US Airways considering paying more $$$ for Delta...

[delta777]

http://www.marketwatch.com/News/Story/Stor...amp;siteid=yhoo

Does this mean the creditors have told Dougie he's coming up a little short?

I also find it interesting that Dougie has no problem finding another billion or so for Delta, yet the company has been dragging their feet on contract negotiations with their various unions.

 

[N628AU]

http://www.marketwatch.com/News/Story/Stor...amp;siteid=yhoo

Does this mean the creditors have told Dougie he's coming up a little short?

I also find it interesting that Dougie has no problem finding another billion or so for Delta, yet the company has been dragging their feet on contract negotiations with their various unions.

I find it interesting that Delta can increase what it feels it's own worth is and be the operational disaster it is simultaneously.

 

[Diamondbacks2004]

Drop Delta Airlines then Buy Northwest Airlines!

 

[luv2fly]

http://www.marketwatch.com/News/Story/Stor...amp;siteid=yhoo

Does this mean the creditors have told Dougie he's coming up a little short?

If you call a few billion dollars "a little short", .... yep. Doug can't afford to solve his labor issues, but he can afford to shell out another couple billion?
If DL's plan is quantified, Doug is going to have to leverage US quite a bit in order for this deal to proceed. According to this article it already stands at 22 billion in debt as proposed.

 

[autofixer]

I think DP needs to come up with a little cash to pay his employees a little better. If he can service a $8,000,000,000 debt, he can pay pre-911 wages! Anything else is unacceptable!

 

[hulagirl]

Drop Delta Airlines then Buy Northwest Airlines!

Be careful what you wish for: with the paranoia around PHX concerning seniority, you better think about the ex-Republic people who live in the PHX area...there are hundreds of NWA people commuting out of PHX, and it would have a tremendous effect on seniority if a NWA merger would occur. Trust me on this...

 

[pit_needs_help]

Drop Delta Airlines then Buy Northwest Airlines!

Does the 22 billion assume Parker's plan or guess as to how much debt there would be at the end? I, of course, haven't seen any plan but would assume the debt issue will be addressed during the extended bankruptcy time required. This would be extended maybe for months.

 

[BoeingBoy]

Does the 22 billion assume Parker's plan or guess as to how much debt there would be at the end?

It comes straight from Parker's merger proposal powerpoint presentation - $22.1 Billion.

Presentation (slide 21)

Jim

 

[pit_needs_help]

It comes straight from Parker's merger proposal powerpoint presentation - $22.1 Billion.

Presentation (slide 21)

Jim

Ok I did see that chart and forgot about it during the presentation. There seems to be large disconnect or discrepency between the debt load Delta proposes and Parker's. Even assuming the additional four billion borrowed Delta is nearly eight billion less in proposed debt or I am missing something? Of course I am probably missing the debt Usairways is carrying?

 

[RowUnderDCA]

Ok I did see that chart and forgot about it during the presentation. There seems to be large disconnect or discrepency between the debt load Delta proposes and Parker's. Even assuming the additional four billion borrowed Delta is nearly eight billion less in proposed debt or I am missing something? Of course I am probably missing the debt Usairways is carrying?

Right.. Parker's proposal is the debt on the capital of the compbined carrier DL+LCC.

What I'm curios to find out is exactly 'how' DL is proposing to meet its valuation. Is it going to looking under a profit rock that all airlines have neglected to look under and serve for great return more markets with relatively less debt obligations? or is it going to serve fewer markets with a greater ROI with less debt obligations? I bet Parker is betting that DAL's plan will have to be the latter: in order for DAL to ensure that it's proposal creates more value it is more likely to be smaller, than would have been the case had no carrier put a bid in.

 

[phasersonstun2]

I love it. Delta says they are now worth 12 BILLION DOLLARS!(Dr. Evil finger-to-mouth).

Guess what... I have a twenty five year old car that I think is worth twenty grand. The problem is that the blue book doesn't even list it.

Delta is worth what the market(U,UAL,AMR,CAL,etc.) says it is, and that's it.

 

[longing4piedmont]

http://www.marketwatch.com/News/Story/Stor...amp;siteid=yhoo

Does this mean the creditors have told Dougie he's coming up a little short?

No, he just likes salt.....and he is going to need to pound some more to choke down that BIG bowl of crow.

 

[FW190]

I love it. Delta says they are now worth 12 BILLION DOLLARS!(Dr. Evil finger-to-mouth).

Guess what... I have a twenty five year old car that I think is worth twenty grand. The problem is that the blue book doesn't even list it.

Delta is worth what the market(U,UAL,AMR,CAL,etc.) says it is, and that's it.

I'm curious to see how Delta comes up with a $10-$12 billion valuation as well. Compared with where the market is currently valuing the airlines, it's very hard to see how Delta can realistically come up with that number. However, perhaps the airline industry is just significantly undervalued as a whole by the market given the profit recovery that appears to be at hand.

 

[delta777]

Delta's bonds traded at around 67 cents on the dollar on Friday, traders said. With a claims pool estimated to be between $14 billion and $16 billion, current bond prices imply a valuation for the No. 3 U.S. carrier of $9.4 billion to $10.7 billion.

Assuming you go with the higher number, it looks like US Airways will need to come up with at least $1.5 billion more to make it legitimate.

 

[brokenwrench]

http://www.usairways.com/awa/content/opera...er/default.aspx

US Airways has announced a proposal to merge with Delta Air Lines. The transaction is valued at approximately $8.0 billion in cash and stock

http://ntl.bts.gov/lib/11000/11300/11324/01212.pdf

United would acquire US Airways in a transaction valued at $11.6 billion.