Alaska Air

[USA320Pilot]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

Regards,

USA320Pilot

 

[TheLarkAscending]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

Regards,

USA320Pilot

[post="275157"][/post]​

Well, with your notable historical inaccuracy, i.e., track record --- that ought indicate to everyone here that it may be solid fact. 😉

Enjoy the weekend!

Lark

 

[FWAAA]

So at a minimum, you need to take $100 million out of your total to keep from counting it twice (in investments and US unrestricted cash). At worst, your total could be reduced by as much as $800 million plus.

[post="275152"][/post]​

Exactly why the announced investments to date are hardly "stunning."

The only part that is perhaps "stunning" is the relative small size of the new money.

The Airbus loan is really money with which to buy new airplanes, right? Hardly any new liquidity there. The regional airlines' money is just cash with which to pay more FPD commuter flights.

I'm still waiting to be stunned.

 

[delldude]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

Regards,

USA320Pilot

[post="275157"][/post]​

i was told doug mckeen is advising alaska air...we remember him don't we?
he was partly responsible for our pocketbook shakedown....
makes one wonder whats in the wind.....
cohen at nw.....hmmmm

 

[TBONEJ4J]

BoeingBoy:

Replacing about 200 Boeing jets takes time, but the fact is Boeings are being eliminated and Airbus jets are being added to the combined company.

[post="275100"][/post]​

Replacing the Boeing 737 will only take as long as Chautauqua/Republic, or whatever other contract lift provider, takes to ramp up E190/195s. :down:

The Boeing 737s are not so much being eliminated, as being outsourced and replaced with the new Jungle A319. Any proposed addition of Airbus aircraft to the combined fleet will not even come close to replacing the loss by outsourcing of the Boeing fleet.

I say again, it is astounding, considering the amount of aircraft that will be parked post merger and consequent loss of jobs, that no one is kicking up a stink about outsourcing the Boeing 737 fleet replacement. :blink:

 

[BoeingBoy]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

Regards,

USA320Pilot

[post="275157"][/post]​

Maybe those "informed" people read the regulatory filing....

Alaska Air says no plans to bid for America West

Jim

 

[funguy2]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

What... did you read the Business Week link posted? This was posted on June 2nd, well before your report. And in fact, as you were posting this, reuters was busy writing a short article, that Boeing Boy posted, siting an SEC filing made by Alaska stating they intend no such activity...

Your sources were right... But a day late and a dolloar short... literally.

 

[PropPiedmont]

I wonder what Branson is thinking about all of this?

 

[funguy2]

funguy,

On your list of liquidity:

$100 million of the $500 million in investment has already been received (the Air Wisconsin DIP loan), so it's not "new liquidity" since it's already in US's unrestricted cash.

The $513 million in US unrestricted cash is really not unrestricted - it's ATSB cash collateral.  Time will tell how much if any of that is truly unrestricted after emergence from BK (or even after June).  It could range from $0 cash collateral to the pre-BK $700 million plus.

So at a minimum, you need to take $100 million out of your total to keep from counting it twice (in investments and US unrestricted cash).  At worst, your total could be reduced by as much as $800 million plus.

Good catch Boeing Boy. So, that makes $1396mil liquidity. I guess, for the time being, I will count the US cash, as it is their only current working capital. Also, US Airways has a significant amount of restricted cash. I believe the ATSB covenants refer to unrestricted cash balances. I do not know how these items inter-relate. It seems to me to be reasonable to count US Airways unrestricted cash at this time.

Then, as I mentioned, there are the other items which can/will boost liquidity if and when they happen.
~ $110mil from Republic for MDA and slots
~ Potential rights offering mentioned (I think I heard HP management say up to $250mil in one of the conference calls)

(Adding in these two items, gets you to $1756mil... assuming they occur... not a given)

~ Expected cash generation (opposite of burn) during the summer (I've heard no official estimate)
~ Ability to "unrestrict" restricted cash (no idea, just throwing this out there, but it seems plausible that restricted cash requirements may decline post merger)

On the AS thing, my assumption was that AS would consummate the HP purchase after the proposed HP/US combination had occured, so that the stock swap would be for "new" HP shares.  But that was just my assumption and could definitely be wrong.

Like I had noted, that was my reading of the Business Week piece. I could have read it wrong as well... In any event, it is now a mute point (supposedly).

 

[Hope777]

http://www.thestreet.com/_yahoo/markets/ro...=FREE&cm_ite=NA

 

[BoeingBoy]

I guess, for the time being, I will count the US cash, as it is their only current working capital. Also, US Airways has a significant amount of restricted cash. I believe the ATSB covenants refer to unrestricted cash balances. I do not know how these items inter-relate. It seems to me to be reasonable to count US Airways unrestricted cash at this time.

[post="275208"][/post]​

That all sounds fair enough to me. The big place that I can see restricted cash freed up is possibly the larger than normal deposits with the credit card processor. I think most of the rest is for such run-of-the-mill things as payroll tax withholding, pfc's, ticket taxes, etc.

Jim

 

[delldude]

I am hearing from "informed" people outside of the company the Business Week report that Alaska may attempt to takeover the new US Airways (America West & US Airways) is not true.

Regards,

USA320Pilot

[post="275157"][/post]​

thats ok i just hear voices from time to time saying:
320 is right 320 is right 320 is right

 

[markkus757]

What could really screw this up is if AS would actually bid on US if they could not afford HP. Now that competing bids are allowed, maybe Boeing gets into the mix and "helps" AS buy out US. AS only benefits from that deal.

As the acquirer, they can staple the seniority lists. They can reap the benefits, of now having the east coast presence they currently want. US gets to funnel most of their potential west coast travel inconveniently through Seattle or Portland. How inconvenient for them.

As everyone talks about the new premium for HP stock, this becomes a more clear possibility as the rumors spin out of control.

 

[funguy2]

markkus757: Maybe a possibility, despite Alaska saying specifically that they are not interested in US Airways. It would seem to me that an ALK-US Airways merger would be much much more similar to the USAir-PSA deal, than the proposed America West deal.

Consider this:
US+HP:
~ HP has a decent transcon operation via PHX/LAS
~ PHX/LAS hubs offer ok connecting East-West (not as good as DEN, much better than SEA/PDX/LAX)
~ US and HP have common fleets (some HP 733's are ex-us)
~ HP and US share many more midwest markets (i.e. MSP, MKE, MCI, etc... where HP can take you west and US can take you east).

US+AS:
~ Transcon ops focused on SEA, which is a terrible connection point (worse geographically than PHX/LAS)
~ Almost completely different fleets (exception: 734's)
~ Lack of a midwest hub much bigger problem than US+HP (US+HP can offer decent service from MCI/MSP/MKE to the west via connections at PHX/LAS... US+AS would not have these routes initially, and would have to develop a midwest hub, point-to-point service, or find a way to funnel folks through SEA to make this work

In short... HP is the better fit for US. HP+US has a much better chance of surviving than AS+US. In fact, AS+US would be PSA all over again, IMO, where HP+US would not be (due to the developed hubs at LAS/PHX and their better geographical situation than SEA/PDX/LAX).

Don't get me wrong... Alaska is a good airline, and they are very good at what they do... And the Alaska monopoly would be valuable to whomever ends up acquiring AS (or acquired by) if that should ever happen.

 

[USA320Pilot]

Funguy2:

Earlier today I did some research, contacted some sources, and inquired about the validity of last nights Business Week Online report, which indicated Alaska may have interest in M&A activity. According to the Charlotte Observer, "Alaska is considering a move to buy America West and join that airline's planned merger with US Airways, Business Week reported Thursday on its Web site," the newspaper noted.

The move would not disrupt the merger and would leave Alaska Air as a big shareholder in the merged company, the magazine reported in a brief item in its "Inside Wall Street" column.

This afternoon I was informed that the rumor was untrue. I’m not sure where my contacts obtained their information, but I believe they contacted people at Alaska, but they certainly could have seen or been “tipped offâ€￾ by Alaska’s regulatory filing.

Then following my post announcing that the rumor was untrue, BoeingBoy did another good job of providing initial public reports disputing the rumor because Alaska said it had "no current plans to become involved in a transaction with America West or US Airways and have not spoken with the investor mentioned in the original news story reporting this rumor."

Regards,

USA320Pilot