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Regional airline operator ExpressJet Holdings Inc. rejected a $181 million buyout offer from rival SkyWest Inc. because the price apparently undervalued the company. However, SkyWest's offer may be as good as it gets, according to SEC Investor. - Maria Woehr
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From: Whitman,
Have you ever taken XJT? In chosing to cover and give my trade recommendations on this company, the good old Peter Lynch method was used. Service was good, convenient and the price was right. Editor
Posted on:
May 3, 2008 10:29 AM
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SEC Investor might be correct, but it is omitting an important part of the equation. Not only is ExpressJet’s future tied to Continental, as the post notes, but what they fail to mention is that SkyWest has negotiated an extension with in the event of a takeover, and Continental has told ExpressJet that is the only deal it is negotiating. In other words, the only way ExpressJet is guaranteed to keep its contract flying for Continental is to agree to a deal. And that gives them very little wiggle room.