Dulles In The Picture?

[USA320Pilot]

Yesterday US Airways executive vice president of human resources Jerry Glass addressed the LGA employees and disputed Helane Beckers comments to USA Today. US Airways does have a requirement to maintain $1 billion in unrestricted cash to maintain the ATSB covenants and Glass said this would occur. He also said the airline would not re-enter bankruptcy.

I believe its important to note Becker has been removed from her position at two brokerage firms and most recently was let go from Buckingham Research. Becker has recently been employed at Benchmark Co., which is a minor firm in regard to airline analysis.

Separately, I understand Dave Siegel, Bruce Ashby, Neal Cohen, and Ben Baldanza have spent a lot of time in Chicago recently and it appears a UCT and/or ICT derivative is being negotiated.

Also noteworthy, two additional analysts have told me that there are deepening discussions occurring between the parties and United is searching for a way to emerge from bankruptcy. At this point it appears the only way United can emerge is through an asset sale and apparently the terms are being negotiated.

Interestingly, it appears Dulles and ACA are now a US Airways target. If you remember, Greg Taylor told the bankruptcy court the unsecured creditors committee wants the company to divest of this hub and shortly after ACA made it known the Dulles-based company would part ways with United.

In addition, in an interview with the Washington Times, Siegel previously said he was interested in acquiring Dulles from United.

At the time I was surprised at Siegel’s comments, but it now appears US Airways wants MIA as well and may focus its international expansion on Philadelphia, Dulles, and Miami, to leverage its east coast presence.

In fact, yesterday Glass confirmed Siegel’s comments in Air Transport World that US Airways intends to fly to 20 European cities alone out of Philadelphia. However, let’s get back to Dulles.

Today’s news regarding United, ACA, Mesa, and Dulles is interesting. Reports indicate Siegel was concerned by ACA’s plan to become an independent airline and the surrogate hit man to ensure US Airways would have a turn key Dulles feed operation is Jonathan Ornstein and Mesa. One of the union problems with a United/US Airways transaction for Dulles is feed and the ALPA J4J restrictions. US Airways is prohibited for code sharing with ACA unless its J4J, however, if Mesa acquires ACA, then US Airways could acquire United Dulles assets and bypass J4J contract violations.

Regardless, there is a lot unfolding here and it appears we will know more very shortly regarding United’s final disposition. The company is scheduled to release its Q3 results next Friday, it must file its monthly financials with the court, and the next Omnibus hearing is on the agenda.

After Glass’ meeting yesterday, I more optimistic about US Airways as a surviving independent business entity and I appreciate your concern,

Regards,

Chip

 

[T-bone]

While I wish no harm to UA, I hope your specualations come to pass

 

[Phantom Fixer]

One of many flies in this ointment is this. ACA wants no part of dealing with Johnny O. ....or at least that's what they are saying publically.

Should Mr. I'm in need of self-validation become sucessfull at a hostile takeover of ACA?...what's to stop him from making his next move on U in the same manner?


Having read the story about J.O. ...and his complex and need to become a big player in the world , I wouldn't put anything past this man.

I would also be very very leary of J.O. getting any thicker with U as it stands.


Keep in mind...J.O. already lost a pile of money on U during our BK....I believe his intent was to buy his way on to our BOD or maybe more?

Bottom line.....I hope we (UA and US ) can work ourselves out of the dullldrums we are in...yet I fear anything that further includes Mr. Mesa man.

He will be looking for payback with a vengence.....think I'm kidding? Ask any former CCAir person what J.O.'s involvement did for them in rather short order.

 

[Rob]

Of interest, ACA Board and Officers own very little stock - something under 6%. JayOh's selling job has to be to the institutional holders of ACA, who may be less eager than the board and officers to try going it alone.

 

[Fly]

Interested in acquiring Dulles?!? What are they planning on using for money?

Here's a tip .... when trying to persuade about another's demise, you may try to choose a day that your collegue hasn't posted such damaging pictures.

I wonder what the general public would think if someone where to mail copies of these "interior" cabin pictures to the media?

I'm leaving today (I know, I'll miss you too) but will return with some interior pictures of our cabin next week. Then lets play: Show and Tell!

 

[ITRADE]

Of interest, ACA Board and Officers own very little stock - something under 6%. JayOh's selling job has to be to the institutional holders of ACA, who may be less eager than the board and officers to try going it alone.

Agreed. The institutionals seem very interested in a sell out.

 

[allegheny1]

Here we go again!

I too would like to see some expansion and a more positive tone but the
situation (transaction) that chip outlines looks and feels like a disaster waiting
to happen.

How can anyone justify such a thing when arbitration as well as court time
has become a way of life at u between management and ALL of labor. Zero
trust, zero morale,zero cooperation.

Secondly, did you forget the PSA and Piedmont mergers. Both were severely
botched by management that had alot more operational acumen then the
current management team...which has ZERO.

Thirdly, what about the regulatory problems,which may be minor, or the
union integration problems,which may be major.

Please...no transaction. Fences need to be mended,time needs to pass, a
profit needs to be made....etc...etc.

regards

 

[deltawatch]

How about this one Chip. U becomes a big RJ outfit. U takes over United’s RJ systems also. At some point what little is left of our mainline gets spun off to United. The code share cont's.

 

[usairways85]

Why would US want IAD. They already have PHL, and have taken way to long to get rid of PIT and who knows if they ever will. So they'd have PHL, PIT, and IAD all in the Northeast. If that ever came to be, i would think PIT would be dropped, but why is there a need for IAD and PHL? Would US stay in PHL if they got IAD?
I still hold firm that if US cut a number of flights in PHL that Airtran would step in with force and probably steal loads of money from US at PHL.

On the other hand, i think increase MIA operations is a great idea. It's a good way to add to Star connections as well as another great gateway to the Caribbean/Latin America gateway

 

[USFlyer]

IAD = O&D!

Having PHL & IAD is much better than having PHL & PIT. But, I agree, PHL, IAD and CLT is probably overkill, so I'm not so sure what Siegel's plan is there. With regards to MIA, what is stopping US from expanding there now? UA's presence really isn't all that big at the moment anyway.

 

[atlmd80]

I would like to add a little reality to this discussion. In the first post Chip says that the ATSB loan requires 1 billion dollars of unrestricted cash. At the end of the third qtr US Airways reported a cash balance of 1.94 Billion. Of that, 1.38 Billion is unrestricted. So U has $380 million to operate and make any investments. The Washington Post reported today that ACA has turned down a $512Mil offer by Mesa. My guess is that any offer that is acceptable to the board of ACA would be greater that $512Mil. My math says U can barley afford 50% of UAL's commuter operation in IAD. Not to even talk about the whole Hub.

The important question is: At the current rate of loss, will 380 million see US Airways through 2005(The projected first profitable year)?

 

[passed_over]

Having read the above post from Chip, it still boggles the mind that U will not keep there eggs in there own basket and utilize the Wholly owned to the fullest. I am certain that the pilot groups could sit at a table and work out the details and keep the regional feed inside the group rather than keep putting it in Johnny O's basket. When are they going to wake up and utilize there greatest assetts there own employees???

 

[robbedagain]

Chip: I'm new to this board but I have read many articles from you and many others: Can you explain to me that what you're saying here is is it possible that U may be merging with UAL or its feeder ACA or what?

 

[ITRADE]

IAD = O&D!

Having PHL & IAD is much better than having PHL & PIT. But, I agree, PHL, IAD and CLT is probably overkill, so I'm not so sure what Siegel's plan is there. With regards to MIA, what is stopping US from expanding there now? UA's presence really isn't all that big at the moment anyway.

Oh nothing. Just some little barnstorming outfit called American Airlines.

 

[TheWatcher]

Chip! For the love of sanityand all that is good, stop with the dilutional posts man!!