Mesa Air Group Proposes to Merge with Atlantic Coast Airlines; Aims to Renew Code-Sharing Agreements
PHOENIX, Oct 6, 2003 (BUSINESS WIRE) --
Mesa Air Group, Inc. (Nasdaq: MESA) today announced that it has made a proposal to the board of directors of Atlantic Coast Airlines Holdings, Inc. (Nasdaq: ACAI) to combine the two companies. The combination would create the leading operator in the regional airline industry, with nearly 300 aircraft and broad reach across major US markets.
The attached letter, expressing interest in a combination of the companies, has been sent from Mesa Chairman and Chief Executive Officer Jonathan Ornstein, to ACA's Chairman and Chief Executive, Kerry Skeen.
Under the terms of the all-stock offer, Mesa has offered 0.9 of a Mesa share for each share of ACA. Based on Mesa's stock price on October 3, 2003, the offer is valued at $11.30 per ACA share. That represents a 25% premium over its closing stock price Friday and a 35% premium over ACA's average trading price since July 28, 2003.
Mr. Ornstein commented: "ACA is a great company with an excellent operational track record, committed hard working employees and a proven history of financially successful code share partnerships. While the company has indicated that it intends to end its relationship with United Airlines and shift strategy, we continue to believe that a business model based on revenue guarantee code share relationships with major airlines serving hub networks offers the greatest long-term prospects for shareholders, customers and employees. By bringing these two companies together, and maintaining the successful revenue guarantee code share business model, we have the opportunity to create the leading regional airline in the United States."
Mesa Air Group will host a conference call on Tuesday, October 7th, at 11:00AM EST to discuss today's announcement. To participate in the call, analysts and investors may dial into the call at 800-575-5790, and international callers may dial into 719-457-0349. The passcode for both lines is 709373. A presentation to accompany Tuesday's conference call may be found at www.mesa-air.com prior to the call.