Investment group concludes acquisition of Midwest Airlines

Midwest Air Partners, an acquisition vehicle created by the investment group TPG Capital, has concluded its purchase of Midwest Air Group, the parent of Midwest Airlines, for about $450 million. The acquisition brings a successful conclusion to Midwest’s long fight against a hostile takeover by AirTran Airways, which wanted Midwest’s Milwaukee base to build up its operations in the upper Midwest. The acquisition by TPG required federal approval, because Northwest Airlines put up almost half the funds for the deal – although both Northwest and Midwest insist that the larger airline is “a passive minority investor” in the new ownership structure, with no intention of influencing Midwest’s management. Still, Midwest executives said the airline’s 2008 business plan includes “growth and enhancement of its existing code-share agreement with Northwest,” along with other initiatives like “the implementation of seating choice throughout the airline’s mainline fleet,” and an environmental improvement program that includes replacement of its aging DC9s with new Boeing 717s. Meanwhile, just before the Midwest/TPG deal closed, spurned suitor AirTran announced that it plans to expand even more at Milwaukee on its own. Besides previously announced new service between Milwaukee and New York LaGuardia that begins May 6, AirTran said it will also initiate new seasonal service in May from Milwaukee to Los Angeles, Seattle, San Francisco, San Diego and Boston.