AirTran Airways, which has been pushing a hostile takeover of Midwest Airlines, has extended its offer until June 8. AirTran announced the takeover bid back in December, and is seeking to buy Midwest for $389 million in cash and stock. Midwest has staunchly refused to give in; a company spokeswoman said that "It doesn't change anything. The board continues to remain steadfast in its view that the offer is inadequate." The board last month unanimously rejected a $15 per share offer.
But that might not be enough. AirTran announced that Midwest shareholders have tendered almost 14 million shares of Midwest to an AirTran company. That's more than the 56.6% of Midwest's outstanding shares. And even though the company spokeswoman said that the board is still rejecting the idea of a takeover, AirTran now has enough shares to nominate three members to Midwest's board, which has nine members.
Midwest has been seeking to 'go it alone' and has its own plan for independent growth, which involves new routes and more airplanes. It has even launched a website, Savethecookie.com, which plays off of the airline's reputation for serving freshly-baked cookies in flight. Of course, the companies are vastly different in terms of company culture (and, some would argue, in terms of service levels). If the airlines were to merge, I don't think it would be the smoothest of mergers. We'll see if Midwest is successful at convincing the public to stay independent, and if AirTran is successful at convincing the shareholders to go ahead with the takeover.