Regional News Update: SkyWest withdraws bid for ExpressJet

 - July 8, 2008, 9:57 AM

SkyWest last month withdrew its offer to buy Houston’s ExpressJet after concluding that a new seven-year capacity purchase agreement entered by ExpressJet and Continental Airlines rules out any deal. “Although we continue to believe our offer represented a favorable opportunity for ExpressJet stakeholders, the execution of a new ExpressJet capacity purchase agreement removes a fundamental component of our offer,” said SkyWest CFO Brad Rich.

Three days earlier ExpressJet had issued a statement saying it would continue to explore strategic and operational alternatives in response to SkyWest’s April offer of $3.50 per share, which ExpressJet rejected.

It subsequently signed the new Continental Express contract, which calls for significantly lower service rates for the regional partner.