British Airways signed a new three-year agreement with Galileo, the GDS unit of Travelport. It is the first GDS agreement announced by the carrier since its previous pacts expired at the end of February. The new deal, which goes into effect April 10, is basically a "continuation" of Galileo's travel agency opt-in program that was launched in 2004, according to the carrier.
US Bankruptcy Court judge approved Northwest Airlines' deal to acquire regional partner Mesaba Airlines under a stock purchase and reorganization plan ( ATWOnline, Jan. 24). The deal still must be approved by a judge overseeing the Mesaba bankruptcy.
KLM appointed Marc Lammens VP-commercial strategies effective April 1. Welmer Blom succeeds Lammens as director-sales and services at KLM The Netherlands.
US Airways said it entered into a commitment letter with Citigroup Global Markets and Morgan Stanley Senior Funding to arrange debt financing of up to $1.6 billion that would permit the airline to refinance $1.26 billion of its existing senior secured credit facility, refinance $325 million of unsecured debt and raise incremental liquidity. The transaction should be completed by the end of the current quarter, US said.
Indonesian government announced a ban on commercial aircraft older than 10 years this week following several mishaps and accidents, the worst of which was the January crash of a 17-year-old Adam Air 737-400 that killed 102 ( ATWOnline, Jan. 26). According to the Associated Press, Transport Minister Hatta Rajasa insisted the regulation would not require parliamentary approval but did not indicate when it would go into effect. The current age limit is 20 years.
US Dept. of Transportation will launch an investigation into recent incidents in which JetBlue Airways and American Airlines left passengers stranded onboard aircraft for hours during adverse weather conditions, joining several members of Congress and citizen groups in an effort to find solutions ( ATWOnline, Feb. 21).
Aeroports de Paris sold its interest in Beijing Capital International Airport Co. for HK$1.97 billion ($252.1 million) through an accelerated placement with institutional investors. ADP held 16.2% of BCIA's Hong Kong-listed shares. The French airport operator did not disclose its reason for offloading its stake but said it "reaffirms its willingness to accompany the Chinese authorities in their development of airports in China, in particular at the regional level."
Midwest Airlines said in a letter to shareholders yesterday that "AirTran's business is deteriorating" and that it wants to acquire Midwest to prevent further erosion. "AirTran leaves a trail of broken promises in markets it enters with great fanfare," said the letter signed by Midwest Chairman and CEO Tim Hoeksema.
MTU Aero Engines and JetBlue signed an agreement to extend the terms of a contract concluded in 2005 ( ATWOnline, June 29, 2005) from 10 to 15 years, bringing the deal's overall value to €2.4 billion ($3.16 billion). The original contract provided for nearly all 400 of the LCC's V2500s to visit MTU's shop at Langenhagen for maintenance. Under the extension, 116 IAE engines scheduled to be delivered to the airline from 2009 will be built to the upgraded SelectOne standard.
Grupo Ferrovial announced that Macquarie Airports exercised its call option on Ferrovial's 20.9% stake in the company owning the rights to Sydney Airport ( ATWOnline, March 30, 2006) for the agreed price of A$1.01 billion ($799.2 million). Ferrovial Aeropuertos will net A$919 million on the sale. The Spanish company said the share transfer will take place March 16-20.
Air Tran Airways said a merger with Midwest Airlines would create 1,100 new jobs in Milwaukee and add 74 flights out of Mitchell International Airport. In a filing with the US SEC this week, AirTran offered details that painted a positive economic outlook if it acquires Midwest, estimating that the total economic benefit to Wisconsin would be nearly $1 billion annually ( ATWOnline, Feb. 2).
OnAir, the Airbus-SITA joint venture, named former Airbus Senior VP-Finance Benoit Debains as its new CEO effective March 1, replacing George Cooper. It also named SITA VP David Russell as OnAir COO.
Malev Hungarian Airlines sale to AirBridge, a consortium led by KrasAir CEO Boris Abramovich, concluded Friday ( ATWOnline, Feb. 9). The purchase price was a little more than $1 million, according to press reports. The consortium, which also includes two Hungarian investors, committed to capital investment of $66 million and the repayment of $68 million in debt by year end, according to UPI, while the BBC reported that Abramovich said Malev will return to profitability within two years.
Jordanian government plans to retain a 26% stake in Royal Jordanian when it proceeds with the carrier's privatization later this year but may eventually sell, RJ President and CEO Samer Majali said. "I'm not sure that the Jordanian government intends to remain a shareholder over the long term," he said last week at ATW's Winning Airline Strategies conference in Washington, where he accepted the magazine's Phoenix Award.
Japan Airlines on March 25 will redeem ¥79.7 billion of convertible bonds due to mature in 2011, the company said in a stock exchange filing cited by Bloomberg News, which said investors had until Feb. 23 to convert the ¥100 billion of bonds into stock but that shares in JAL closed 32% lower than the bonds' conversion price. JAL said it is seeking a ¥60 billion credit line to help repay the bonds, according to Bloomberg.
News from Travel Technology Update: The European Commission asked for public comment on whether the Code of Conduct for Computerized Reservation Systems, first established in 1989, should be revised or abolished. The EC noted that since the last change to the Code of Conduct, most airlines have divested their holdings in GDSs. Of the four major GDS companies, only Amadeus still has some airline ownership: Air France/KLM owns 23.2%, and Lufthansa and Iberia each own 11.6%.
Open skies talks between the US and EU are set to resume today in Brussels with experts warning that the lack of an accord--or at least an initial agreement--could postpone a potential transatlantic air pact indefinitely and create increased tension for US-EU flight operations. "The US cannot surrender its role of leadership in the international aviation community," attorney Allan Mendelsohn, former assistant secretary for transportation affairs at the US State Dept., said last week in Washington at ATW's Winning Airline Strategies conference.
Air Transport Assn. board of directors, apparently hoping to forestall a push by consumer groups and politicians for so-called "passenger bill of rights" legislation, took the initiative at a meeting last week in Washington and said it is working to develop procedures for handling delays caused by extreme weather.
Qatar Airways installed an instant loyalty program enrollment kiosk in its business class lounge at Doha. The kiosk dispenses membership cards "within seconds" of the new member's registration.
Brian Rowe, a giant in the history of jet engines and a man closely associated with the rise of General Electric into the leadership position it currently enjoys in the jet engine business, died Feb. 22 following surgery. He was 75. Rowe led GE-Aviation from 1979 to 1993, serving as the division's president and CEO as well as a corporate senior VP.
German Chancellor Angela Merkel and French President Jacques Chirac jointly backed Airbus's Power8 restructuring plan Friday as a revised proposal put forward by EADS co-CEO and Airbus CEO Louis Gallois appeared to ease German opposition to the cost-cutting program, details of which could be revealed as soon as this week and likely no later than next week.
European Commission extended until June 13 its deadline to rule on Ryanair's €1.48 billion ($1.94 billion) hostile bid for Aer Lingus, both the EC and Ryanair confirmed yesterday, although neither offered a reason for the 20-day extension. The regulator set an initial deadline of May 11 to investigate worries that the acquisition would raise "serious competition concerns," ( ATWOnline, Dec. 22, 2006).
Airlines looking to make operational or marketing decisions based upon feedback from customers may be wasting their time, Aerobrand President David Hedley-Noble said yesterday during a forum dubbed "Winning Passenger Strategies" at ATW's Winning Airline Strategies conference in Washington. Aerobrand counts MAXjet Airways, Spirit Airlines, TACA, KLM, Lufthansa and Embraer among its clients.
