Us Airways Keeps Door Open For A Better Deal

[USA320Pilot]

US Airways keeps door open for a better deal

Standard & Poor's airline analyst Jim Corridore said Monday that he wouldn't be surprised if other suitors emerged, citing the bidding war that erupted for ATA. But he doesn't see much interest from other carriers in a deal the scope of America West's.

"I don't think there's anyone out there that needs US Airways the way America West does," he said, citing their complementary route networks.

In its court filing, US Airways said the deal with America West is the best it has found in more than five years of searching. This is the company's second trip through bankruptcy court in three years.

"After flirting on the edge of financial disaster for many months," the filing said, the company is proud of the deal because it will preserve jobs and offer the best payback to creditors and other parties.

Regards,

USA320Pilot

 

[awayfrmitall]

Ok... I don't see where it says that US is keeping any doors open for a better deal. I do see where it says this is the best deal if 5 years so I have my doubts that some other "better deal" is around any corner.

 

[USA320Pilot]

Then if there is not a better deal around the corner within 30 days then this deal will proceed.

Regards,

USA320Pilot

 

[TheLarkAscending]

Ok... I don't see where it says that US is keeping any doors open for a better deal. I do see where it says this is the best deal if 5 years so I have my doubts that some other "better deal" is around any corner.

Perhaps if the link had been provided, you'd have been able to read the entire article from The Arizona Republic here

 

[hharotz]

Then if there is not a better deal around the corner within 30 days then this deal will proceed.

Regards,

USA320Pilot

[post="272771"][/post]​

At this point, does UA still have any interest at a merger with US? Are they now in a position to place a bid on US or are they totally out of the picture as a potential purchaser of US?

 

[aafsc]

At this point, does UA still have any interest at a merger with US? Are they now in a position to place a bid on US or are they totally out of the picture as a potential purchaser of US?

[post="272821"][/post]​

They are still in bankruptcy court and have to get 2 contracts ratified and file a plan of reorganization and get exit financing.

 

[USA320Pilot]

Hharotz:

There is reason to believe UA would still like to merge with US, but the company or third party investors are required by law to submit a bid for US in 30 days.

With UA still working its way through the S.1113 process and still in bankrputcy it might be too difficult to submit an alternate offer. Obviously, UA cannot do it and it would take more than $1.6 billion in aditional liquidity to beat the offer by the parties "boosting up" the knew holding company.

UA is going to be hurt by this deal with the loss of code share revenue and Air Canada moving away from UA and towards US and it appears there may not be much UA can do with US at this point.

Regards,

USA320Pilot

 

[hp_fa]

Obviously, UA cannot do it and it would take more than $1.6 billion in aditional liquidity to beat the offer by the parties "boosting up" the news holding company.

[post="272839"][/post]​

No, it won't. What it will take is an offer that puts more money in the hands of the unsecured creditors. If UA, WN or any other company can put more money in the hands of the unsecured creditors and they vote to accept that deal, then that is what the judge will accept.

I don't have the details on what the HP/U deal provides to the unsecured creditors, but that is what is going to make a difference. Not what you want, I want or what anyone else might want.

 

[whlinder]

UA is going to be hurt by this deal with the loss of code share revenue and Air Canada moving away from UA and towards US and it appears there may not be much UA can do with US at this point.

[post="272839"][/post]​

Well, they could kick US out of Star if they wanted to.

 

[robbedagain]

Well, they could US out of Star if they wanted to.

[post="272855"][/post]​

how could they do that especially if Air Canada is going to get good busniness? cant AMW actually become Star Alliance member which then would heklp to get the merger thru

 

[USA320Pilot]

hp_fa:

You said the same thing I did. If another business enterprise puts together a better offer than US Airways negotiated, then yes, they could take control of the Arlington-based company.

Regards,

USA320Pilot

 

[USA320Pilot]

MEC CODE-A-PHONE UPDATE - May 24, 2005

This is Jack Stephan with a US Airways MEC update for Tuesday, May 24th, with two new items.

Item 1. On May 20, US Airways filed a motion with the Bankruptcy Court seeking approval of procedures for other entities to submit competing plans of reorganization funding proposals. Those entities who wish to file competing proposals must satisfy certain requirements, including a $25 million deposit at the time of submission of its proposal. Proposals must be made within 30 days after the court approves the procedures.

If no competing proposals satisfying the requirements are made, US Airways will seek confirmation of a plan implementing the Merger Agreement between US Airways and America West, and the Investment Agreements with the plan investors.

If a competing bid is ultimately approved by the bankruptcy court, under certain circumstances, US Airways would have to pay America West $15 million for withdrawing from the merger. If America West withdraws its offer, under certain circumstances, it would have to pay US Airways $15 million. In addition, if a competing bid is approved by the court, under certain circumstances, US Airways may be required to pay certain merger investors breakup fees totaling as much as $6.75 million.

Regards,

USA320Pilot

 

[whlinder]

how could they do that especially if Air Canada is going to get good busniness? cant AMW actually become Star Alliance member which then would heklp to get the merger thru

[post="272857"][/post]​

Because it isn't up to AC. Star has some sort of rule where the first airline in the alliance from their home country has an awful lot of power over the actions of any additional airlines that become members from that country.

This is from the merger FAQs:

How will this transaction affect current code-shares for AWA and US Airways?
US Airways is currently a Star Alliance member, including reciprocal frequent flyer programs with 15 airlines around the world. Their continued participation in the Star Alliance is dependent upon its domestic code-share relationship with United Airlines. The proposed merger would need to be approved by United as a modification to the terms of the United/US Airways code-share agreement for the purpose of being a member of the Star Alliance. At this time no discussions regarding the code-share agreement with United Airlines have taken place.

Even though A320 has wet dreams about US ditching UA and taking over all their hubs and planes and ruling the world, and even though AC bought themselves better gates and a huge maintenance contract, the fact is US is UA's b*tch when it comes to the Star Alliance, as long as UA is in business.

 

[USA320Pilot]

Whlinder, I have "no dreams" about United or anybody else. I simply report information to the best of my knowledge. Furthermore, it's my understanding US Airways will remain in the Star Alliance and keep the domestic code share agreement in place.

Per the merger Q&A on US Airways' internal website called theHub:

Q. Will the merged airlines participate in the Star Alliance and the codeshare agreement with United Airlines?

A. The merger envisions continued participation in the Star Alliance and code sharing with United Airlines. Now that the merger agreement is complete and announced, we can begin discussions with Star Alliance carriers and United to address the issues.

Regards,

USA320Pilot

 

[whlinder]

I do not agree with Boyd much of the time, but I can see how the United merger would end because of antitrust issues, the expanded North American network, and the ability to keep revenue "in-houe". The combined US Airways – America West will fly to almost every current US Airways-United city and it would be better for the merged company to keep the passengers on its own aircraft. In addition, there is going to be much stronger ties with Air Canada, another Star Alliance carrier.

Meawnhile, from an international perspective the new US Airways can book on other international carriers and keep its global network reach intact, whether or not the Arlington-based company code shares with United.

I believe Boyd is right on this subject and by “shunningâ€￾ United again US Airways could end up with keeping United's portion of the code share revenue of up to $250 to $300 million when the merger integration is complete.

[post="272501"][/post]​

UA is going to be hurt by this deal with the loss of code share revenue and Air Canada moving away from UA and towards US and it appears there may not be much UA can do with US at this point.

[post="272839"][/post]​

I simply report information to the best of my knowledge. Furthermore, it's my understanding US Airways will remain in the Star Alliance and keep the domestic code share agreement in place.

So now you have contacts at UA who have led you to conclude in your 'understanding' that UA will not be kicking US to the curb and out of Star?

I'll let you tell me how you are now 'understanding' that US will stay in Star when earlier today you were telling us about how the codeshare would end by US "shunning" UA.

Per the merger Q&A on US Airways' internal website called theHub:

Q. Will the merged airlines participate in the Star Alliance and the codeshare agreement with United Airlines?

A. The merger envisions continued participation in the Star Alliance and code sharing with United Airlines. Now that the merger agreement is complete and announced, we can begin discussions with Star Alliance carriers and United to address the issues.

[post="272880"][/post]​

Ooooh the Hub, you're fancy. That same question and answer is contained in the page I linked earlier.

Please make up your mind. Do you think US will continue to codeshare with UA, and thus stay in Star, or not?

Oh and btw, since we are all talking hypothetically (assuming US and HP actually merge), you should probably be referring to US as the Tempe-based company.