? for the execs who visit here

[usair_begins_with_u]

Currently, as of 3/17/08, LCC market cap is $720 Million. Also currently, LCC has ~ 2.0 Billion in cash on hand. Can some one please explain why the BOD does not move to put a tender offer out to buy the company outright and take it private?? I'd have to imagine the liquidation value of LCC right now exceeds its Market Cap, which begs for take over. If I was CEO and my and firm was trading 3 times below my cash available per share, I'd be looking for a new job, or doing my best to take the firm private.

 

[NYGiantsFan90]

Because they cant use the corporate funds, they would have to raise the money elsewhere.

 

[YVINTERN]

Why can't we do what United did? Buy the company out through the employees and screw the management over and turn this operation around? I'd be in favor of this.

 

[BoeingBoy]

I'd have to imagine the liquidation value of LCC right now exceeds its Market Cap, which begs for take over.

Besides NYGiantsFan90's answer, what you're really saying is that the sum of the parts (the "liquidation value") is greater than the market cap. What you forget is that the sum of the parts includes much more than cash - it also includes those little nuisances called liabilities which would also be the property of whoever might be interested in taking the company private. Start with just the biggest single one - the $1.6 billion that the former ATSB-backed loans have evolved into.

The mere fact that every legacy carrier's cash is well in excess of market cap, yet there isn't a line of Gordon Gekko types lined up to take them private, is trying to tell you something.....

Jim

 

[INSP17]

Not to mention the fact that that was done at United and I think Northwest the employee's doled out large amounts of cash took cutsin pay and benifits and still got hosed in the end of it all

 

[YVINTERN]

Not to mention the fact that that was done at United and I think Northwest the employee's doled out large amounts of cash took cutsin pay and benifits and still got hosed in the end of it all

Yes but United and Northwest remained a publicly traded company...if we did this I would hope for our airline to remain privatized. Hence reducing the risks of getting screwed over.

 

[NYGiantsFan90]

At UA, the employees lost it all when they filed chapter 11 and got screwed, all their stock was cancelled and they got pennies for it.

At NW the employees at least got some good cash back on their stock once they sold it.

ESOPs are a failure in the Airline Industry.

 

[sharktooth]

Not to mention the fact that that was done at United and I think Northwest the employee's doled out large amounts of cash took cutsin pay and benifits and still got hosed in the end of it all

The UAL pilots forgot that when they own the company, they end up negotiating with themselves. Just ask any schizophrenic how that goes.

If you want employee ownership, fine. Just make certain everyone understands the inevitable consequences to such an action.