More News!! from Mesa..and Atlantic CoastMesa surge leads strong airline rally
By Shawn Langlois, CBS.MarketWatch.com
Last Update: 11:01 AM ET Dec. 23, 2003
SAN FRANCISCO (CBS.MW)--- A widespread rally in airline stocks Tuesday was punctuated by a surge in Mesa Air Group after the company halted its hostile takeover bid for Atlantic Coast Airlines.
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The Amex Airline Index added 1.1 percent to 61.07, joining in the broad market surge. See Market Snapshot.
Shares of Mesa Air (MESA: news, chart, profile) jumped up more than 3 percent and touched a multi-year high of $13.75 early in the session after the regional airline's announcement. Atlantic Coast shares (ACAI: news, chart, profile) reacted with a 2.1 percent dip to $9.01.
Mesa's decision came a day after UAL canceled an agreement that could have had Mesa replace Atlantic Coast Airlines as United Express regional airline operator at Dulles International Airport if Mesa succeeded in its hostile takeover of Atlantic. See full story.
Atlantic Coast Airlines had said before the takeover attempt that it plans to start a low-fare carrier operating out of Dulles and later accused United of backing Mesa in an attempt to thwart its plan. The Justice Department's antitrust division had begun investigating the claim ahead of Mesa's latest move.
Shares of UAL (UALAQ: news, chart, profile), parent of United Airlines, rose 1.6 percent to $1.56.
Other stocks taking out yearly highs included Continental (CAL: news, chart, profile), which was up more than 2 percent at $16.14, and Alaska (ALK: news, chart, profile), which gained 16 cents at $27.40. AirTran (AAI: news, chart, profile) added 2.3 percent to $11.60 and ATA Holdings (ATAH: news, chart, profile) climbed 3.2 percent to $9.80.
On the flip side, Southwest Airlines (LUV: news, chart, profile) was one of the rare losers, shedding 9 cents to $16.08. A Wall Street Journal article Tuesday said Southwest is considering a shift in strategy as it confronts new low-fare competitors.
Shawn Langlois is a reporter for CBS.MarketWatch.com, and the editor of its community message boards.