US Airways Buying UA or CO

[Pragmatic]

Oh please don’t happen:

Even a Delta-Northwest curtain-raiser could draw competing offers — some analysts think American's parent, AMR Corp., might bid for Northwest. There is speculation that US Airways Group Inc. could bid for Continental or United, although it might need a partner who can bring cash to the table.


http://www.chron.com/disp/story.mpl/ap/business/5527554.html

 

[OldGuyinPA]

God help us...

Doug isn't capable of this venture.

He's proven that.

 

[Art at ISP]

It's a rumour nothing more. US couldn't even buy glassware for the East fleet, let alone another airline.

And CO will not be bought by anyone, ESPECIALLY US. They have an excellent management team and for the most part happy employees--therefore they are constantly profitable and still offer the best service of any domestic airline.

Keep dreaming--US will either be bought, split up or remain as is.

They do not have the money to be the buyer, and no one in their right mind would partner with them.

 

[FrugalFlyerv2.0]

It's a rumour nothing more. US couldn't even buy glassware for the East fleet, let alone another airline.

And CO will not be bought by anyone, ESPECIALLY US. They have an excellent management team and for the most part happy employees--therefore they are constantly profitable and still offer the best service of any domestic airline.

Keep dreaming--US will either be bought, split up or remain as is.

They do not have the money to be the buyer, and no one in their right mind would partner with them.

While it is logical to think that US will not do any buying themselves, I sort of think that if there is going to be consolidation, US may be involved - along with UA and AC (not CO). IMHO, it would make sense for these 3 North American * alliance carriers to somehow hook up / integrate. Ofcourse there are foreign ownership rules for airlines in USA and Canada, but what about UA, AC, US and corporations like Onex and/or pension funds & private equity companies forming a new holding company for the aforementioned airlines. This would make sense, especially if DL and NW hook up and become the north American version of AF-KL.

Check out this story from the Great White North: "ACE, which owns 75 per cent of Air Canada, has been looking for ways to cash out its stake in the Montreal-based airline. It had hoped to wind up it operations by the second quarter of 2008 by offloading its remaining stakes in Aeroplan Income Fund (TSX: AER.UN), Jazz Income Fund (TSX: JAZ.UN), service company ACTS and Air Canada (TSX: AC.A)."

Also check out this article: "... ... ... Milton says he is considering the sale of Canada's largest airline to private equity or pension fund investors that, in turn, may want to link up Air Canada with a major U.S. carrier in a deal that could involve a significant degree of foreign ownership."

 

[mike33]

It's a rumour nothing more. US couldn't even buy glassware for the East fleet, let alone another airline.

And CO will not be bought by anyone, ESPECIALLY US. They have an excellent management team and for the most part happy employees--therefore they are constantly profitable and still offer the best service of any domestic airline.

Keep dreaming--US will either be bought, split up or remain as is.

They do not have the money to be the buyer, and no one in their right mind would partner with them.

Lets not fool ourselves....US had put together a deal worth about $10 billion for DL. When it gets to this stage of the game, the money comes pouring in from the most unlikely places.

 

[Elevation]

It's a rumour nothing more. US couldn't even buy glassware for the East fleet, let alone another airline.

And CO will not be bought by anyone, ESPECIALLY US. They have an excellent management team and for the most part happy employees--therefore they are constantly profitable and still offer the best service of any domestic airline.

Keep dreaming--US will either be bought, split up or remain as is.

They do not have the money to be the buyer, and no one in their right mind would partner with them.

Its not about who runs the best airline, fleet commonality or happy employees, it's about making money. If there is a lot of money to be made for the shareholders Doug will be there.

 

[BoeingBoy]

Lets not fool ourselves....US had put together a deal worth about $10 billion for DL.

Except that same deal would only be worth about $5.7 billion today - $5 billion in cash and $700 million in stock. When US upped the offer for DL, the increase was all in stock - apparently there wasn't more cash available making further dilution of existing shares the only option.

Would that be enough to buy another legacy carrier? UA has an enterprise value of $10.8 billion - that's the theoretical cost of buying them. DL's enterprise value is $13.4 billion, NW's is $8.9 billion, AA's $10.52 billion. Only CO's, at $5.0 billion, is in the range of what the previous DL offer is worth today. Just for comparison, US' enterprise value today is $2.4 billion - about half of what it was when the DL offer was made.

Jim

 

[767jetz]

Ahhhhh yes... US buys it's way into the big leagues and finally dominates the industry as they are destined to!

... The fantasy that never dies.

 

[bam-bam]

the longer i live
the more i find out
big business and women
i know little about
:unsure:

 

[phlus2]

Lets not fool ourselves....US had put together a deal worth about $10 billion for DL. When it gets to this stage of the game, the money comes pouring in from the most unlikely places.

Yes but - since that time this management has proven that they can't even figure out how to put a beverage cart together for inflight service that is actually usable - so would you give them $10 billion or more to go out and make another purchase?

Since more time has passed Doug and crew have only proven that they really don't have any idea of how to merge two operating airlines into one and that all of the "synergy" stuff was pie in the sky wishes that they really had no idea how to make happen once the deal closed.

Can you really imagine US Mgt. running something as big as a merged US / UA - that would be just too funny to watch. They can't get it together for what they have now - how in the world would they ever make a go of something that big?

I would predict that they would not be able to raise enough cash to do any merger since they certainly have proven over time that they couldn't make the first one work.

 

[EMBFA]

Its not about who runs the best airline, fleet commonality or happy employees, it's about making money. If there is a lot of money to be made for the shareholders Doug will be there.

I agree. These things don't depend on our little world. Much as I think they are a joke, they banged two pieces of sh*t together and turned it into money, and they pretty much still are. I'm not sure the Delta debacle worked against him, in fact, it only went to show his ability to put together money to pull off such a deal.

I'm just ready for it to get going, see who does what, and see where the pieces lay. I know I'm not alone in that the results of this stuff determines whether I stay or go- if US Airways stays alone, look for a mass exodus of us "bottom feeders"- there'll be no point anymore.

 

[back2CLT]

Ahhhhh yes... US buys it's way into the big leagues and finally dominates the industry as they are destined to!

... The fantasy that never dies.

I bet you double park your sweet "Stang" in the employee lot.....

 

[EMBFA]

I guess our US Airways board is "the big leagues" of USAviation as everyone is here.

 

[flyinawa]

Yes but - since that time this management has proven that they can't even figure out how to put a beverage cart together for inflight service that is actually usable - so would you give them $10 billion or more to go out and make another purchase?

While I could be wrong, I don't think our CEO sits in his office with various beverage cart items on a table and tries to come up with a better way to load them on a beverage cart. Furthermore, I'm pretty sure Wall Street is a lot less concerned with your beverage cart than it is with making money. But hey, I'm not a management guy...what do I know.

FWIW, IMO we have enough mess here without adding a new player.*

*Note: The opinions of this employee are not necessarily representative of the management of USAirways or it's subsidiaries.

 

[sharktooth]

Its not about who runs the best airline, fleet commonality or happy employees, it's about making money. If there is a lot of money to be made for the shareholders Doug will be there.

You are really good a repeating "talking points", apparently without thinking what they may mean. Entities that hold stock, unless they own a large block (multiple of 10%), are basic bit players and tend to get lost in the scenery.

It would be far better to say, stakeholders, which includes all the venders that are interested in favorable outcomes, GE Cap. is a major player, as well as all the other entities that play a role, politicians come to mind. I know the mythology that we are immersed in about the "individual stockholder" and how management is "accountable", but it seems a case of theory vs practice and so far, practice is the reality.