Mesa Wins Midway Assets
Mesa Air Group last month won the rights to the assets of bankrupt Midway Airlines after outbidding Connecticut-based investment firm Wexford Capital by some $550,000. Mesa’s $9.15 million bid for the defunct airline bought it Midway’s operating certificate, six leased 50-seat Bombardier CRJs and the rights to three more leased CRJs and a pair of owned jets, all of Midway’s CRJ spare parts and support equipment, all landing and takeoff slots at New York La Guardia and Washington National Airports and all “acquisition materials” associated with the operation of Midway’s CRJs. It also agreed to assume some $90 million in debt associated with the fleet. Federal bankruptcy judge Thomas Small approved the bid after denying a motion by Midway’s pilots to hold Mesa to a successorship clause negotiated between ALPA and the previous management.
Mesa’s last-minute overture for Midway foiled Wexford’s plans to use the bankrupt carrier’s jets to start a new US Airways Express affiliate called Ascent Airlines. Mesa, whose chairman and CEO, Jonathan Ornstein, has publicly acknowledged difficulties in financing new aircraft acquisitions, would likewise use the jets to expand its relationship with US Airways or perhaps help satisfy suddenly daunting equipment needs associated with new code-share deals with United Airlines.