Institutional Shareholder Services and Glass Lewis & Co. Recommend Midwest Shareholders Do Not Vote for Midwest Directors and Vote for AirTran Nominees


04 Jun 2007 [11:43h]     Bookmark and Share



„We are pleased that ISS and Glass Lewis, two truly independent corporate governance experts, have recommended that Midwest shareholders change the dynamics inside the Midwest boardroom by electing AirTran’s nominees as Midwest directors,“ said Joe Leonard, AirTran’s chairman and chief executive officer.

ORLANDO – AirTran Airways, Inc., a subsidiary of AirTran Holdings, Inc., (NYSE: AAI), today announced that Institutional Shareholder Services (ISS), one of the leading independent proxy advisory services, recommends that Midwest Air Group, Inc. (Amex: MEH) shareholders do not vote to reelect any of Midwest’s three directors and instead use AirTran’s BLUE card to vote to elect AirTran’s three nominees — John Albertine, Jeffrey Erickson, and Charles Kalmbach — to the Midwest Board of Directors at the annual meeting of shareholders to be held on June 14, 2007. Glass Lewis & Co., another advisory service, also recommended not electing any of Midwest’s three directors and instead electing two of AirTran’s nominees.

Joe Leonhard: „These two advisory services separately issued strong rebukes against the Midwest board, their poor corporate governance record and their failure to fairly evaluate the AirTran merger offer. Their recommendations, combined with the fact that nearly 57 percent of Midwest’s outstanding shares were tendered to AirTran pursuant to our tender offer should deliver a strong message to Midwest that it is time to sit down with us and negotiate a merger that will be beneficial to all of the Midwest stakeholders.“

    In its report, ISS stated:

    -- "We believe that the board should engage in negotiations with AirTran
       regarding its offer."
    -- "An enticing premium and high percentage of tendered shares sends a
       strong signal that the company should enter into a good faith
       discussion with AirTran to explore the possibility of a combination."
    -- "We believe that the inclusion of three dissident nominees on Midwest's
       board may help a more objective evaluation of the company's strategic
       alternatives."
    -- " ... it is arguable as to whether [Midwest] can continue as a stand
       alone entity, given that with the entry of low cost carriers and
       reemergence of network airlines the competitive pressures would
       increase going forward."

    In its report, Glass Lewis stated:

    -- "We believe the Midwest board of directors has failed to undertake
       actions that could prove beneficial to shareholders ... it is clear
       that a significant number of shareholders believe the offer is
       financially favorable."
    -- "We find it concerning that the board continues to ignore shareholder
       sentiment. Furthermore, considering that management recently lowered
       its full year earnings estimates, we believe that shareholders should
       be concerned that the board has not explored more strategic options,
       including, discussions with AirTran."

Leonard continued, „By recommending that Midwest shareholders use the BLUE card to vote for the AirTran nominees, ISS and Glass Lewis join the majority of Midwest shareholders in voicing that they want Midwest to seriously consider the merits of a combination with AirTran and see how such a transaction will provide greater value for the Midwest shareholders, employees and customers. A combined AirTran-Midwest will be a stronger, truly national airline better positioned to compete in the increasingly competitive airline industry and generate value for shareholders, employees and Midwest’s communities.

„We are confident that once the new directors are elected, they will add a powerful voice inside the Midwest Boardroom and urge their fellow directors to behave fairly and consider all options and opportunities for the company in the interests of all shareholders. We urge shareholders to protect the value of their investment and vote for Mr. Albertine, Mr. Erickson and Mr. Kalmbach on the BLUE proxy card,“ concluded Mr. Leonard.

Midwest shareholders who have questions about how to vote their shares may call AirTran’s proxy solicitor, Innisfree M&A Incorporated, toll-free at 877-456-3422. (Banks and Brokers may call collect at 212-750-5833).

About AirTran Airways

AirTran Airways, a Fortune 1000 company and one of America’s largest low-fare airlines with more than 8,600 friendly, professional Crew Members, operates more than 700 daily flights to 56 destinations. The airline’s hub is at Hartsfield-Jackson Atlanta International Airport, where it is the second largest carrier. AirTran Airways‘ aircraft features the fuel-efficient Boeing 737-700 and 717-200 to create America’s youngest all-Boeing fleet. The airline is also the first carrier to install XM Satellite Radio on a commercial aircraft and the only airline with Business Class and XM Satellite Radio on every flight. For reservations or more information, visit http://www.airtran.com (America Online Keyword: AirTran).


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