MAIR Holdings (MAIR) – $5.17
MAIR is a very low risk / high uncertainty opportunity that has identifiable catalysts to unlock value in a reasonable amount of time. MAIR is a holding company that at the moment owns a very small regional airline (Big Sky Airlines) but is a majority cash and investments. It previously owned Mesaba Airlines, which went bankrupt in 2005, and was subsequently sold to Northwest Airlines (NWA) in April of this year. The current valuation numbers are below: ($Millions)
|Cash & investments||61.44|
|Receivable from Mesaba||13.50|
|Payable to Northwest (shares)||(11.07)|
|Restricted cash (see below)||13.11|
|Total||76.98 ($5.13 per share)|
I look at this value as the downside, assuming management doesn’t do something stupid with the cash. There are two activist investors (owning over 14% of the company) pushing MAIR to distribute excess cash and sell Big Sky, so I’m hoping this helps things out a bit. The restricted cash account is collateral for a plane hangar MAIR guaranteed to Mesaba bondholders. As long as MAIR finds a sublessor for the hangar by March 2008, the $13mm will be released.