Delta creditors hard for US Air to corral-adviser

[BoeingBoy]

NEW YORK, Jan 16 (Reuters) - US Airways Group Inc. (LCC.N: Quote, Profile , Research) still has a tall order to convince Delta Air Lines Inc. (DALRQ.PK: Quote, Profile , Research) creditors to accept its takeover offer, despite raising the bid by about 20 percent last week, industry veteran Gordon Bethune said on Tuesday.

Article

Jim

 

[ClueByFour]

A few choice quotes from Gordo:

"They're not all lined up on what's good for each other,"

That's in reference to the creditors. But here is one that's really telling. From the article:

"I can still be a proponent of marriage without agreeing that these two people have to get married," he said.

That's in regard to industry consolidation. Clock is ticking.

tick. tick. tick.

 

[FlyUs]

If I had to guess, Bethune is not a proponent of this merger. He's already mentioned that it is best to merge with a carrier with different regional strengths... as a lot of us have been saying along. Maybe it's time to put this thing to bed.

 

[Informed1]

If I had to guess, Bethune is not a proponent of this merger. He's already mentioned that it is best to merge with a carrier with different regional strengths... as a lot of us have been saying along. Maybe it's time to put this thing to bed.

I whole heartedly believe we better merge with someone or we will be right back in the same situation of not being able to compete. The merger with HP is just a band-aid on a big wound. Of course, if we could ever get a management team with the goal of growing the company as it stands, we might have a chance. I don't know a lot about running an airline but the entire Latin American market has been left untapped by US. That would be a great start for growth. But, something tells me the current guys are no different in that respect than Wolfe and Gangwal were.

 

[gaucho99]

I whole heartedly believe we better merge with someone or we will be right back in the same situation of not being able to compete. The merger with HP is just a band-aid on a big wound. Of course, if we could ever get a management team with the goal of growing the company as it stands, we might have a chance. I don't know a lot about running an airline but the entire Latin American market has been left untapped by US. That would be a great start for growth. But, something tells me the current guys are no different in that respect than Wolfe and Gangwal were.

I agree. Other carriers are cleaning up in South America. Flights to Buenos Aires are full all the time.

 

[PA18]

NEW YORK, Jan 16 (Reuters) - US Airways Group Inc. (LCC.N: Quote, Profile , Research) still has a tall order to convince Delta Air Lines Inc. (DALRQ.PK: Quote, Profile , Research) creditors to accept its takeover offer, despite raising the bid by about 20 percent last week, industry veteran Gordon Bethune said on Tuesday.

Article

Jim

Hey Jim,

How come you posted this instead of you-know-who, who seems to post every other article from the media about the merger?

BTW, what do you want to bet that Doogie somehow slithers out of that "hard and fast", take-it-or-leave-it Feb. 1 deadline?

That worked every time with the US East pilots; but now he's up against a real opponent.

 

[Non Rev]

Lets say DL does not open up their books for due diligence. Could there possibly be a lawsuit by creditors or US for not allowing it? It would seem to me that all options should be explored. Not that I am a proponent of the merge but just trying to guess what the next chapter will be.

 

[longing4piedmont]

Lets say DL does not open up their books for due diligence. Could there possibly be a lawsuit by creditors or US for not allowing it? It would seem to me that all options should be explored. Not that I am a proponent of the merge but just trying to guess what the next chapter will be.

No. For two reasons.

One if they don't open the books it will be because the official committee chose not to.

Two. That is the reason they hired Bethune. He can and will offer an expert opinion thus making the chance of a lawsuit slim and none.

 

[flyhigh]

Informed & Gaucho,

With three strong carriers (AA/CO/DL) already in Latin America, there's limited opportunity there. With AA/UA/CO/DL having strong Trans-Atlantic systems already, there's limited opportunity there. The best way to get in is to buy the competitor. I asked this in another thread and will ask again...why was it okay for Exxon to buy Mobil but not US the same with DL???

 

[BoeingBoy]

why was it okay for Exxon to buy Mobil but not US the same with DL???

Bringing it down to the microeconomic level, after Exxon bought Mobile was Exxon the only gasoline available within a reasonable drive of your home?

Jim

 

[Itestwell]

Bringing it down to the microeconomic level, after Exxon bought Mobile was Exxon the only gasoline available within a reasonable drive of your home?

Jim

Probably if you live in some of those places we fly to in WV, you may not have many gas choices!

 

[usair_begins_with_u]

Finance guys can't run an airline, run away. Just run away.

 

[FWAAA]

Bringing it down to the microeconomic level, after Exxon bought Mobile was Exxon the only gasoline available within a reasonable drive of your home?

Good points.

Assuming that DL and US share many duopoly destinations (those served solely by DL and US), isn't it reasonable to think that a merger would cause USDL to trim its combined capacity (in an attempt to drive up yield), thus providing an opening for another airline to initiate service, driving down the yield to approx pre-merger levels? So instead of US and DL, those cities would be served by USDL and one of UAX, AX, COEX, etc?

In the one-horse towns (served by only one airline, DL or US), they're already paying thru the nose. Can't get any worse for Springfield (served now solely by DL) that Shelbyville (served now solely by US) and Springfield will now be served by the same airline: USDL. Name on the ground equipment may change - but single-carrier towns tend to pay high fares no matter what (unless WN is printed on the stuff). And if the combined USDL decides to axe a bunch of those podunkvilles, won't someone else apply for the EAS grants and serve them instead?

 

[BoeingBoy]

To take your 2nd point first, yes - there'll always be monopoly markets, either EAS or because the local politicians are willing to offer incentives for service that otherwise wouldn't exist.

For the first point, consider the location of hubs. For traffic within the southeast, for example, who could offer competitive service from FAY to MSY, ILM to JAX, AVL to MCO, CRW to SAV, even RDU to TLH? Any other carrier would necessitate a connection at MIA, IAD, EWR, IAH, DFW, or at best MEM. Or another carrier would have to create a hub in the southeast.

Jim

 

[BuffaloJoe]

Or another carrier would have to create a hub in the southeast.

Jim

That's where Charlotte comes in, they'll be the sacrifical lamb. Give up the gates there and WN/FL will jump at that in a flash.

Which Shuttle gets sold off?