisition.


by Sandra Arnoult
 
phxtravelboy
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:43 am

All good ole Timmy was doing was looking out for himself. He could care less about the employees. Pretty damned sad. To all of the people on here that were SO against the merger with FL, I'm very curious to see their reaction to this one. Timmy new he'd be out with a merger with FL, so what does he do? Save his own a**. The FL merger would have been the best thing for YX and MKE.
 
L-188
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:03 pm

Quoting SpencerII (Thread starter):
David Reeve are in line for $1.6 million each

Too bad his daddy's old airline isn't around for him to invest in. His brother Dick ran it into the ground.
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AA737-823
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:13 pm

As soon as I saw the Reeve name, I wondered if it was the same family.

But anyhow, you guys jump on this so quickly, but how do we know there wouldn't have been a similar payout if any other company had bought out YX? Like, for example, FL instead of TPG?
 
LASoctoberB6
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:37 pm

Quoting L-188 (Reply 2):
Too bad his daddy's old airline isn't around for him to invest in. His brother Dick ran it into the ground.



Quoting AA737-823 (Reply 3):
As soon as I saw the Reeve name, I wondered if it was the same family.

what airline did he "run into the ground"? and aside from the execs payout, what is this merger with TPG all about? will fleet and livery change?
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SkyexRamper
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:41 pm

Quoting SpencerII (Thread starter):
Wonder how long it will be before Hoeksema heads to another carrier?

It would be in his best interest to stay around as long as he can. If you read the story in the JournalSentinal, they state that if Midwest is sold off again, that Timmy would get an even large payout on top of this $10M.

Quoting L-188 (Reply 2):
Too bad his daddy's old airline isn't around for him to invest in. His brother Dick ran it into the ground.

Which airline would that be?

Quoting Phxtravelboy (Reply 1):
He could care less about the employees. Pretty damned sad.

 stirthepot   bigthumbsup 

Timmy had the crap scared out of him the night before FL made their last stand, so he picked up the phone and called in his favorites. There was a nice article in the newspaper, US TODAY I believe it was, that detailed the final moments of the deal.
Good Luck to all Skyway Pilots! It's been great working with you!
 
SpencerII
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:45 pm

Quoting Skyexramper (Reply 5):
Which airline would that be?

The Reeve name is real big in aviation history past. Reeve Aleutian Airlines..

http://www.aviationhalloffamewisconsin.com/inductees/reeve.htm
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:50 pm

Quoting Phxtravelboy (Reply 1):
The FL merger would have been the best thing for YX and MKE.

I agree 100%, but you have to hand it to a spinmaster who can convince his home town that more flights are a bad thing.

Unbelievable.
 
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LAXintl
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:56 pm

Quoting AA737-823 (Reply 3):
but how do we know there wouldn't have been a similar payout if any other company had bought out YX?

With FL, he'd probably simply get a severance package with his walking papers, unlikely anywhere even close to the TPG payoff.

The vehement opposition to FL displayed by the YX management team should have tipped people off that they were not quite acting out of love and interest in simply wanting the best for the airline.
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SkyexRamper
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 12:56 pm

Here is the JS article:
http://www.jsonline.com/story/index.aspx?id=666505

Quoting Quickmover (Reply 8):
Quoting Phxtravelboy (Reply 1):
The FL merger would have been the best thing for YX and MKE.

I agree 100%, but you have to hand it to a spinmaster who can convince his home town that more flights are a bad thing.

Unbelievable.

I will be the first to publicly admit one thing. I would give the Man of the Year award to Timmy for the title of Best Marketing Strategy. Not everyone could have controlled the thoughts of soo many people.


Everyone should get a kick out of this...
http://www.jsonline.com/story/index.aspx?id=661959




From the above link:

"Extraordinary measures"

Darryl Jenkins, an aviation professor at Ohio State University, said Hoeksema's decision to turn to Northwest shows he was willing to take extraordinary steps to fight AirTran.

Northwest has long been Midwest's biggest rival, and in 2003, it greatly increased departures from Milwaukee in a failed effort to take a large chunk of Midwest Air's business.

"Hoeksema saved his job," Jenkins said. "That's the bottom line."

Scott Hamilton, who operates Leeham Co., an airline industry consulting firm in Issaquah, Wash., made similar comments.

"It was all about self-interest for management," Hamilton said.

Carol Skornicka, Midwest Air senior vice president of corporate affairs, said Hoeksema was thinking only of how he could get more value for shareholders when he contacted Steenland.

"It was believed there would be greater value" for Midwest if there was an alternative to AirTran, she said.

[Edited 2007-09-27 06:04:27]
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SkyexRamper
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 1:05 pm

Read those articles and tell me where it says that this deal was in the best interest of the employees.
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MKENut
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 9:03 pm

I wouldn't exactly call it a pay out. Tim is getting 10 Million dollars because that is what the stock he owns will be worth once TPG/NWA deal is finalized. I think he would have received more with the AirTran deal. Cash for MEH Stock, AAI Stock and a severance package. I still don't buy the argument that Tim only wants to save his job. He is close to retirement age and plenty of money to retire on already.
 
daus
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:14 pm

Quoting AA737-823 (Reply 3):
but how do we know there wouldn't have been a similar payout if any other company had bought out YX?

Yes, the headline if FLhad bought YX would have been "Midwest Execs Get Huge Payouts"... sound familiar?  Smile

I know it's not as fun for the a "I Hate Management" crowd, but this is about executives selling stock they own. The only difference for Hoeksema is that he got about 6% more from TPG then he would have from AirTran. Why? Because he drove the offer higher. Which, errr... is his job for the shareholders. Every employee who was smart enough to hold their stock options to the end got the same deal as Tim.
 
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JBo
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:27 pm

Quoting Phxtravelboy (Reply 1):
The FL merger would have been the best thing for YX and MKE.

A matter of opinion. No solid proof one way or another to show which would be better. However, there is much evidence of FL's past heavy expansion attempts to only scale them back plus their lack of success having a regional carrier. For TPG, there's much evidence of them taking struggling airlines and turning them into successful operations.

Quoting LASOctoberB6 (Reply 4):
what is this merger with TPG all about? will fleet and livery change?

No livery changes, and the only fleet changes will likely be the long-awaited MD-80 replacement. All TPG is doing is taking Midwest into a privately held company.

Quoting Daus (Reply 13):
I know it's not as fun for the a "I Hate Management" crowd, but this is about executives selling stock they own. The only difference for Hoeksema is that he got about 6% more from TPG then he would have from AirTran. Why? Because he drove the offer higher. Which, errr... is his job for the shareholders. Every employee who was smart enough to hold their stock options to the end got the same deal as Tim.

Exactly. In this case, Timmy is getting his payout as a shareholder. Anyone else who had large amounts of MEH stock get the same thing.
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EXAAUADL
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:30 pm

Quoting Phxtravelboy (Reply 1):
good ole Timmy was doing was looking out for himself. He could care less about the employees. Pretty damned sad. To all of the people on here that were SO against the merger with FL, I'm very curious to see their reaction to this one. Timmy new he'd be out with a merger with FL, so what does he do? Save his own a**. The FL merger would have been the best thing for YX and MKE.

100% agree....it was clear that one of the reasons YX mgmt was so opposed to a merger was personal gain.
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:36 pm

Quoting Daus (Reply 13):
Why? Because he drove the offer higher. Which, errr... is his job for the shareholders

I remember in the beginning of this buyout process, Tim and Carol claimed the buyout price wouldn't be the only consideration. They were more concerned with stakeholders not shareholders, cookies and independenance, not Airtran's hub growth. They claimed FL's plans were overly ambitious and the market would not support those growth levels. Suddenly shareholder value is front and center, as long as Tim stays on.

Well Tim won't have to worry about Midwest growing too fast now. When your 47% owner has it's main hub 247 miles to the East and their second biggest hub 240 miles to the West, don't be concerned with too much capacity in the MKE market. It won't happen.

Oh I forgot. NW did say they would stay out of YX decisions. I'm sure they will finance a Midwest expansion to compete with themselves.
 
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RE: Midwest Execs Get Huge Payouts

Thu Sep 27, 2007 11:49 pm

Quoting SkyexRamper (Reply 10):
It was all about self-interest for management," Hamilton said.

I flew YX in July and the one thing I noticed was the employess seemed ambivlient about a FL take over. Unlike DL where the employess showed their distate for a US take over
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 12:04 am

Quoting EXAAUADL (Reply 16):
I flew YX in July and the one thing I noticed was the employess seemed ambivlient about a FL take over.

You're right. They would have kept their jobs and eventually moved into 737 positions (60 more to be delivered). FL made it clear from the beginning that YX senior management would not keep their jobs. That was the problem.
 
Crewchief
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 12:58 am

These "I hate Tim and [insert biased attack mode comments] thread is getting old. Other than allowing someone to blow off steam, does it have any use?

Can we leave this behind and resume our regularly scheduled programming?
 
dw9115
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 1:00 am

Theses payouts are nothing new.
 
N77014
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 1:04 am

Quoting Quickmover (Reply 17):
Quoting EXAAUADL (Reply 16):
I flew YX in July and the one thing I noticed was the employess seemed ambivlient about a FL take over.

You're right. They would have kept their jobs and eventually moved into 737 positions (60 more to be delivered). FL made it clear from the beginning that YX senior management would not keep their jobs. That was the problem.

So are YX employees' job security any better/worse with the deal?
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quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 1:23 am

Quoting N77014 (Reply 20):
So are YX employees' job security any better/worse with the deal?

Just a guess, but I could see Midwest operations gradually scaling back and NW flights substituted. Midwest will be effective in keeping out new players on a big scale (Airtran's proposed connecting hub), but eventually I could envision alot of flights transitioning to NW as they take delivery of more rjs.

YX employee job security with FL would have been much better because of FL's large 737 order and their needing a connecting hub to base them at (MKE, MCI). NW has no need for another connecting hub in the Northcentral U.S. They already have two. MKE will eventually become a NW focus city. The NW connections will still go through MSP and DTW.
 
Mainland
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 1:51 am

Quoting MKENut (Reply 11):
I think he would have received more with the AirTran deal. Cash for MEH Stock, AAI Stock and a severance package.

Bingo. The severance package alone would've been around $4 million. Add a couple hundred thousand in stock options or restricted stock that would've immediately vested for cash on top of the shares held outright and more was to be made with AirTran.
You don't need a passport to know what state you're in...
 
EXAAUADL
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 2:25 am

Quoting N77014 (Reply 20):
So are YX employees' job security any better/worse with the deal?

I think what it shows is that YX mgmt wasnt sincere when they were makign their points about why YX should remain independent
 
Cubsrule
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 2:34 am

Quoting Quickmover (Reply 21):
Just a guess, but I could see Midwest operations gradually scaling back and NW flights substituted. Midwest will be effective in keeping out new players on a big scale (Airtran's proposed connecting hub), but eventually I could envision alot of flights transitioning to NW as they take delivery of more rjs.

This benefits TPG how? TPG has used airline partners for airline investment before. It has never happened. I'm sorry you love FL, but you need to get over it.

Quoting Quickmover (Reply 21):
YX employee job security with FL would have been much better because of FL's large 737 order and their needing a connecting hub to base them at (MKE, MCI). NW has no need for another connecting hub in the Northcentral U.S. They already have two. MKE will eventually become a NW focus city. The NW connections will still go through MSP and DTW.

Job security might have been better for a while. What about when the MKE hub failed?
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quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 3:10 am

Quoting Cubsrule (Reply 24):
Job security might have been better for a while. What about when the MKE hub failed?

If FL took over YX, so they were not competing for the same customer. FL's costs being less. FL's fares being less. FL being profitable consistantly for the last several years.

Why would the MKE hub fail?
 
MKENut
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 3:16 am

Quoting Quickmover (Reply 25):
Why would the MKE hub fail?

On the other hand, why would YX fail without FL? They've been around 20+ years with the odds stacked against them.
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 3:29 am

Quoting MKENut (Reply 26):
On the other hand, why would YX fail without FL? They've been around 20+ years with the odds stacked against them.

I don't think they would have failed immediately. They didn't have the aircraft to expand and the manufacturers are backed up for several years. I just think the FL/YX synergy would have been great. YX needed planes and had a great hub to fly them from and FL had the planes but needed the hub.

NW doesn't want YX to immediately go away. YX will stay about the size they are for now to keep the FLs and WNs of the world out of MKE on a big scale. Mark my words though, MKE will eventually be a NW focus city served primarily by compass rjs. There will be little of no connecting banks, just o/d traffic and just enough to keep any serious competition out.
 
Cubsrule
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 4:14 am

Quoting Quickmover (Reply 27):
Mark my words though, MKE will eventually be a NW focus city served primarily by compass rjs. There will be little of no connecting banks, just o/d traffic and just enough to keep any serious competition out.

How is that bad for MKE? It's essentially what YX offers now. Could you maybe point to some cities to which MKE would lose service with a large NW focus operation?

Quoting Quickmover (Reply 25):
Why would the MKE hub fail?

In many markets, FL proposed a level of service that would have relied upon only 20-25% local traffic. This is not sustainable. Also, even though LCCs and RJs apparently do not mix, FL proposed a large RJ presence.
I can't decide whether I miss the tulip or the bowling shoe more
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 4:44 am

Quoting Cubsrule (Reply 28):
How is that bad for MKE?

Not a problem at all if you don't mind higher fares, less frequency than a connecting hub, and flying rjs most of the time.

Quoting Cubsrule (Reply 28):
Could you maybe point to some cities to which MKE would lose service with a large NW focus operation?

Small cities in the WI, MN, MI areas would be hard pressed to justify service to MKE and MSP or DTW. More likely MKE passengers would connect on the MSP or DTW flights.
 
Cubsrule
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 4:55 am

Quoting Quickmover (Reply 29):
Small cities in the WI, MN, MI areas would be hard pressed to justify service to MKE and MSP or DTW. More likely MKE passengers would connect on the MSP or DTW flights.

That would be BETTER for the small cities; in most (all?) cases, the local market to MSP (west of the lake) or DTW (east of the lake) is larger, and connecting opportunities are better at the NW hubs. I can assure you that the 328s, as much fun as they are to fly, are not luxurious airplanes.

Quoting Quickmover (Reply 29):
Not a problem at all if you don't mind higher fares, less frequency than a connecting hub, and flying rjs most of the time.

If we use IND as a rough measuring stick, it's not at all clear that frequency would decrease, and I think it's' a safe bet that any NW focus operation would include much more than 50 seat CRJs (just as IND likely will as 175s and -705s come online).
I can't decide whether I miss the tulip or the bowling shoe more
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 5:05 am

Quoting Cubsrule (Reply 30):
That would be BETTER for the small cities; in most (all?) cases, the local market to MSP (west of the lake) or DTW (east of the lake) is larger, and connecting opportunities are better at the NW hubs. I can assure you that the 328s, as much fun as they are to fly, are not luxurious airplanes.

That's probably right, but I'm just thinking about making a connection vs. the nonstops you have now. I'm not a 328 fan either, but if I lived in MKE and had a choice between a 328 nonstop or connecting in DTW on a E175, I would want to get there quicker.

This deal could play out alot like TWA with ORD and DFW on both sides of STL. Alot of cities that TWA customers were used to flying nonstop, they now have to go through DFW or ORD.
 
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TVNWZ
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 5:26 am

Quoting Laxintl (Reply 8):
With FL, he'd probably simply get a severance package with his walking papers, unlikely anywhere even close to the TPG payoff.

Yes, a big 4-million package PLUS the stock vesting buy out.

Quoting MKENut (Reply 11):
wouldn't exactly call it a pay out. Tim is getting 10 Million dollars because that is what the stock he owns will be worth once TPG/NWA deal is finalized. I think he would have received more with the AirTran deal

But he would have been out of work. Now, he gets the value of his stock--which he deserves--plus he will get equity (stock) in the combined company. when/if TPG sells to NW or someone else, he will get another payout. In the long run this deal will be worth more to him.

Quoting EXAAUADL (Reply 16):
flew YX in July and the one thing I noticed was the employees seemed ambivliient about a FL

i fly them all the time (MME) and I have noticed the opposite. They loathed AAI. They are cheerier now.
 
Cubsrule
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 6:08 am

Quoting Quickmover (Reply 31):
I'm not a 328 fan either, but if I lived in MKE and had a choice between a 328 nonstop or connecting in DTW on a E175, I would want to get there quicker.

True, but aside from OMA, YX doesn't really offer p2p service from any of the smaller markets, and there isn't a real big local market in MKE to any of them.
I can't decide whether I miss the tulip or the bowling shoe more
 
N822ME
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 8:10 am

Quoting Quickmover (Reply 21):
YX employee job security with FL would have been much better because of FL's large 737 order and their needing a connecting hub to base them at (MKE, MCI).

Would I care as much about job security when my seniority went to zero?

Would those YX ALPA pilots do as well when they are tacked to the bottom of the FL NPA seniority list? And many find their way back to reserve... in Atlanta?
 
L-188
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 11:08 am

Quoting Skyexramper (Reply 5):
Which airline would that be?

This one.....


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Quoting LASOctoberB6 (Reply 4):
what airline did he "run into the ground"?

I didn't say David did, but it was his older brother Dick
OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
 
quickmover
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 11:40 am

Quoting N822ME (Reply 34):
Would I care as much about job security when my seniority went to zero?

Would those YX ALPA pilots do as well when they are tacked to the bottom of the FL NPA seniority list? And many find their way back to reserve... in Atlanta?

Where do you rank on Northwest's?
 
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knope2001
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 7:47 pm

I'm curious to know at what point a Midwest thread will NOT turn into sour grapes about AirTran's failed buyout attempt.

Anyone care to guess?
 
MKENut
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 8:08 pm

Quoting TVNWZ (Reply 32):
They loathed AAI. They are cheerier now.

You are correct. I know a few YX employees and they say morale is up since FL is no longer pursuing YX.

Quoting Knope2001 (Reply 37):
I'm curious to know at what point a Midwest thread will NOT turn into sour grapes about AirTran's failed buyout attempt.

So true Knope2001 and I get pulled into it everytime. So I am guilty of OT discussion too. I'm hoping after the TPG merger is complete we can talk just about Midwest in a Midwest Thread.  Smile
 
N822ME
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 8:20 pm

Quoting Quickmover (Reply 36):
Where do you rank on Northwest's?

Midwest is being absorbed by Northwest? Did I miss an announcement?

So tell me again how losing seniority, a downturn in quality of life, and possible displacement happening tomorrow with AirTran would be better than staying with the Midwest status quo, with only the possibility that a merger could happen with somebody else years down the road?

And Northwest is ALPA... so a stapler it would not be. Two ALPA groups merging have provisions that seek to protect quality of life, career expectations, etc. A 20 year YX MD-80 Captain wouldn't keep their full seniority and go fly 757s to Europe and Hawaii as it would hold at NW, but would remain in a similar position to what they have now. But, that's only a possibility of any sort of merger years down the road.... please explain why that is worse than that 20 year Captain being reset to Zero and going back on reserve effective immediately?
 
MKENut
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 8:35 pm

Quoting N822ME (Reply 39):
Midwest is being absorbed by Northwest? Did I miss an announcement?

YX will be merging with TPG not NWA. NWA is a minority investor and will not make decisions in the day to day operations of YX. TPG is calling the shots not NWA. I don't think the DoJ will approve the transaction otherwise.
 
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modernArt
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 11:39 pm

Quoting MKENut (Reply 38):
I know a few YX employees and they say morale is up since FL is no longer pursuing YX.

The arch enemy of Midwest, since day one, is likely to be calling the shots (if not already) in the not so distant future. Yep, its all rosey in Timmyville.

Quoting MKENut (Reply 40):
NWA is a minority investor and will not make decisions in the day to day operations of YX.

Do really believe that? The whole point of NWA getting their paws on this deal was to eventually sink their fangs into Midwest's juggler the most polite way they know how.
 
MKENut
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RE: Midwest Execs Get Huge Payouts

Fri Sep 28, 2007 11:54 pm

Quoting ModernArt (Reply 41):
Do really believe that? The whole point of NWA getting their paws on this deal was to eventually sink their fangs into Midwest's juggler the most polite way they know how.

I believe it until I see otherwise. TPG has a good track record with struggling airlines and this is not the first TPG deal that involved another airline as a minority investor. So I choose to look at the history of past TPG deals to determine how the Midwest deal will play out in the future. You don't really know, you just say what you feel in your gut right now and throw out "off the cuff" comments. You have nothing to base them on. I do! So back it up with facts and figures next time.
 
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knope2001
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RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 1:34 am

Also, I've yet to see anyone who thinks NW will take over Midwest suggest why Northwest was not interested in buying Midwest outright in the first place.


http://www.jsonline.com/story/index.aspx?id=661959

On July 31, Midwest Air announced that a board committee would meet with various unidentified parties interested in purchasing the company. At that time, AirTran was the only suitor that had been publicly identified.

Two days later, Steenland and other Northwest executives met with Hoeksema and his management team. The Northwest executives said their company was not interested in acquiring a controlling interest in Midwest Air, but it was interested in a minority equity investment, the filing says.

"The parties discussed the possibility of Northwest participating in an acquisition of our company in partnership with TPG Capital," the statement says.

TPG Capital and Northwest later agreed to form a partnership to pursue a purchase of Midwest Air, the filing says. On Aug. 10, Schifter and Steenland discussed with Midwest Air's board the TPG/Northwest offer, which was then $15.25 a share.
 
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JBo
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RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 2:20 am

Quoting Knope2001 (Reply 43):
Also, I've yet to see anyone who thinks NW will take over Midwest suggest why Northwest was not interested in buying Midwest outright in the first place.

They'll probably tell you something like "they may have said that, but we all know what they really want."

Sadly, some people believe in their own opinions so much more than what's printed in black and white that they almost carry it as fact.

I think Stephen Colbert calls that "truthiness" ... to describe things that a person claims to know intuitively or "from the gut" without regard to evidence, logic, intellectual examination, or actual facts.
I'd take the awe of understanding over the awe of ignorance any day.
 
MUWarriors
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RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 2:51 am

They would have gotten more short run from FL, but long run it will make more from this deal. For people like Carol, this may actually be worse, but for Tim it's likely better. Apparently the board thought it was better for the investors, and an in tact YX is better for employees and customers, in my opinion.

Quoting Knope2001 (Reply 43):
Also, I've yet to see anyone who thinks NW will take over Midwest suggest why Northwest was not interested in buying Midwest outright in the first place.

Exactly. A lot of people here seems to discount TPG's investment and place a priority on NW's, and I am not sure why that is. Why would TPG, who owns controlling interest, allow NW to dismantle their investment and in the end make the value of YX less than what it is now?
 
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knope2001
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RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 4:15 am

Quoting MUWarriors (Reply 45):
A lot of people here seems to discount TPG's investment and place a priority on NW's, and I am not sure why that is. Why would TPG, who owns controlling interest, allow NW to dismantle their investment and in the end make the value of YX less than what it is now?

Very true. TPG is not in the deal to do Northwest favors.

Is it a safe bet that NW will *never* purchase the other 53% of Midwest? Of course not.

But even if they do eventually purchase the rest of Midwest, there's nothing to say they would merge them in, either.

Northwest's key reason for this deal was to thwart AirTran's attempt to set up shop in the upper midwest. Say in 5 years TPG is ready to divest. If that divestiture five years from now opens Midwest up to purchase again by a rival like AirTran, NW might purchase the rest to continue to protect turf. But even if they do acquire full ownership of Midwest, that's a very different, far less involved prospect than doing a merger. Mergers come with all kinds of issues, headaches, and costs. And many mergers turn out to be less than the sum of their parts. Northwest benefits from relative status quo at MKE. If Northwest absorbs Midwest and essentially turns MKE into another Indianapolis focus city, they are inviting more competition (LCC and other) at MKE...the very thing they are trying to avoid.

So I think there are serious reasons why Northwest would want to *avoid* merging Midwest in. And the fact that they specifically stated they had no interest in acquiring Midwest outright fits this hypothesis cleanly.
 
B757capt
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RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 7:36 am

Quoting N822ME (Reply 34):

Would I care as much about job security when my seniority went to zero?

Would those YX ALPA pilots do as well when they are tacked to the bottom of the FL NPA seniority list? And many find their way back to reserve... in Atlanta?



Quoting Knope2001 (Reply 37):
I'm curious to know at what point a Midwest thread will NOT turn into sour grapes about AirTran's failed buyout attempt.

Anyone care to guess?

Unreal. You guys are still at it. Good luck while Northwest runs you into the ground. Little by little they will take what they need and screw the rest of you.

N822ME- Also just an FYI, please I'll give you a chance to change your statement, are you telling us that if there was a difference between you having no job or having zero seniority you would rather not have a job? Please tell all of us on airliners you are not retarded. Go talk to the folks at TWA if you prefer the later.
The views written by this user are in no manner the views of my employer and should not be thought as such.
 
MUWarriors
Posts: 196
Joined: Wed May 04, 2005 12:11 pm

RE: Midwest Execs Get Huge Payouts

Sat Sep 29, 2007 12:45 pm

Quoting B757capt (Reply 47):
Good luck while Northwest runs you into the ground.

It seems you are very sure of this. Care to explain why TPG will allow NW to run YX into the ground? TPG invested $239 million, and you seem to think they are willing to swallow that for NW. I just don't see that logic in the least. I think NW is in this because, like Knope, said another airline may try to buy YX at time of TPG's divesture but if no one else is interested NW will cash out, and allow an IPO. That is my guess on how things will work out, take it for what it is worth...
 
N822ME
Posts: 83
Joined: Mon Jul 02, 2007 3:31 am

RE: Midwest Execs Get Huge Payouts

Mon Oct 01, 2007 6:46 am

Quoting B757capt (Reply 47):
N822ME- Also just an FYI, please I'll give you a chance to change your statement, are you telling us that if there was a difference between you having no job or having zero seniority you would rather not have a job? Please tell all of us on airliners you are not retarded. Go talk to the folks at TWA if you prefer the later.

The choice isn't between zero seniority and no job. The choice, in this case, is between status quo and no seniority. I challenge you to show a credible source that indicates that the non-AirTran option means everybody is losing their job. Nobody on this board, nor anywhere else, has yet been able to produce anything but conjecture on that topic.

And funny that you bring up the folks at TWA. That was two separate unions merging, and TWA got stapled. Same situation as YX - FL: Two separate unions without common merger provisions. TWA folks lost their jobs with American furloughed. So if AirTran pulled back at MKE, would be the same people on the bottom to get furloughed.

You've not proven anything other than that it's your opinion TPG means no jobs for anybody... and you can't even explain why that is, why Northwest and TPG would purposely lose money on this, or why a merger even five years down the road with Northwest would mean stapled seniority (ALPA mergers don't allow that).

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