Jul. 5--Bryan Bedford and Sardar Biglari are letting it all hang out in their recent chief executive moves.

If the Republic Airways Holdings CEO is right, the regional airline could bust out nationally. Same for the Steak n Shake chief.

If they're wrong, they're toast.

The gambits are not irresponsible, but they are calculated risks.

What are Bedford and Biglari up to?

Bedford's company is buying Midwest Airlines for $31 million. It's also made a qualifying bid of $109 million to buy Frontier out of bankruptcy. The moves will solidify Republic's position as a contract carrier to major airlines such as American, United and US Airways and, if the Frontier deal pans out, nearly double its size.

That's not a bad play. It's how national carriers will come into existence in the future because nobody has the ability to buy planes and enter the market like Continental.

Investors like the move. Republic's stock price is up more than 50 percent since June 23. It reported increased passenger counts this week, too, so things are looking up for the 4,500-employee company with 1,200 daily flights.

Here's the risk: The company is highly leveraged, and the new deals would add to its debt load. Republic's balance sheet showed $3.3 billion in assets and $2.7 billion in liabilities. Its market capitalization, even with the recent increase in stock price, is just $220 million. While the company posted an $84 million profit on $1.4 billion in revenue last year, Republic is vulnerable if there is more turbulence in the airline industry.

It could pay off, and the company could make a lot of money. Or, if things get worse, Republic could be the next airline in financial trouble.

Biglari's big risk is far more personal. The Texas investor forced his way into Steak n Shake's executive suite last year and, after allegedly searching for a CEO, the board Biglari chairs named him to the top operating job. Last week he more than tripled his CEO salary to $900,000 a year, or about a third more than his predecessor.

But Biglari has no contract, no bonus and no options to buy stock. He's already the company's biggest shareholder, with more than 13 percent of the stock. And he has his interests perfectly aligned with shareholders.

Biglari and his fellow shareholders are doing pretty well: Steak n Shake stock is up more than 40 percent this year.

So far, so good, but the journey's just begun for Bedford and Biglari.

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