IBJNews

Southwest bid for Frontier could be in trouble

Back to TopCommentsE-mailPrintBookmark and Share

Southwest Airlines Co.'s bid for Denver-based Frontier Airlines Holdings Inc. may have hit turbulence, according to the Dallas Morning News.

Dallas-based Southwest is bidding against Indianapolis-based Republic Airways Holdings Inc. for the rights to acquire Frontier out of bankruptcy.

The newspaper reported late this morning that, in an e-mail purportedly sent from Southwest's pilot union to its members, the union failed to reach a deal last night with Frontier's pilot union over integration terms. Getting that deal is a condition of Southwest's bid.

The newspaper reported that the e-mail from the union says Southwest will ask for an extension on its $170 million bid for Frontier's assets. A bankruptcy court auction is in progress today.
 
 
 

Republic bid $108.75 million for Frontier and intends to let the carrier operate on its own. Southwest would absorb Frontier into its system over the course of two years.

The difference in the bids, however, isn't as wide as it would appear because Republic is a major secured and unsecured creditor of Frontier. A report on the thedeal.com today estimated the difference is actually less than $10 million when factoring in other considerations.

Earlier today, the Denver Post reported that Denver-based business interests are hoping Republic emerges as the winner. In fact, the Metro Denver Economic Development Corp. is encouraging Republic to buy Frontier and move its headquarters from Indianapolis to Denver, according to the newspaper.

Tom Clark, executive vice president of the business group, told the newspaper that his organization has been attempting to "go after all of Republic" because the company would probably maintain and create more jobs in Denver than Dallas-based Southwest.

Frontier has an aircraft-maintenance operation at Denver International Airport, and Clark expressed concern about the future of 200-plus jobs there if Southwest took over, the newspaper reported.

Officials from Republic could not be reached this morning to comment on the report.

Frontier filed for bankruptcy protection in April 2008 after its credit-card processor moved to hold back a big chunk of the proceeds from ticket sales, raising the prospect of a cash crunch. According to court documents, a consultant hired by the airline began contacting potential buyers in January, and some met with the airline's management over the next two months.

Some prospective investors backed out, however, because of lack of available credit and the downturn in the airline industry.


 
 
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. I am a Lyft driver who is a licensed CDL professional driver. ALL Lyft drivers take pride in providing quality service to the Indianapolis and surrounding areas, and we take the safety of our passengers and the public seriously.(passengers are required to put seat belts on when they get in our cars) We do go through background checks, driving records are checked as are the personal cars we drive, (these are OUR private cars we use) Unlike taxi cabs and their drivers Lyft (and yes Uber) provide passengers with a clean car inside and out, a friendly and courteous driver, and who is dressed appropriately and is groomed appropriately. I go so far as to offer mints, candy and/or small bottle of water to the my customers. It's a mutual respect between driver and passenger. With Best Regards

  2. to be the big fish in the little pond of IRL midwest racin' when yer up against Racin' Gardner

  3. In the first sentance "As a resident of one of these new Carmel Apartments the issue the local governments need to discuss are build quality & price." need a way to edit

  4. As a resident of one of these new Carmel Apartments the issue the local governments need to discuss is build quality & price. First none of these places is worth $1100 for a one bedroom. Downtown Carmel or Keystone at the Crossing in Indy. It doesn't matter. All require you to get in your car to get just about anywhere you need to go. I'm in one of the Carmel apartments now where after just 2.5 short years one of the kitchen cabinet doors is crooked and lawn and property maintenance seems to be lacking my old Indianapolis apartment which cost $300 less. This is one of the new star apartments. As they keep building throughout the area "deals" will start popping up creating shoppers. If your property is falling apart after year 3 what will it look like after year 5 or 10??? Why would one stay here if they could move to a new Broad Ripple in 2 to 3 years or another part of the Far Northside?? The complexes aren't going to let the "poor" move in without local permission so that's not that problem, but it the occupancy rate drops suddenly because the "Young" people moved back to Indy then look out.

  5. Why are you so concerned about Ace hardware? I don't understand why anyone goes there! Every time ive gone in the past, they don't have what I need and I end up going to the big box stores. I understand the service aspect and that they try to be helpful but if they are going to survive I think they might need to carry more specialty parts.

ADVERTISEMENT