Dealmakers in the hospitality business would be wise to take note of a letter sent Monday by four senators to AirTran Holdings Inc. CEO Joe Leonard opposing that airline's $345 million hostile bid for rival Midwest Air. The senators, led by Midwest home-state representative Sen. Herb Kohl (D.-Wis.), do not object to the potential deal due to antitrust concerns. Indeed, the Department of Justice closed its review of a potential combination of the two airlines, who have very little overlapping operations, after only 30 days. Rather, the senators fear in part that the "award-winning level of service" Midwest offers "would be cast in serious doubt" should a deal occur.
Service is a big deal for Midwest, an airline that boasts fresh-baked cookies on each flight and planes with business-class-only seating. But using at-risk cookies as a standard to try to block a deal that Justice says is not anticompetitive would seemingly set a rather high service standard for future combinations. One can only wonder what the reaction might be should a hotel chain that offers a Senator's preferred pillow mint comes under attack by a hostile suitor.—Lou Whiteman
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