LH to consider dumping B6 stake...
 

Source: http://online.wsj.com/article/BT-CO-...22-711262.html


My take is that this was just a place to park $; nothing more. Assuming the ROI was poor, what implications does this have long term for B6?

Worst case; some hedge fund takes over, cleans out the management and employs a scorched earth policy to wring every penny then can before selling it themselves a few years down the road.

Hard to believe the RoI was poor based on the numbers.

And with only ~16% and a single seat on the board at stake I'm not sure anyone could effectively implement a "scorched earth" policy that would destroy the company.

The ATI++ arrangement with UA, AC and others makes the utility of B6 as a feeder and partner somewhat lower. And there's not much of a need for LH to try to snag some extra JFK slots from the B6 portfolio these days. And it also wasn't long ago that LH acknowledged they were mostly just buying the stake because they saw an upside to the B6 business model and the currency rates at the time.

If we see BA move on these shares, B6 is(eventually) headed to OW. ^

This is speculation on my part, but any AA investment will probably happen after they go through their prepackaged Ch 11. Whether B6 is majority owned by AA/BA or merged into AA outright will depend on what happens to union contracts in bankruptcy.

Could we see B6 convert to a miles based FFP versus their current points based system?

when you lose the kind of money that B6 did this past quarter, I'd wanna leave to!

:confused:

http://investor.jetblue.com/phoenix....684&highlight=

Doesn't this indicate that they made a profit (net income $35 million)?

should've said, when you have profits that are down over 40%, its time to make change.