Flytolive

Are you sure? It is quite a coincidence.

It is amazing how some people can be so wrong, so often and remain so sure of themselves. Is that just a coincidence?

AllenAllert

Time will tell but we'll see. Jobs and careers depend on it.

Andy

I think you're overstating the magnitude of this. The hedge funds are simply trying to greenmail United. ( https://en.wikipedia.org/wiki/Greenmail ). They're probably looking for somewhere on the order of $3B or so for their combined ~26 million shares in a private block sale to United. The $3B private block sale is a WAG on my part.

I think that this is the brainchild of Brad Gerstner, the CEO of Altimeter Capital. Gerstner was a partner at PAR Capital Management which appears to be why they're involved with this. He's made large concentrated bets with his hedge fund in the past and this is no different. His strategy will eventually backfire and the hedge fund will blow up, but it's OPM (Other People's Money) so Gerstner's going to ride the gravy train until it falls apart and then probably create a new hedge fund after closing this one.

I dug through Altimeter and PAR's SEC filings and have compiled a history of their holdings in United. I've only gone back as far as 12/31/2011. Here are the links to the SEC filings:
https://www.sec.gov/cgi-bin/browse-e...lude&count=100
https://www.sec.gov/cgi-bin/browse-e...&hidefilings=0
https://www.sec.gov/cgi-bin/browse-e...ion=getcompany

Altimeter Capital Management, LP
12/31/2011 2,359,108 SH
3/31/2012 1,406,553 SH (remained same until 12/31/2012)
12/31/2012 178,302 SH
3/31/2013 514,502 SH
6/30/2013 2,195,145 SH
9/30/2013 2,895,745 SH
12/31/2013 1,980,538 SH
3/31/2014 2,053,621 SH
6/30/2014 2,549,680 SH
9/30/2014 2,866,645 SH
12/31/2014 4,812,903 SH
3/31/2015 4,480,179 SH
6/30/2015 4,748,637 SH
9/30/2015 9,300,000 SH
12/31/2015 10,650,000 SH
3/8/2016 11,509,268 SH
PAR Capital Management Inc/PAR Investment Partners LP
No shares owned until 9/30/2014 filing
9/30/2014 800,000 SH
12/31/2014 1,805,000 SH
3/31/2015 1,885,000 SH
6/30/2015 2,642,632 SH
9/30/2015 5,380,000 SH
12/31/2015 6,423,600 SH
3/8/2016 14,389,711 SH


Based on the purchase dates, I suspect that this scheme has been planned since late 2014.

El Guapo

So PAR has more than doubled their holdings in the last 3 months??
This whole thing is so shady

Andy

That's why I listed the number of shares owned in each quarterly report along with the link to the SEC filings. First guess is that this could have been hatched in late 2014, but it could also be argued that this plan was hatched in the third quarter of 2015 ... FLIBS was fired on Sep 8.

I don't think it matters when the plan was hatched, but their excuse that UAL has underperformed for several years is pure BS since both hedge funds didn't ramp up their holdings until 2015.

gettinbumped

For a long time, I just thought you were a giant d$&k. But upon further reflection I realize that I simply feel sorry for you. Your world is so full of psychotic episodes that it must be stressful living with a parade of conspiracy theories. When one consistantly finds themselves not only in the minority, but on the fringe, it must be very lonely.

I hope that you soon get a long, and if required, permanent vacation where you can quiet your mind and find some peace. I don't say this out of anger, but of pity. Good luck to you Allen.

AllenAllert

I'm not surprised that you or one of the other shills didn't start with the personal attacks earlier. First and foremost, I didn't cause the attempted takeover of United's Board by my writings - just a line pilot with an opinion. It's about the money but the timing is about the perceived weakness of the CEO/Board members. It's fact, not fiction.

Yes, while a majority was trying to figure out how to spend the 13% raise, the outsiders were plotting the timing of when to launch their attempted takeover. I was thinking DL, SW and AMR would take advantage of the weakness, but they were content to hold to capacity and with lower fuel cost make money while maintaining status quo. I know you think this is about the employees but it's not. It's about the money and all one has to do is a little study of Texas Air, Continental and TWA of recent history.

There's an assumption here that OM and the Board have a master plan to keep the outsiders at bay. They may and it may work but the consequences can be as bad or worse than the outsiders plan by loading the company up with debt or a big shareholder payout. The outsiders don't need a majority, they only need enough to call the question and that takes it out of OM's and boards hands and gives it to the shareholders. Hopefully, OM doesn't do something that puts the company in a worse position and ultimately leaving the employees to pay for it.

awax

Like faking a heart attack?

Andy

There are several ways to fight greenmailers, and these guys don't have enough money to successfully greenmail United. With the latest disclosure of UAL stock holdings, I'm guessing that Altimeter Capital is approaching 40% of its assets in United stock. That's very risky on Gerstner's part.

IF UAL's board wanted to get nasty - and blow up Altimeter Holdings - all they need to do is cancel planned buybacks and do a new stock issuance, effectively watering down the value of the stock. If they do it in a 'normal' poison pill strategy, the company would allow all existing shareholders except Altimeter and PAR to buy shares at a discount. For instance, United could offer all current shareholders the option to buy one new share for each existing share that they have at a price of, say, $30/share. This would drive down the value of United stock and would likely cause Altimeter Capital to close its doors.

And there are plenty of other defensive strategies that can be used, although I suspect that the board won't need to resort to such measures.

I read an interesting article last night that said that Altimeter Capital first got upset with UAL's BOD when John Rainey, the former CFO, left United for Paypal in August. My personal opinion is that having Rainey leave was a good thing - he ticked off a LOT of loyal United customers when he called them 'overentitled elites'. That was total jacka$$ery on Rainey's part and he should have been fired for that comment. United Angers Frequent Fliers By Calling Some `Over-Entitled? - The Middle Seat Terminal - WSJ

There are a ton of moving parts here and I don't think you can point to a single event that caused the hedgies to try this. It's a distraction, but when the dust settles, this may end up strengthening United by changing a few BOD members with ones that are better fits.

AllenAllert

And for those that do selective reading to attack maybe a cut/paste is in order:

We'll see if OM is the guy to lead United through this without damaging the airline in the process.