Southwest Airlines to bid for ATA Airlines assets

By Jeff Pines

Washington, Dec. 10 - Southwest Airlines said it plans to bid more than $100 million for certain assets of ATA Airlines Inc.

The Dallas-based discount carrier said it will submit its bid with the U.S. Bankruptcy Court for the Southern District of Indiana on Friday for six ATA gates at Chicago Midway Airport.

As part of the bid, Southwest is willing to enter into a code share agreement with ATA, covering certain flights from Chicago Midway to nine ATA domestic nonstop destinations. The code share, which will commence next year, could generate additional annual revenue in the $25 million to $50 million range for each airline. Southwest said it estimates its annual traffic would grow, overall, about 1 percent as a result of the proposed code share.

The stalking horse bidder for 14 gates at Midway is AirTran Holdings Inc., which is offering $89.96 million.

Indianapolis-based ATA filed for bankruptcy on Oct. 26. Its Chapter 11 case number is 04-19866.

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