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Home > BizTimes Daily > Archives > January 12, 2007
Local business executives support Midwest
Published January 12, 2007 - BizTimes Daily
Executives at several Milwaukee-area small businesses are expressing their opposition to AirTran Holdings Inc.'s hostile attempt to take over Midwest Air Group Inc., the Oak Creek-based parent company of Midwest Airlines.
In the past week, AirTran Holdings chairman and chief executive officer Joseph Leonard launched a grassroots scenes campaign to convince local business executives to support his company's takeover attempt. According to sources, Leonard sent registered letters to about 150 local CEOs, including several members of the board of directors of the Council of Small Business Executives (COSBE), an organization affiliated with the Metropolitan Milwaukee Association of Commerce (MMAC).
In the form letter, Leonard touted the virtues of his company and says Milwaukee will be better-served if AirTran acquires the Oak Creek-based parent company of Midwest Airlines.
However, several COSBE board members responded by telling SBT that they believe the Milwaukee community and economy would be better-served if their hometown airline remains independent. Here is a sampling of their responses:
- "Midwest is truly special, and we hope they always stay that way … Our fear is that anyone who would buy Midwest Airlines would turn it into just any other airline, most of which we Milwaukeeans simply settle for when we fly. We just don't like flying on most other airlines … There is something special about our hometown airline. We are willing to pay fares and food and beverage fees to support them and do what we can to keep them flying in the air … and financially. What value! Happy customers who sell your services for you! (To AirTran) Please back off the acquisition and just compete." - David Kliber, president and chief executive officer of S-F Analytical Laboratories Inc. in West Allis.
- "I echo Dave Kliber’s reflections. Midwest Airlines has been a significant signature for Milwaukee and the state. Business leaders across the country select Midwest over other airlines once they have had the experience. While it is true that since 9/11, Midwest Airlines has needed to make tough decisions in order to stay afloat, each decision was made with the 'best care' on the ground to support the 'best care' in the air. Each step of the way, Midwest leaders have considered the impact of their decisions on their customers and to the community. The relationship that Midwest has fostered with this community is unparalleled. The organization has created a true partnership, not only by providing extraordinary service, but also by contributing to the health of this city in numerous and generous ways. It may be tempting for stock holders looking for higher return on investments to respond to the recent offer from Air Tran. However, in the end, it will represent a significant 'cost' to this community if Midwest is acquired." – Karen Vernal, president of Vernal Management Consultants LLC in Milwaukee.
- "I share the same concerns as Dave (Kliber). I received the same letter when I returned from Arizona last week. Midwest is a part of this town. To sell it to an outside entity would be like amputating a limb from our tree of prosperity. I know many of the pilots and flight attendants personally after being a frequent flyer for many years. It is our hometown airline, and that would disappear if AirTrans was successful in its endeavor. I am not only concerned about the lost jobs to the community, I am concerned about the identity that Midwest has created with Milwaukee. No one who has flown their service between Milwaukee and New York or other Eastern cities can believe that such an airline is based in Milwaukee. This airline has raised our image in the marketplace and has drawn customers away from O'Hare to fly out of Mitchell. I am afraid if AirTrans consumes Midwest, we will experience a reversal in that trend, and our new train station and the recent expansion at Mitchell Field will become poor investments. Now that it is a 'hostile' takeover, we enter into another phase of the battle. It is now up to the individual investor to set aside individual economic considerations and think about our community. Long term, Midwest Airlines would be better-served being independent and based in Milwaukee. We should not forget that it is our hometown airline. Let's keep it that way." – Cary Silverstein, president and CEO of Strategic Management Associates LLC, Fox Point.
- "I got the same letter (from Leonard). And the chairman (Leonard) goes on at great lengths about the commitment to the community in Atlanta. Fine that they've done that. But there is no commitment in his letter for Milwaukee. Inference, yes, commitment, no. How many times have we seen that in this state and this city where local companies are bought up by national companies, and they say they're going to stay involved in the community, and they do it for like a year or so, and then nothing?" - Arvid "Dick" Tilmar, vice chairman of Diversified Insurance Services Inc. in Waukesha.
- "I did receive the letter, and while Mr. Leonard certainly tried to hit home with their community involvement in Atlanta, no commitment whatsoever was made to Milwaukee. As a community, the significance in having a hometown presence with Midwest Airline cannot be overstated. Certainly, it is great that Airtran is involved with the Atlanta community, but that does little for us here. No doubt, their support, if any, to the Milwaukee community will be far less than what we have experienced with Midwest. I am also a Midwest customer and fan, and they are the first choice whenever and wherever I fly. I am not a shareholder, though in consideration of the chronic challenges this industry experiences. The increased share offer is probably presenting a difficult decision for major shareholders." – Rob McNamara, president of F.J.A. Christiansen Roofing Co. Inc., Milwaukee.
(Editor's note: SBT has obtained a copy of the form letter Leonard sent to Milwaukee-area CEOs. To read the entire letter, visit http://www.biztimes.com/biztimes/AirTran_letter.pdf)
