Western U.S. regional carrier Mesa Air Group (NASDAQ:MESA) surprised the airline world yesterday with a $512 million stock offer for Atlantic Coast Airlines (NASDAQ:ACAI).

Mesa offered 0.9 of its shares for each share of Atlantic Coast, valuing the deal at $11.30 per share of the target, a 25% premium over its previous $9.02 close. Atlantic Coast shares took off to the tune of 23%, and the company said it would consider the offer.

Atlantic Coast operates regional service for United Airlines, now in Chapter 11 bankruptcy proceedings, but at the end of July said it would end the relationship and start a new life as a discounter out of its Metro Washington, D.C. hub at Dulles Airport.

Mesa serves United as a regional carrier in the West. Buying Atlantic Coast would immediately almost double its fleet from 149 planes to 295, without the need to snarf scarce financing for fleet expansion.

Atlantic Coast would get a decent price for its shares and presumably forego the risk of a new entrant to the low-fare world, dominated by Southwest Airlines (NYSE:LUV), JetBlue (NASDAQ:JBLU), and AirTran Holdings (NYSE:AAI).

Mesa shareholders proved less enthusiastic, pulling the stock down 8%.

What do you think? Tray tables in the upright position please. Our Motley Fool community takes off on the proposed deal on our Atlantic Coast discussion board and welcomes you!