Any Guess To Who Ual Will Merge With?
- Thread starter boeing787
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EyeInTheSky
Veteran
boeing787 said:
Bahahahaha.
JAMAKE1
Veteran
Well, I have long thought that a Continental-United combination would be a good one, but I would prefer to see that happen in the form of CO joining the Star Alliance rather than a merger. The synergies of a CO-UA codeshare could perhaps be a lot more fruitful than the UA-US codeshare.
As I have mentioned in previous threads, I think there are some flaws in the Sky Team alliance and with Northwest's strong ties to KLM and Delta's close ties to Air France (and with AF and KL having recently joined forces), my perception is that Continental is the weakest link. Since CO has not alligned itself with a foreign carrier, and with the recent announcement of the HP-US merger, my guess is that there is going to be some reshuffling of partnerships.
I believe that a CO-UA combination, not in the form of a merger per se, but in the form of Continental re-alligning itself with UA and Star Alliance, would position both carriers strategically on the global map: United's strong presence in Asia (and Air Mike, to a lesser extent), domestic hubs in LAX, SFO, DEN, IAH, ORD, IAD, and EWR, United's Heathrow routes and CO's strong European and South American presence, would make for a global airline powerhouse.
As I have mentioned in previous threads, I think there are some flaws in the Sky Team alliance and with Northwest's strong ties to KLM and Delta's close ties to Air France (and with AF and KL having recently joined forces), my perception is that Continental is the weakest link. Since CO has not alligned itself with a foreign carrier, and with the recent announcement of the HP-US merger, my guess is that there is going to be some reshuffling of partnerships.
I believe that a CO-UA combination, not in the form of a merger per se, but in the form of Continental re-alligning itself with UA and Star Alliance, would position both carriers strategically on the global map: United's strong presence in Asia (and Air Mike, to a lesser extent), domestic hubs in LAX, SFO, DEN, IAH, ORD, IAD, and EWR, United's Heathrow routes and CO's strong European and South American presence, would make for a global airline powerhouse.
North by Northwest
Veteran
Dream on...Why on god's green earth would Cal trade NWA for Ual? Besides...Cal is off the market till 2025. The sharks at the Rock (Red World HDQ) in MSP saw to that. "Northwest Airlines and Continental Airlines announced that they have executed definitive agreements regarding the sale to Continental of its common stock held by Northwest, and an extension of their alliance agreement through 2025. Continental will repurchase from Northwest approximately 6.7 million of its Class A shares for $450 million cash. The repurchase of a portion of Northwest's interest will occur immediately prior to a recapitalization of Continental, whereby each remaining outstanding share of Continental Class A common stock will be reclassified into 1.32 shares of Class B common stock. Northwest will retain approximately 2.6 million shares of Continental Class B common stock, which will constitute less than 5% of Continental's then outstanding common stock. The agreements also amend the alliance between the companies to extend its term through 2025.JAMAKE1 said:
WorldTraveler
Corn Field
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Delta. Marketing alliance to be announced this fall. Star Alliance to be rocked. Not to worry, though. HP has arrived.
All seriousness aside, if I could align myself with US or DL, I don't think it would take too long for me to change my reservations to visit ATL instead of DCA. It won't be a merger but an enhanced marketing alliance with revenue sharing. Unlike US, Delta actually has a presence in some of the places that compete with UA which could be dumped in favor of UA's stronger presence; likewise, UA has a presence in DL markets although they bleed money. However, there are plenty of holes in each carrier's route system that the other serves well.
All seriousness aside, if I could align myself with US or DL, I don't think it would take too long for me to change my reservations to visit ATL instead of DCA. It won't be a merger but an enhanced marketing alliance with revenue sharing. Unlike US, Delta actually has a presence in some of the places that compete with UA which could be dumped in favor of UA's stronger presence; likewise, UA has a presence in DL markets although they bleed money. However, there are plenty of holes in each carrier's route system that the other serves well.
North by Northwest
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Delta will NEVER leave (alive) SkyTeam. Make the best of your fling with U (star).
WorldTraveler
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Who said anything about Delta leaving Skyteam? It's United that will be leaving Star. NW will acquire CO and become the anchor US tenant for Star.
BTW, all of the marketing agreements have "outs" if one carrier acquires a stake in another. Doesn't matter, though. NW will finally win CO's hand in marriage rather than the shacking up relationship they have had. NW will find AA and DL eager to buy CO's Boeings in return for (at least) DL sending the A320 family from UA to MSP/DTW. That might take a while but UA will have to wise up and realize they could gain far more from DL than they possibly could from US and DL can gain far more from UA than they every could from NW+CO. Remember, the DL+CO+NW alliance was created in response to UA+US. Now that DL has been experiencing the pleasures of a relationship, they can't possibly return to being single - esp. given the strength AA has over them in the central states. DEN is well within RJ range of serving all of the SE markets DL used to serve but which UA does not serve from DEN and which are beyond the range of an RJ from SLC.
It's DL and UA in the future. No wedding invitations are being printed but we'll be hearing rumors of midday a rendezvous or two in the near future.
BTW, all of the marketing agreements have "outs" if one carrier acquires a stake in another. Doesn't matter, though. NW will finally win CO's hand in marriage rather than the shacking up relationship they have had. NW will find AA and DL eager to buy CO's Boeings in return for (at least) DL sending the A320 family from UA to MSP/DTW. That might take a while but UA will have to wise up and realize they could gain far more from DL than they possibly could from US and DL can gain far more from UA than they every could from NW+CO. Remember, the DL+CO+NW alliance was created in response to UA+US. Now that DL has been experiencing the pleasures of a relationship, they can't possibly return to being single - esp. given the strength AA has over them in the central states. DEN is well within RJ range of serving all of the SE markets DL used to serve but which UA does not serve from DEN and which are beyond the range of an RJ from SLC.
It's DL and UA in the future. No wedding invitations are being printed but we'll be hearing rumors of midday a rendezvous or two in the near future.
ohcaptainron
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World, one thing is for sure, if UAL cannot buy the combined US airways or CAL , then DAL is the next logical combination, remember the attempted code share not that long ago. If the US Airways model is successful, that is a bankrupt company buying a non bankrupt company and then rationalising those non bankrupt assets in the BK court, DAL does make the most sense. However, the regulatory issues and outcry from everyone else in the industry would be a significant barrier.
Financing the deal would not be a barrier. As you may recall Tilton gave a keynote at the Morgan Stanley analyst meeting in March, he stated that UAL would lead the consolidation post BK, I asked him directly how could UAL fund any deal, his response was interesting, he said when UAL exits BK the restructured company would have between 5.5-6.5 billion in total debt, and that there was not only capital to exit but significant capitial to fund ANY aquisition.
I would doubt a pullout of Star, with a combined UA/DAL, and LH getting ready to do a number of deals, the results would be compelling. In that scenero one of the carve outs would be the US code share, but the combination would solve both UALs and DALs shortcomings, HUBS: JFK, IAD, ATL, ORD, SLC, DEN, LAX, SFO, NRT, LHR, I am guessing SLC, and possibly IAD would need to be downsized but what a network. with the failing company docturine in the antitrust area both companies see what might be a very rare opportunity to do a deal. We will know soon enough.
[/quote]
Financing the deal would not be a barrier. As you may recall Tilton gave a keynote at the Morgan Stanley analyst meeting in March, he stated that UAL would lead the consolidation post BK, I asked him directly how could UAL fund any deal, his response was interesting, he said when UAL exits BK the restructured company would have between 5.5-6.5 billion in total debt, and that there was not only capital to exit but significant capitial to fund ANY aquisition.
I would doubt a pullout of Star, with a combined UA/DAL, and LH getting ready to do a number of deals, the results would be compelling. In that scenero one of the carve outs would be the US code share, but the combination would solve both UALs and DALs shortcomings, HUBS: JFK, IAD, ATL, ORD, SLC, DEN, LAX, SFO, NRT, LHR, I am guessing SLC, and possibly IAD would need to be downsized but what a network. with the failing company docturine in the antitrust area both companies see what might be a very rare opportunity to do a deal. We will know soon enough.
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North by Northwest
Veteran
"As you may recall Tilton gave a keynote at the Morgan Stanley analyst meeting in March, he stated that UAL would lead the consolidation post BK(in 2025...MAYBE), I asked him directly how could UAL fund any deal, his response was interesting, he said when UAL exits BK (2050...MAYBE) the restructured company would have between 5.5-6.5 billion in total debt (they would have simply died off by then), and that there was not only capital to exit but significant capitial to fund ANY aquisition" Oh REALLY? Perhaps a few thousand retirees and Ual employees would like to have their stolen pensions REFUNDED. Don't mean to be mean...just playing devil.
JAMAKE1
Veteran
North by Northwest said:
Because Continental's One Pass elite members are rather displeased with how they are treated by Delta. Their One Pass status gets them nothing in terms of upgrade priveleges and other perks. Furthermore, NWA is in bed with KLM and Delta with Air France, and now that AF and KL are together, my sense is that NWA nor Delta, is going to sever their close working relationships with their respective foreign alliance partners.
Just because NW and CO have a contractual agreement that lasts through 2025, doesn't mean that those contracts cannot be amended. UA and its UA Express partners are a primary example of that. Contracts and allegiances are amended all the time.
The alliance with DL on the part of CO and NW was a competitive response to the UA-US codeshare. With DL and NW so closely alligned to AF and KL respectively, CO seems to now be the weakest link in the alliance.
World Traveller: I know that you have a strong loyalty to Delta which is reflected in your many postings, but UA and Lufthansa have a very strong working relationship and hence, I would highly doubt one would see UA opting out of Star.
I could be wrong, but my hunch is that the NW-DL relationship will get stronger at the expense of CO, as a result of the AF-KL merger.
North by Northwest
Veteran
The revenue exchange between NWA/Cal is far more than Dal. Northwest has first digs on the purchase of Cal. End of story. Besides...those "simpli-stupid" fares has really pissed NWA off.
JAMAKE1
Veteran
Who said anything about a purchase? I was talking about a reshuffling of alliance partners.
