Nov 16, 2007 6:48 am US/Central
Petters Group Buying All Of Sun Country Airlines
MENDOTA HEIGHTS, Minn. (AP) ―
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Sun Country operates new Boeing 737-800s, serves hot sandwiches in coach class and has received high marks in national surveys for its friendly customer service.
WCCO
Petters Group Worldwide becomes the sole owner of Sun Country Airlines Friday, buying out Whitebox Advisors that has co-owned the airline with Petters since October 2006.
"They are a hedge fund. We are an operating company," CEO Tom Petters told the Star Tribune Thursday in an interview. "I made a decision to buy out their interest and operate the airline."
The Mendota Heights-based airline has lost nearly $27 million in the four quarters since it was acquired by Petters and Whitebox.
Minnetonka-based Petters Group didn't disclose terms of the transaction.
Sun Country operates new Boeing 737-800s, serves hot sandwiches in coach class and has received high marks in national surveys for its friendly customer service.
"I knew going into this that we would incur losses for sure, unless I was a magician," Petters said, adding that he was prepared to lose money for a while.
"We knew we needed to make certain investments," he said, including upgrading information technology, creating a passenger rewards program and expanding marketing efforts. Sun Country also took delivery of two new planes this year, boosting its year-round fleet to nine. The airline leases additional airplanes for the heavy winter travel season.
As a privately held company, Sun Country must file quarterly financial statements with the U.S. Department of Transportation. Those records show a $9.5 million net loss for the fourth quarter of 2006, a $389,000 loss for the first quarter of this year and a $9.1 million loss for the second quarter.
Company executives told the Star Tribune that their third-quarter report will show a $7.8 million net loss on total revenue of $52 million. Total revenue over the past four quarters was about $230 million, they said.
Sun Country flies to 13 cities year-round, including Las Vegas, New York, Washington and Los Angeles. It serves 20 cities on a seasonal basis, including tourist destinations such as Acapulco and Puerto Vallarta in Mexico. The airline has about 1,100 employees.
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Sun Country Airlines started operating in 1982, with 33 employees.
(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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