From Atlanta, with love for AirTran

    Last updated on May 13th, 2019 at 02:43 pm

    AirTran Holdings Inc. chief executive officer Joseph Leonard continued his campaign to pressure Oak Creek-based Midwest Air Group Inc.’s board of directors to accept his company’s hostile takeover bid this week.

    Leonard’s latest letter to the Midwest board of directors contained his usual rhetoric about how the company will be better-served if the board just gives in and sells. However, Leonard added a new wrinkle Monday by attaching a letter from Atlanta Mayor Shirley Franklin.

    AirTran Airways, which is based in Orlando, Fla., has expanded and made Atlanta a regional hub. Hartsfield Jackson Atlanta International Airport, which also is a hub for Delta Airlines, has grown to become the busiest airport in the world.

    The letter was written by Franklin and addressed to Leonard. Franklin’s letter, which was dated April 2, contains mostly glowing praise, adoration and gratitude for AirTran.

    "The Atlanta consumer has received numerous benefits from Air Tran Airways, including the tremendous savings created by offering low fares every day. By offering low fares, AirTran Airways has stimulated traffic at Hartsfield Jackson Atlanta International Airrport," Franklin wrote. "While it is the busiest airport in the world, we are fortunate to have two airlines with large hubs at the airport … Finally we appreciate AirTran Airways’ presence in the community. Your community support has been inspiring. Whether it is supporting the homeless, the hungry, the poor, the less fortunate, the under-educated, AirTran Airways shows its compassion through its deeds."

    The letter does not seem to have much context. Why would the mayor of Atlanta just write a letter out of the clear blue to smooch up to AirTran? Did Leonard and AirTran ask for her endorsement, given the company’s ongoing attempt to sway Milwaukee and Midwest?

    When asked about the context of Franklin’s letter, Catherine Woodling, media relations officer for Mayor Franklin, told SBT, "I can confirm that the letter did come directly from the mayor to the CEO of Airtran as a letter of support for the company. It was written to thank them for their contributions to the community and to congratulate them on their wonderful business practices. To my knowledge, it was not written specifically to be sent to the Midwest Air Group."

    Again, why would the mayor of Atlanta just write a letter out of the clear blue to smooch up to AirTran?

    Well, I have found 10,000 reasons. As in $10,000. That’s how much money AirTran and its top executives donated to Franklin’s re-election campaign in 2005, according to her campaign contribution disclosure report to the State of Georgia.

    AirTran’s political action committee (PAC) maxed out with a $2,000 donation. Leonard himself donated $1,000, as did AirTran senior vice presidents Stephen Kolski, Richard Margurno and Alfred Smith.

    Heck, AirTran chief information officer Rocky Wiggins looks like a piker, donating only $500 to the Franklin cause.

    Now, this is not to say that anyone here has done anything at all illegal or even immoral. By all accounts, Franklin is a well-respected public servant. And Woodling was very cooperative, polite and forthcoming about contributions to the campaign. Furthermore, it’s certainly within AirTran’s right to support a political candidate of its choosing.

    But it’s been my experience that it’s always instructive to follow the money. After all, that’s what this high-stakes corporate game of cat and mouse will come down to … is AirTran’s offer of $15 per share enough to convince the Midwest Air Group board to sell the company?

    To read the complete letters by Leonard and Franklin, visit http://sec.gov/Archives/edgar/data/948845/000119312507077188/dex99a39.htm.

     

    Steve Jagler is executive editor of Small Business Times. He can be reached at steve.jagler@biztimes.com. Is there an issue you feel passionate about? Share your viewpoints by sending them to him for posting in the Milwaukee Biz Blog.

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