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Pinnacle Airlines Corp. today announced the purchase of Colgan Air, Inc., which maintains its headquarters in Manassas, Virginia. Pinnacle Airlines Corp. is the parent company of Pinnacle Airlines, Inc., a regional airline doing business as Northwest Airlink.

Pinnacle Airlines Corp. will pay $20 million for all of the issued and outstanding capital stock of Colgan Air, with $10 million in the form of an immediate cash payment and $10 million in the form of a one-year note secured by the stock of Colgan Air. The acquisition will be completed today subject to any applicable regulatory review.

Colgan Air is a premier turbo-prop regional airline operating as Continental Connection, United Express and US Airways Express. Launched in 1991 as a family-owned and operated company, today Colgan Air offers 354 daily flights to 53 cities in 13 states. Colgan is recognized for the exceptional service levels it provides its Customers and is a leader in providing air service to small and medium-sized cities in the United States. Colgan operates 39 Saab 340 and 11 Beech 1900 regional airliners, and has hub operations in Boston, Houston, New York, Pittsburgh and Washington, D.C. Colgan Air employs approximately 1,100 People and transported nearly 1.5 million Customers in 2006. Colgan has experienced strong revenue growth over the past years. In 2005 Colgan had revenues of approximately $137 million. Colgan projects that it will have revenues of approximately $190 million in 2006.

"This is a strategic move for our organization and offers Pinnacle Airlines Corp. extraordinary opportunities by diversifying and expanding into multiple platforms," said Philip H. Trenary, President & CEO of Pinnacle Airlines Corp. "Colgan Air has a highly productive workforce with knowledge, experience and fantastic dedication."

This purchase provides Pinnacle Airlines Corp. with two separate platforms for growth.

Mr. Trenary continued, "The purchase of Colgan Air gives our corporation access to and relationships with three of the largest carriers in the United States: Continental Airlines, United Airlines and US Airways. When combined with Pinnacle Airlines, Inc.'s airline services agreement with Northwest Airlines, Pinnacle Airlines Corp. now code-shares with a significant proportion of the major airlines in the United States. These new relationships will be invaluable to helping grow both Pinnacle Airlines, Inc. and Colgan Air."