Are Investors Ready to Forgive U.S. Regional Airlines?
Skift Take
U.S. bankruptcy law is more forgiving than in many countries, which is why many airlines have had multiple iterations. Now, eight years after filing for bankruptcy, Mesa Air Group again wants to be traded on public markets. Assuming it goes forward with an IPO, it'll be interesting to see if investors return.
The United States may not fund airlines directly, but its laws help them succeed. Just look at Mesa Air Group, a regional airline that filed for bankruptcy protection eight years ago.
Back then, it was in rough shape. Its aircraft were dirty, and its flights were tardy so often that Delta Air Lines canceled a contract with one of its subsidiaries. Perhaps worse, Mesa operated an antiquated fleet, with too many turboprops and 50-seat jets, both of which had fallen out of favor among major carriers.
But in the United States, bankruptcy can cure all. And now, according to a new filing, Mesa is a profitable private company with a modern fleet and substantial growth opportunities. So Mesa, with the same CEO as eight years ago, wants to go public again.
This is not rare. All three major U.S. carriers have filed for bankruptcy protection within the last 13 years, and they're now successful publicly traded companies. Some investors have refused to return, but many have given airlines another chance.
If Mesa goes public again, it'll be interesting to see how investors respond. Regional airlines can be sustainable profitable businesses, but they have les
