Feb 2, 2006 12:32 am US/Central
Tom Petters Considers Buying Sun Country
Mendota Heights, Minn. (AP) ―
Tom Petters said Wednesday he's negotiating to add Sun Country Airlines to his diverse group of holdings.
Petters, who bought Polaroid last year and owns half of Fingerhut Direct Marketing, has an exclusive 60-day window for reaching a deal with Sun Country.
Despite high fuel prices, Petters said he sees a potentially good opportunity.
"The business we're in is in investing in businesses where we see opportunities to grow," he said. "This particular one seems to be one in which the current owners are doing pretty good."
Petters, 48, is chairman and CEO of Minnetonka-based Petters Group Worldwide. Its 15 companies include Polaroid, Fingerhut, a television shopping network and other businesses that collectively employ about 3,200 people. Its holdings include Petters Aviation, which owns a Boeing 727 for corporate travel.
He said he doesn't foresee any major changes in staffing at Sun Country, and its headquarters would remain in Mendota Heights. About 800 people work for the airline.
"This transaction, if completed, would be very positive for our employees and our customers," said Jay Salmen, president of Sun Country.
Sun Country emerged from bankruptcy in 2002 when it was purchased by MN Airlines, an investor group led by Twin Cities businessman and lawyer Robert Daly, for $3.1 million.
It currently operates a fleet of 12 Boeing 737s, focusing on leisure destinations and a few select business markets. It flew about 1.6 million passengers last year and had revenue of $204 million, Salmen said.
Salmen said Sun Country would be profitable if not for high fuel prices.
"We are optimistic that this is a good thing and that the company will continue to grow and prosper," Bruce Achterling, chairman of the Sun Country pilots union, said of the potential acquisition by Petters.
Petters said he is assessing Sun Country's assets and financial prospects and will decide relatively soon whether he wants to proceed.
He pointed to other low-cost carriers including JetBlue, AirTran and Southwest as healthy companies, but said Sun Country would not mimic their business models.
"I think we'll try to do something different. We're not looking to be JetBlue. We're not looking to be Air Tran. We're not looking to be Southwest," Petters said.
He declined to comment on possible schedule or route changes for Sun Country, but said it would continue down the path of what its owners have done and its goal will be increasing service.
As to whether a new Sun Country would try to challenge a weakened Northwest Airlines Corp., which dominates the local market, Petters said: "I think Minnesotans deserve a better product. Let's leave it at that."
-------
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.)
Click to enlarge
Stumble It!
