Midwest Air to consider alternatives, including AirTran's offer

By Lisa Kerner

Charlotte, N.C., July 31 - Midwest Air Group, Inc.'s board of directors formed a committee to "explore strategic and financial alternatives that would serve to enhance value for the company's shareholders," the company announced on Tuesday.

The board plans to begin discussions with AirTran Holdings, Inc. regarding its proposal to acquire the company and also with other interested parties that have expressed interest in Midwest.

"We are pleased that Midwest has taken the step to form a special committee, and we look forward to working with the committee," AirTran chairman and chief executive officer Joe Leonard said in a company news release.

Midwest said there is no assurance that the process will result in a transaction with AirTran or any other party.

The committee is headed by chairman Samuel K. Skinner, former Secretary of the U.S. Department of Transportation. Other committee members include Jeffrey H. Erickson, a newly elected board member and former president and chief executive officer of Trans World Airlines and Atlas Air Worldwide Holdings; Ulice Payne, member of the board's audit and compensation committees; Elizabeth T. Solberg, chair of the board's compensation committee; and Richard H. Sonnentag, board member and chair of the board's audit committee.

"By providing AirTran and other interested parties with access to our confidential information and holding discussions with them, the board is pursuing a process to evaluate whether greater value can be delivered to shareholders through a near-term transaction," Skinner said in a MidWest news release.

As previously reported, AirTran extended its $15-per-share tender offer for Midwest to Aug. 10 from June 8. The offer was originally slated to close on May 16. As of June 8, shareholders agreed to tender more than 14.6 million shares, of 59.5%, of Midwest to Galena Acquisition Corp., AirTran's wholly owned subsidiary.

In June, Midwest shareholders elected three directors nominated by AirTran to Midwest's nine-member board of directors.

Midwest is a Milwaukee-based provider of jet service to primarily business travelers. AirTran is the parent company of AirTran Airways, a low-fare airline based in Orlando, Fla.

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