AA to Sell Eagle Unit

[FlyingPhotog]

http://biz.yahoo.com/ap/071128/amr_american_eagle.html?.v=2

FORT WORTH, Texas (AP) -- AMR Corp. said Wednesday it plans to divest its American Eagle regional carrier in a sale or spin-off next year, supporting Wall Street speculation that major airlines will sell assets to streamline their businesses and gain capital.

AMR said the divestiture will allow it to focus on its mainline American Airlines business while ensuring access to a cost-competitive regional carrier. It expects to enter a "mutually beneficial" air services agreement under which American Eagle will continue to operate flights for AMR.

American Eagle operates about 300 aircraft, with approximately 1,700 daily flights to more than 150 cities in North America and the Caribbean. In 2007, American Eagle expects to generate annual revenues of about $2.3 billion.

[DAL767-400ER]

Not surprising to see AMR get rid of Eagle, though the timing surprises me. Would have expected that quite some time ago. Will be interesting to see whether Eagle will now (or down the road) start operating flights for other carriers that don't include AA, meaning something like ATL-HSV for DL for example, not LAX-SAN which is primarily AA, but also codeshared with DL/NW/AS.

[flyingbosshog]

Who do we think will be buying Eagle? Please not MESA!!!!!

Anyone think SkyWest would be interested?

[AA 1818]

What are they going to do to replace all of their Caribbean services? WHAT ARE THEY THINKING?! This is a not-too-intelligent move in that for the services that Eagle provides in the Caribbean, there is no match. Maybe in the U.S. - yeah, they can get away with using other carriers (although Chataqua (sp?) is HORRIBLE!!!), but in the Caribbean, they are not matched!

[Bok269]

What are they going to do to replace all of their Caribbean services? WHAT ARE THEY THINKING?! This is a not-too-intelligent move in that for the services that Eagle provides in the Caribbean, there is no match. Maybe in the U.S. - yeah, they can get away with using other carriers (although Chataqua (sp?) is HORRIBLE!!!), but in the Caribbean, they are not matched!

No one said AE isn't going to be flying for AA anymore. Selling them off is just going to force them to be competitive with other carriers. I doubt AA would abandon their Caribbean operation, which is one place where they have a near-monopoly. This is going to end up, in all likelihood, like CO and XE.

As for Chautaugua, they are one of the better regionals out there. They are way ahead of Mesa and the like.

[AASuper80Fan]

I am not surprise I knew it was a matter of when not if. AA will not be giving up the Caribbean, Hell will freeze over before AA will dump the Caribbean operations.

[DeltaFlyer]

I dont see a sale of Eagle but a spin-off into a separate company with AA holding a lot of stock so they still have some control of the Eagle operation...

[CathayPacific]

I think they will either go for an IPO or spin it off to their AMR's shareholders just like what they did with SABRE years ago.

[DAL767-400ER]

What are they going to do to replace all of their Caribbean services?

No one, AEagle is not cutting any services. Besides, the majority of Caribbean flying is being done by Executive Airlines, and they are independant of Eagle, having been seperated from them quite a few years ago.

[FlyingPhotog]

Who do we think will be buying Eagle? Please not MESA!!!!!

Anyone think SkyWest would be interested?

I would not be surprised to see TPG (Texas Pacific Group) make the move. They seem to be interested in gobbling up airlines at every chance lately, after bidding for Qantas & Iberian.

[DAL767-400ER]

I would not be surprised to see TPG (Texas Pacific Group) make the move. They seem to be interested in gobbling up airlines at every chance lately, after bidding for Qantas & Iberian.

Too true. QANTAS, Iberia (through BA), Delta (through US), Alitalia, Aer Lingus (through Ryanair). Eagle would only be another opportunity for them.

[z740]

Never thought I'd see this day come.

-Chris

[Bok269]

No one, AEagle is not cutting any services. Besides, the majority of Caribbean flying is being done by Executive Airlines, and they are independant of Eagle, having been seperated from them quite a few years ago.

Executive is a subsidiary of eagle, and the pilots share a seniority list. The article states that they will be divested as well.

[AA 1818]

And so, I ask - If they are to sell Eagle, then Eagle is no longer under a contract of exclusivity (with regards to operations) to American Airlines i.e. other airlines could purhcase slots of operations at American Eagle. Consider that American Eagle really rules the Caribbean, then it is an easy in for another carrier into said Caribbean.

I wonder why American is choosing to finally sell Eagle? Costs too high? Planes to old? In need of Cash/Capital? Eagle wanted to be sold? Why sell Eagle now?

[Crunk415balla]

Wow. Never thought I'd see the day...