Though AirTran long ago abandoned its hostile takeover bid for Midwest Air Group, the discounter offered a fresh reminder Tuesday that the battle for Milwaukee still rages on when it announced a significant increase in service at Midwest's hometown airport.
Orlando-based AirTran has had its focus on Milwaukee since December 2005, when it first approached Midwest about a merger. Those overtures were made public in a hostile bid a year later, with AirTran eventually offering $445 million for the small carrier.
Midwest thwarted AirTran's efforts by striking a deal to sell to TPG Capital in August 2007. But the airline has faced turbulence since, and last September announced it would shed much of its fleet, cut routes and contract with investor Republic Airways Holdings Inc. to fly under the Midwest name. The company also faces a disgruntled workforce due to the Republic deal and Midwest's attempts to lower pay scales.
AirTran is flying into the void Midwest is creating, announcing Tuesday
it would expand its flights in Milwaukee by 40% including new service to Denver, Minneapolis, St. Louis and Branson, Mo. The airline is also making previously-seasonal service to Los Angeles, Tampa and Boston year round in a bid to attract more lucrative business travelers instead of just vacationers.
Midwest flies from Milwaukee to Minneapolis, Denver, Tampa and Boston, and offers one-stop service to Los Angeles. While AirTran is not saying it is targeting Midwest directly, the new competition seems sure to lower fares (AirTran boasts it expects to see fares drop as much as 60% on the new routes) and could squeeze Midwest at a time when the smaller airline is scrambling to reinvent itself.
AirTran might have lost the bidding war for Midwest in 2007. But as Yogi Berra said, "It ain't over till it's over." For AirTran, the battle for Milwaukee rages on. --
Lou Whiteman
Join Corporate Dealmaker's LinkedIn forum
Juergen Lasowski
And the winners are...
