From the DAL ALPA Chairman:
January 11, 2007
Dear Fellow Pilot,
As merger news and rumors continue to circulate, I want to take this opportunity to provide you with an update on activities surrounding the US Airways' hostile takeover attempt. On November 21, 2006, I wrote:
"I want to assure you that your union is reviewing this hostile takeover attempt in terms of what it could mean to the long-term best interests of the Delta pilots . . . Should this merger be as misguided and as poor an idea as I currently believe it to be, then I will deploy every available resource to stop it."
In very short order, it became abundantly clear that the proposed merger was flawed in many aspects and, overall, a bad idea-bad for our passengers, bad for the communities we serve, and bad for employees. Further, Parker's plan is simply not credible, and with each passing day the credibility of that plan fades further. Two weeks ago, Parker definitively stated that he had no intention of increasing his offer. Yesterday, he increased his offer, while at the same time reaffirming his "plan" for no "frontline" employee furloughs. But on the same day, Parker's number two man was openly discussing additional divestitures beyond those originally disclosed to quell antitrust concerns that US Airways claims don't exist in the first place. With divestitures come job losses. Make no mistake-Parker's plan will result in thousands of job losses regardless of Parker's empty promises.
As most of you know by now, yesterday US Airways announced that they would increase their offer while also stating that the "offer is set to expire on Feb. 1, 2007 unless there is affirmative creditor support for commencement of due diligence . . . as well as the postponement of Delta's hearing on its Disclosure Statement scheduled for Feb. 7, 2007." The offer would increase the debt of the combined corporation by an additional one billion dollars, a move that is already drawing concern from industry analysts. Further, none of the major faults in the original plan were addressed including antitrust concerns, massive route overlap, actual job losses and, importantly, the provisions of the Delta Pilot Working Agreement (PWA).
Parker mistakenly believes that he can somehow magically overcome the scope protections built into our contract and to date refuses to discuss the contract in anything other than superficial terms. The Delta PWA is a part of Delta's Plan of Reorganization and must be a part of any such plan of reorganization. Parker, however, simply ignores the implications of our contract. For example, in response to just a single issue, he has been quoted as saying, "We don't know enough about the contract and how this clause came to be." Pilot contract issues will not go away regardless of how much money Parker throws at this merger. For example, our contract:
o Prohibits a "code-sharing" relationship between Delta and US Airways that is critical to the success of the merger plan.
o Dictates that, in the event of a merger, our contract is the controlling document and all provisions remain in force, provisions which prevent many planned US Airways synergies.
o Provides that the amount of Delta flying cannot decrease during a merger transition period until full operational integration, a period that would take years.
o States that Delta pilots must fly any aircraft configured for over 76 seats. US Airways would be prohibited from operating an entire portion of their fleet of aircraft as a result of this provision.
o Most importantly, the Delta pilot contract is binding on any successor or affiliate, including a transaction where Delta is bought by another carrier or holding company subject to the provisions of Letter of Agreement 7, Bankruptcy Protection Covenant.
The Delta pilots will not change any provision of our contract in order to facilitate the hostile takeover of our company.
I want to caution you about the many press reports you will read and see in the coming days and weeks regarding both the US Airways' hostile merger attempt and any other industry merger activity. I want to make this perfectly clear. Delta remains committed to emerging from bankruptcy as a stand alone airline, and the Delta MEC shares that commitment. Nothing will distract us from the task at hand.
Parker's hostile takeover attempt represents a clear and present danger to the careers of all Delta employees. As such, the MEC remains totally committed and one hundred percent focused on one thing-the death of the US Airways' merger attempt. To that end, at this week's MEC meeting in Washington D.C. , the MEC unanimously passed a resolution committing $15 million dollars to the effort to ensure that Parker fails. Additionally, for the next several weeks, a substantial portion of all MEC operations will shift to Washington as we concentrate our efforts on Capitol Hill and the financial markets. Parker will soon come to realize that we cannot be ignored, that we are not going away, and that the Delta pilots will not be "synergized."
Fraternally,
Lee Moak, Chairman
Delta MEC
January 11, 2007
Dear Fellow Pilot,
As merger news and rumors continue to circulate, I want to take this opportunity to provide you with an update on activities surrounding the US Airways' hostile takeover attempt. On November 21, 2006, I wrote:
"I want to assure you that your union is reviewing this hostile takeover attempt in terms of what it could mean to the long-term best interests of the Delta pilots . . . Should this merger be as misguided and as poor an idea as I currently believe it to be, then I will deploy every available resource to stop it."
In very short order, it became abundantly clear that the proposed merger was flawed in many aspects and, overall, a bad idea-bad for our passengers, bad for the communities we serve, and bad for employees. Further, Parker's plan is simply not credible, and with each passing day the credibility of that plan fades further. Two weeks ago, Parker definitively stated that he had no intention of increasing his offer. Yesterday, he increased his offer, while at the same time reaffirming his "plan" for no "frontline" employee furloughs. But on the same day, Parker's number two man was openly discussing additional divestitures beyond those originally disclosed to quell antitrust concerns that US Airways claims don't exist in the first place. With divestitures come job losses. Make no mistake-Parker's plan will result in thousands of job losses regardless of Parker's empty promises.
As most of you know by now, yesterday US Airways announced that they would increase their offer while also stating that the "offer is set to expire on Feb. 1, 2007 unless there is affirmative creditor support for commencement of due diligence . . . as well as the postponement of Delta's hearing on its Disclosure Statement scheduled for Feb. 7, 2007." The offer would increase the debt of the combined corporation by an additional one billion dollars, a move that is already drawing concern from industry analysts. Further, none of the major faults in the original plan were addressed including antitrust concerns, massive route overlap, actual job losses and, importantly, the provisions of the Delta Pilot Working Agreement (PWA).
Parker mistakenly believes that he can somehow magically overcome the scope protections built into our contract and to date refuses to discuss the contract in anything other than superficial terms. The Delta PWA is a part of Delta's Plan of Reorganization and must be a part of any such plan of reorganization. Parker, however, simply ignores the implications of our contract. For example, in response to just a single issue, he has been quoted as saying, "We don't know enough about the contract and how this clause came to be." Pilot contract issues will not go away regardless of how much money Parker throws at this merger. For example, our contract:
o Prohibits a "code-sharing" relationship between Delta and US Airways that is critical to the success of the merger plan.
o Dictates that, in the event of a merger, our contract is the controlling document and all provisions remain in force, provisions which prevent many planned US Airways synergies.
o Provides that the amount of Delta flying cannot decrease during a merger transition period until full operational integration, a period that would take years.
o States that Delta pilots must fly any aircraft configured for over 76 seats. US Airways would be prohibited from operating an entire portion of their fleet of aircraft as a result of this provision.
o Most importantly, the Delta pilot contract is binding on any successor or affiliate, including a transaction where Delta is bought by another carrier or holding company subject to the provisions of Letter of Agreement 7, Bankruptcy Protection Covenant.
The Delta pilots will not change any provision of our contract in order to facilitate the hostile takeover of our company.
I want to caution you about the many press reports you will read and see in the coming days and weeks regarding both the US Airways' hostile merger attempt and any other industry merger activity. I want to make this perfectly clear. Delta remains committed to emerging from bankruptcy as a stand alone airline, and the Delta MEC shares that commitment. Nothing will distract us from the task at hand.
Parker's hostile takeover attempt represents a clear and present danger to the careers of all Delta employees. As such, the MEC remains totally committed and one hundred percent focused on one thing-the death of the US Airways' merger attempt. To that end, at this week's MEC meeting in Washington D.C. , the MEC unanimously passed a resolution committing $15 million dollars to the effort to ensure that Parker fails. Additionally, for the next several weeks, a substantial portion of all MEC operations will shift to Washington as we concentrate our efforts on Capitol Hill and the financial markets. Parker will soon come to realize that we cannot be ignored, that we are not going away, and that the Delta pilots will not be "synergized."
Fraternally,
Lee Moak, Chairman
Delta MEC
