AirTran Extends Deadline; Kohl Criticizes Takeover Bid
By Jenn Rourke
MILWAUKEE, Wis. (AP) -- AirTran Holdings, Inc. extended its offer to buy Midwest Airlines' parent company by more than one month Wednesday, while Sen. Herb Kohl got a Justice Department lawyer to agree to review any new information on anti-trust ramifications of the bid.
Orlando, Fla.-based AirTran, the parent of low-fare air carrier AirTran Airways, said it pushed back the deadline from Thursday until April 11.
AirTran said it wanted to make sure shareholders of Milwaukee-based Midwest Air Group, Inc., would have all the information they need to make an informed decision.
The move marks the second time the deadline -- originally set for Feb. 8 -- has been extended.
The $345 million buyout deal offers Midwest shareholders $13.25 a share in cash and stock.
AirTran said 1.78 million shares so far have been tendered, or just under 10 percent of Midwest's outstanding shares.
Midwest's board has urged shareholders to reject the deal, calling it inadequate.
The company, known for its wide leather seats and other amenities, also rejected a smaller offer in December.
AirTran is trying to convince Midwest shareholders the deal is in their interests, arguing the combined company would be more efficient.
Kohl, a Milwaukee Democrat who uses Midwest when flying to and from the nation's capital, praised the airline and criticized the takeover bid at a hearing in Washington by the Senate antitrust, competition policy and consumer rights subcommittee, As chairman, he had called the hearing.
Thomas O. Barnett, a Justice Department anti-trust lawyer, said an initial review of the proposed takeover has been done, but he agreed to Kohl's request to review any information regarding anti-trust concerns raised by the senator, his staff and constituents.
While the initial review had been closed, the department was "not precluded from looking at it further based on additional information," Barnett said.
Kohl said AirTran has a history of promising high levels of service as it enters markets, only to break the pledges and cut service later.
When shown Kohl's prepared remarks, AirTran vice president of planning Kevin Healy disputed those comments and said the Justice Department already "rightfully concluded that this deal presents no problem."
But Sen. Russ Feingold, D-Wis., who attended part of the hearing, said he was concerned the first review was concluded too quickly.
AirTran shares dropped 5 cents to close at $9.95 on the New York Stock Exchange. Midwest shares dropped 10 cents to close at $11.35 on the American Stock Exchange.
(Copyright 2007 by The Associated Press. All Rights Reserved.)
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