Where is US Airways in all the merger talk?
With all the rumor talk circulating so far in 2008, where does US Airways stand? Led by CEO Doug Parker, the airline has been a staunch proponent of consolidation, though his carrier has largely been left out of most scenarios that have been the subject of public speculation recently. The Financial Times points out that Parker "was the architect of the last deal involving a U.S. legacy carrier when, in 2005, as chief executive of America West he led the deal to acquire US Airways, then in bankruptcy. He tried to buy another bankrupt rival, Delta Air Lines, last year before that company rejected Mr. Parker's unsolicited bid."
So, now, where is US Airways in the latest round of merger talk? The Times says that while he is "undeterred," Parker also "said he was a realist on US Airways' role in consolidation now that all of his peers have emerged from credit protection." Parker tells the Times that US Airways -– along with Northwest –- may be too small to spearhead a merger now that rivals are out of bankruptcy. United, despite efforts, has been unsuccessful in finding a merger partner. Other rivals, such as Continental, appear to be content to stand alone unless other rivals act first.
"That leaves one, Delta," Parker tells the Times, while pointing out that his former takeover target is now trading at a value of about $4 billion. Delta executives claimed the airline would be worth as much as $8 billion at the time they worked to reject US Airways' overatures. "There's pressure on them from shareholders to do something," Parker says.
