23 May 2008

Mesa Air Group teetering?

Jonathan Ornstein's Mesa Group appears teetering on the brink of bankruptcy.

Yesterday (May 22) in a formal filing with the US SEC, Mesa Air Group said yesterday that if Delta Air Lines succeeds in ending its service agreement for 34 ERJ-145s, MAG may have to file for Chapter 11 bankruptcy protection as the loss of business and the resulting cash crunch would make it impossible for the regional to continue operations.

Mesa under the somewhat (I seem to recall) reportedly litigious Mr Ornstein has been a thorn in the side of many people. (His company sued Plane Buzz Blog). Mesa's GO! subsidiary was cited both in US Congressional testimony and in various published reports on the Aloha Airlines Bankruptcy of using "Predatory Pricing" tactics to force the 60 year old Inter Island Airline into Chapter 7 for its passenger operations.

Last night Mesa's stock closed down valuing the whole company at approx $12 million.

You can almost hear those lawyers revving up their engines.

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