Pinnacle Purchases Colgan Air

[mikecweb]

Thoughts from the two pilot groups?

[GaTechKid]

http://phx.corporate-ir.net/phoenix....lar&id=951595&

Pinnacle Airlines Corp. Announces Purchase of Colgan Air, Inc.
MEMPHIS, TN, Jan 18, 2007 (MARKET WIRE via COMTEX News Network) -- Pinnacle Airlines Corp. (NASDAQ: PNCL) today announced the purchase of Colgan Air, Inc., which maintains its headquarters in Manassas, Virginia. Pinnacle Airlines Corp. is the parent company of Pinnacle Airlines, Inc., a regional airline doing business as Northwest Airlink.
Pinnacle Airlines Corp. will pay $20 million for all of the issued and outstanding capital stock of Colgan Air, with $10 million in the form of an immediate cash payment and $10 million in the form of a one-year note secured by the stock of Colgan Air. The acquisition will be completed today subject to any applicable regulatory review.

Colgan Air is a premier turbo-prop regional airline operating as Continental Connection, United Express and US Airways Express. Launched in 1991 as a family-owned and operated company, today Colgan Air offers 354 daily flights to 53 cities in 13 states. Colgan is recognized for the exceptional service levels it provides its Customers and is a leader in providing air service to small and medium-sized cities in the United States. Colgan operates 39 Saab 340 and 11 Beech 1900 regional airliners, and has hub operations in Boston, Houston, New York, Pittsburgh and Washington, D.C. Colgan Air employs approximately 1,100 People and transported nearly 1.5 million Customers in 2006. Colgan has experienced strong revenue growth over the past years. In 2005 Colgan had revenues of approximately $137 million. Colgan projects that it will have revenues of approximately $190 million in 2006.

"This is a strategic move for our organization and offers Pinnacle Airlines Corp. extraordinary opportunities by diversifying and expanding into multiple platforms," said Philip H. Trenary, President & CEO of Pinnacle Airlines Corp. "Colgan Air has a highly productive workforce with knowledge, experience and fantastic dedication."

This purchase provides Pinnacle Airlines Corp. with two separate platforms for growth.

Mr. Trenary continued, "The purchase of Colgan Air gives our corporation access to and relationships with three of the largest carriers in the United States: Continental Airlines, United Airlines and US Airways. When combined with Pinnacle Airlines, Inc.'s airline services agreement with Northwest Airlines, Pinnacle Airlines Corp. now code-shares with a significant proportion of the major airlines in the United States. These new relationships will be invaluable to helping grow both Pinnacle Airlines, Inc. and Colgan Air."

Mr. Trenary also explained that the newly expanded corporate organization will be better able to diversify fixed costs across a wider base, creating more efficiency and lowering unit operating costs at both carriers. "We believe both airlines will be more competitive in the marketplace as a result of this purchase."

Pinnacle Airlines Corp. expects that the acquisition of Colgan Air will result in a slight increase to consolidated earnings per share for the year ended December 31, 2007, with a more significant positive impact in future years as both airlines benefit from the customer relationships and economies of scale that this acquisition brings.

Mike Colgan, President & CEO of Colgan Air, will remain in his current capacity as President and CEO of Colgan Air, Inc. for the immediate future. Mr. Colgan will be an instrumental liaison between Pinnacle Airlines Corp. and Colgan Air as they create a seamless transition for the current Colgan customers.

Mr. Colgan stated, "We are very proud of Colgan Air and see this as an exciting step forward. While this was not an easy decision for our family, we considered the strength of Pinnacle Airlines Corp. and its management team as an opportunity to continue the growth of the company in an ever-evolving industry. The employees of Colgan Air are more than just employees here -- they are family. Collectively, the entire Colgan Air Family, along with our customers, has made this possible. The management team of Pinnacle Airlines Corp. has been long-time friends and industry colleagues; I join them in welcoming everyone to this new and exciting venture."

Phil Trenary added, "Colgan Air is a family-centric organization with a positive attitude and an excellent team of service focused professionals. This makes Colgan an excellent cultural fit with our company and our People. Additionally, we are pleased that several members of the Colgan family will continue to work with us through the transition and into the future."

Pinnacle Airlines, Inc. and Colgan Air will operate as two separate entities with independent and separate management structures. Pinnacle Airlines Corp. and Pinnacle Airlines, Inc. will remain at the current headquarters in Memphis, TN. Colgan Air will maintain its operational headquarters in Manassas, VA, provided it continues to make operational and financial sense for the organization.

Pinnacle Airlines Corp., an airline holding company, is the parent company of Pinnacle Airlines, Inc. and Colgan Air, Inc. Pinnacle Airlines, Inc. operates under the name Northwest Airlink and operates 127 Canadair Regional Jets in the United States and Canada. Colgan Air, Inc. operates as Continental Connection, United Express and US Airways Express. Colgan Air operates a fleet of 39 Saab 340 and 11 Beech 1900 turbo-prop regional airliners.

Do da Pinnacle?

[kellwolf]

I heard this rumor a week ago and laughed my ass off. Then I got a PM from a Colganite last night asking WTF was up. Now I know. Unfortunately, I'm getting set to get whipsawed by my company now. My bet is 9E management will try to whipsaw us against the Colgan folks. Currently, our scope says any flying done by Pinnacle Airlines, Inc has to be done by Pinnacle airlines pilots on the seniority list. Pinnacle Airlines CORP is who bought Colgan. Here comes the GoJet/Freedom/Big Sky again......

[Seggy]

Excuse me while I finish picking up my jaw off the ground.

[kellwolf]

On the 9E side, we have no clue what's going on. We're expecting the worst in the form of whipsawing at this point....

No word on if they're gonna be kept two separate, merge the seniority list or whatever. Management hasn't even been interested in the negotiating table on the current contract in about 3 months. First it was the ASA with NWA, and now this. I'd heard the rumor last week and thought it was funny as hell. Now, it's not so funny. I never thought the Colgan family would sell the airline.

[desertdog71]

Crusty Clown Voice....Arrrrggghhhhhhh oiiiii.

[SmitteyB]

Chuck Colgan? Why? Securing your financial future?

[kellwolf]

Argh. Just went back and checked the new ASA with NWA. It's between NWA and Pinnacle Airline CORP. We all know what that means......

[dvtpilot]

Well.....####.....

[ComplexHiAv8r]

Seggy, you might get to move up to the -900 yet

This won't be good for rates or how you move up in the company.

[SmitteyB]

I'm sure there will be some ship jumpers.

[kellwolf]

Originally Posted by ComplexHiAv8r

Seggy, you might get to move up to the -900 yet

This won't be good for rates or how you move up in the company.

Right now, they're gonna keep the two separate, which means I should stay off reserve and Seggy's still on track to upgrade soon. The thing I'm most worried about is 9E's management suddenly coming to the table with "You'll take this deal, or Colgan's getting your planes."

[Kristie]

I have to admit.. that is kinda surprising!!

[Seggy]

Originally Posted by Kristie

I have to admit.. that is kinda surprising!!

Trust me that is an understatement!

[BobDDuck]

Wow... there was one I didn't see coming.

Let's hope that they keep you seperate. Whipsaw is never a good thing.

[SmitteyB]

Your point JEP?

[SmitteyB]

I thought you were challenging what Kellwolf said by using the highlighted information. Sorry.

[JEP]

Moderator powers activate.....


form of:

merging the two near identical threads....

[casey]

Originally Posted by JEP

Excuse me, did you say something.....



There is no point. It was the news article from the PCL website. The price was highlighted so it stood out from the rest of the article.

it was also in the original post

[dingo222]

i see the whipsaw coming for pcl pilots. that sucks, you guys are way overdue. I see colgan pilots getting casted as scabs later on for taking planes or flying from pcl since we are non union. whats the number to truck masters again?

[kellwolf]

Yeah, I'm not following either. Don't see anything about merging seniority lists. Keep in mind the holding company is the one that bought Colgan. I'm referring to keeping Pinnacle Airlines, Inc and Colgan seperate.

Although, I did read lower that they are going to keep the two separate. But, as stated earlier, that's the best way to whipsaw the two against each other. Merger the lists, and they lose that.

[kellwolf]

Originally Posted by dingo222

i see the whipsaw coming for pcl pilots. that sucks, you guys are way overdue. I see colgan pilots getting casted as scabs later on for taking planes or flying from pcl since we are non union. whats the number to truck masters again?

Sadly, there's truth to that. I've already talked to Seggy today, and we're both beside ourselves. We don't wanna get whipsawed in the middle of negotiations and they don't wanna get painted as the bad guys. Truthfully, MANAGEMENT is the bad guy if that happens, not the pilots. I don't see the Colgan guys taking a pay cut. It's already low enough over there. I see management using that fact to keep us from getting the pay raises we need and deserve over here.

[SteveC]

.

[SmitteyB]

Originally Posted by kellwolf

Sadly, there's truth to that. I've already talked to Seggy today, and we're both beside ourselves. We don't wanna get whipsawed in the middle of negotiations and they don't wanna get painted as the bad guys. Truthfully, MANAGEMENT is the bad guy if that happens, not the pilots. I don't see the Colgan guys taking a pay cut. It's already low enough over there. I see management using that fact to keep us from getting the pay raises we need and deserve over here.

Colgan would dissolve if a paycut were ordered.

[aussieflyer]

OMG I just lost $50 on this Rumot. Someone mentioned it to me the other day and I said no way not gonna happen.

Gees!

Best of luck guys and remember that at the end of the day we are all on the same team. It's management that sucks.