Minnesota weather can be gloomy, so MN Airlines aims to be a ray of sunshine. The carrier, operating as Sun Country Airlines, serves nine markets year-round and another 22 destinations seasonally, in the US, Mexico, and the Caribbean from its hub in Minneapolis-St. Paul. US cities served by the carrier include Las Vegas; Los Angeles; New York; Orlando; Phoenix; and San Francisco. Sun Country also offers flights to selected destinations in Mexico and the Dominican Republic. It maintains a fleet of about 10 Boeing 737s. Sun Country in 2011 completed a 28-month trip under Chapter 11 bankruptcy protection, forced by former parent, Petters Group Worldwide, which came under investigation for fraud in 2008.
It's been rough skies for Sun Country as it struggled to emerge from bankruptcy. The company's reorganization -- calling for a conversion of about $60 million in debt to equity -- was approved by a bankruptcy court in fall 2010, but the US Department of Transportation's questions regarding Sun Country's foreign ownership delayed closure.
Sun Country filed for bankruptcy protection in fall 2008 after it was unable to obtain a short-term loan from the Petters Group. The assets of its former parent company were frozen because of a federal fraud investigation, which resulted in Petters Group CEO Tom Petters being convicted in late 2009 for running a $3.65 billion Ponzi scheme. After filing for bankruptcy, Sun Country's stocks were transferred to a court-appointed receiver, former federal prosecutor Doug Kelley, who was charged with selling off Petters Group assets. Sun Country maintained normal operations and even turned a modest profit.
A federal court settlement in spring 2011 gave Kelly about 55% ownership of the airline, Whitebox Advisors 45%, and Sun Country CEO Stan Gadek less than 1%. The owners are pursuing a deal to sell it.
A sale promises stability for Sun Country, which aims to grow by increasing frequency on popular leisure routes rather than on adding cities to its network. In addition, the carrier wants to gain military charter business, for which it has not previously competed. By identifying such pockets of new revenue, Sun Country is better positioned to weather a difficult industry environment, brought on by unexpectedly high fuel prices and a plunge in consumer demand.
Petters Group bought Sun Country in fall 2006 with backing from Minneapolis investment firm Whitebox Advisors. – less