Will Delta-Northwest Merger Affect Midwest?
MILWAUKEE - Could the merger of Northwest and Delta affect Milwaukee’s hometown airline?
The deal could mean changes for Midwest Airlines.
Northwest Airlines owns nearly half of Midwest. Now that Northwest and Delta have announced a merger, that raises a big question: what happens to their share of Midwest, and what does it mean for us?
People talk about how much they like having Midwest Airlines in Milwaukee, and they don't want to hear about changes.
“I like Midwest the way it is,” Ben Eberly said.
Midwest fended off a takeover by AirTran last year. Now, Milwaukee’s hometown airline faces another possible change to who owns the company, or at least, almost half of it.
“I dislike it because Midwest is our favorite airline,” Richard Mangan said.
Northwest owns almost half of Midwest now. Now that Northwest is merging with Delta, it's unclear what will happen to that stake in Midwest.
A Midwest Airlines spokesperson said nothing will change, and a Morningstar Financial analyst who predicts a combined Delta-Northwest company will actually want to keep their big stake in Midwest.
“I don't think that selling that stake is likely, right now, because these carriers still have a lot of cash,” analyst Brian Nelson said.
Nelson believes the combined Delta-Northwest airline will still have a lot to gain by holding on to their ownership of Midwest, as long as federal regulators allow the Delta-Northwest merger to go through in the first place.
“It remains to be seen whether regulators are going to pull strings in that regard,” Nelson said.
The other thing our analyst pointed out: Northwest paid top-dollar for Midwest, and it's going to be tough for them to sell right now and get their money back out of it.