A week after the acquisition of Mesaba was completed by Northwest (NWACQ), the major airline assigned its 36 76-seat CRJ900s it has ordered to Mesaba, is soon-to-be acquired subsidiary. The move will likely mean the recall of pilots and, perhaps, even more hiring at its Airlink partner.

The aircraft are part of a 72-aircraft regional jet order, placed last October, which included 36 Embraer 175s, scheduled to be operated by Compass Airlines, Northwest's new low-cost regional service. (RAN, October 9, p.1)

Mesaba is subleasing the aircraft from Northwest, giving the regional 86 aircraft, still 14 shy of the 100 it operated a year ago. Northwest reduced its fleet to 50 aircraft last year with the resultant traffic reduction of 42 percent and passenger drop of 34 percent to 3.8 million.

At the time of its order, Northwest optioned additional 96 Bombardier and 36 Embraer 76-seat aircraft. They both will be configured with 12 seats in first class and 64 seats in coach class. Both new aircraft types will lower Northwest's operating costs over the aircraft they replace, including the Avro Regional Jet (ARJ) 85 through a combination of significantly lower fuel consumption along with inherent maintenance cost advantages. The order was part of an agreement with Bombardier, GECAS and Export Development Canada to restructure the existing 126 CRJ200 aircraft fleet. This agreement includes the return of 15 previously rejected CRJ200 aircraft back into the Northwest Airlink fleet and marked the completion of Northwest's CRJ fleet restructuring.

The new aircraft will be the largest in Mesaba's fleet which also includes 49 Saab-340s and one CRJ. The agreement reverses fortunes for Mesaba which has been an Airlink partner for over 20 years. Mesaba must gain FAA approval for the jets before they go into service. The Airlink program recently signed a 10-year extension with Pinnacle for the operation of 124 CRJ200s and 17 CRJ100/400 aircraft for Northwest. (RAN, January 8, p.8)

In other news, Goldman Sachs Group is acquiring Mesaba's unsecured claim against Northwest for $125 million, paving the way for the acquisition of the regional airline by the major carrier. Goldman Sachs won the bid in a telephone auction with 86 percent of the $145 million value of the claim that includes lost profits, unreimbursed expenses, fees and other related costs incurred when Northwest cut Mesaba's Airlink fleet by 28 percent, missed $130 million in payments and did not deliver aircraft as promised. This would give Goldman Sachs a stake in the major carrier since unsecured creditors will be paid in stock when it emerges from bankruptcy. While it is unclear what the stock will be worth, court papers indicate it could be at least $17.30 a share, according to local press reports. Mesaba, thanks to the acquisition by Northwest, plans to pay its debts in full when it emerges from bankruptcy in April.