Northwest Settlement Gave Pinnacle Cash to Do Delta Deal

"The diversification strategy at Pinnacle is coming along quite nicely," said analyst Doug Abbey.


"It's not the same teething pains of a brand-new plane. Pinnacle will be able to integrate it immediately. And a more common fleet costs less to maintain. It's a very productive way to grow," Abbey said.

The news acts as a counterbalance to the contraction Pinnacle experienced late last week when Northwest said it would be reassigning 15 50-seat planes to wholly owned subsidiary Mesaba Airlines because Pinnacle had not met the March 31 deadline for getting a deal with its pilots.

Because the planes were not committed to Pinnacle on a long-term basis, Pinnacle is entitled to the full amount of its unsecured $42.5 million claim.

Pilot union spokesman Wakefield Gordon doubts the Delta deal will do anything to "push the labor agreement to a conclusion.

"But I will say that management did a good job of putting together a strategic deal on this. They gave planes with an OK-profitability back to Northwest and got cash that allowed them to make the Delta deal. That's good strategic decision-making."

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Pinnacle Airlines

President, CEO : Phil Trenary

Address : 1689 Nonconnah Blvd.

Memphis employees : About 1,000

Stock price : Nearly tripled since late August. Closed Monday at $16.37, down 3 percent.

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