Midway Asset Sale Scrapped

Northwest Airlines Inc. abruptly withdrew Wednesday from a deal to buy the remaining assets of Midway Airlines Inc., leaving the bankrupt carrier shocked at the loss of what may be its last chance to stay aloft.

Northwest said its board voted not to approve the deal late Tuesday after management accused Midway of overstating profitability rates in a report to the Department of Transportation.

Midway has vehemently denied the allegation, and said Wednesday that it was shocked and disappointed by the move.

“Northwest’s actions over the past several days, which culminated in their announcement today, confirm to us that Northwest has consistently refused to negotiate in good faith and in a timely manner,” Midway Chairman David Hinson said in a statement.

Midway President Thomas Schick told Reuters that the airline will seek legal action against Northwest and added that the carrier cannot remain flying for long.

Asked how long Midway can continue operations without the Northwest deal, Schick said, “We’re looking at that . . . certainly it is not a long period of time.”

Industry analysts say Midway may not be able to survive for very long without the Northwest deal, which would have provided jobs for all of Midway’s 3,800 Chicago-based employees.