Delta Air Lines To Sell Off Mesaba And Compass Airline Subsidiaries

 

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Delta Air Lines To Sell Off Mesaba And Compass Airline Subsidiaries

By
Shane Nolan
 
 

July 5, 2010 - Delta Air Lines announced it has entered into definitive agreements to sell two of its wholly owned regional airline subsidiaries, Mesaba and Compass Airlines. Mesaba has been sold to Memphis, Tenn.-based Pinnacle Airlines for 62.0 million, and Compass has been sold to St. Louis-based Trans States Holdings for $20.5 million. Pinnacle and Trans States are both large and experienced regional airline operators, with Pinnacle currently serving as one of Delta's largest regional carriers.

Under the terms of the agreements, Mesaba and Compass will continue to serve Delta customers with long-term, extendable agreements, ranging from seven to 12 years depending on aircraft type.

Both Mesaba and Compass will continue to be headquartered in Minneapolis-St. Paul with current presidents John Spanjers and Tim Campbell, respectively, leading the airlines under new ownership. The proceeds from these transactions will be used by Delta for general corporate purposes.

 

Delta Connection Senior Vice President Don Bornhorst said, "Today's announcement reflects our continued focus on streamlining the portfolio of Delta Connection carriers serving our customers to ensure each partner airline is independently positioned for success with a competitive cost structure and an industry-leading focus on safety, reliability and customer service.

In conjunction with the sale of both carriers, Delta will enter into new Delta Connection agreements under which Mesaba and Compass Airlines will continue to serve as Delta Connection carriers. Current plans are for Mesaba and Compass Airlines to operate as wholly owned subsidiaries of Pinnacle Airlines Corp, Inc. and Trans States Holdings, Inc., respectively. The transactions are not expected to result in any changes in flight schedules or locations served. Compass and Mesaba's combined fleet of nearly 130 aircraft will continue to be dedicated to flying Delta routes.

 

Pinnacle Airlines Corp., an airline holding company, is the parent company of Pinnacle Airlines, Inc. and Colgan Air, Inc. Pinnacle Airlines, Inc. operates a fleet of 142 regional jets under the Delta Connection brand. Colgan Air, Inc. operates a fleet of 48 regional turboprops as Continental Connection, United Express and US Airways Express.

Trans States Holdings, Inc. is the parent company of two regional airlines - Trans States Airlines and GoJet Airlines. Together, Trans States Holdings' regional airlines' 1,400 employees serve nearly five million passengers annually to 69 cities on 330 daily flights. Trans States currently operates flights as United Express and US Airways Express.

Mesaba is based in Minneapolis-St. Paul, Mesaba is a member of the Delta Connection program, operating more than 430 flights each day to 95 airports. The airline operates a fleet of 96 aircraft and employs nearly 2,000 aviation professionals across its route system. Founded in 1944, Mesaba has operated as a Northwest Airlink and Delta Connection carrier since 1984.

Compass is a member of the Delta Connection program, operating more than 170 flights each day to 35 airports. Based in Minneapolis-St. Paul, the airline operates a fleet of 36 aircraft and employs nearly 1,000 aviation professionals across its route system.

 

 
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