Comments on: Is the US Airways/Delta Merger Finished? http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/ The Daily Airline News by Jared Blank Mon, 01 Dec 2008 19:15:30 +0000 http://wordpress.org/?v=2.5.1 By: Jared http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-811 Jared Fri, 02 Feb 2007 22:41:35 +0000 http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-811 See...even Stuart Klaskin of KKC Aviation agrees with me. See…even Stuart Klaskin of KKC Aviation agrees with me.

]]> By: iahphx http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-810 iahphx Wed, 31 Jan 2007 20:08:00 +0000 http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-810 There's a great quote from AP on this topic: ""Airline consultant Stuart Klaskin of KKC Aviation remained unconvinced US Airways will abandon its consolidation dreams. "I personally think they are going to turn their attention very rapidly to other markets," he said. "If I were the management team at Northwest Airlines, I would be awaiting the call from Parker."" There’s a great quote from AP on this topic:

“”Airline consultant Stuart Klaskin of KKC Aviation remained unconvinced US Airways will abandon its consolidation dreams.

“I personally think they are going to turn their attention very rapidly to other markets,” he said. “If I were the management team at Northwest Airlines, I would be awaiting the call from Parker.”"

]]> By: Jared http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-809 Jared Wed, 31 Jan 2007 18:29:34 +0000 http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-809 It is the derivative of R-squared DR. Thanks for pointing that out, Kwijybo. It is the derivative of R-squared DR. Thanks for pointing that out, Kwijybo.

]]> By: modus ponens http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-808 modus ponens Wed, 31 Jan 2007 16:09:35 +0000 http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-808 did you just apply the law of: P -> Q and P -> R, therefore R and Q? or is it RdRr? did you just apply the law of: P -> Q and P -> R, therefore R and Q? or is it RdRr?

]]> By: iahphx http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-807 iahphx Wed, 31 Jan 2007 15:36:02 +0000 http://boardingarea.com/blogs/onlinetravelreview/2007/01/31/is-the-us-airwaysdelta-merger-finished/#comment-807 Well, first, let's see what happens today. If Delta's creditors turn down USAirways' bid, they will literally be forfeiting BILLIONS of dollars. But if they are that financially stupid (and there certainly is some evidence they are), you could make an argument that USAirways should move on to Northwest. Parker has figured out that the best way to buy an airline is in bankruptcy court. And there's only one other major airline in bankruptcy. That said, Northwest presents fewer "synergies" (aka overlap) than Delta, so the amount of money Parker could throw at their creditors would be less. Of course, there would be a bigger "network" advantage (think Asia) and fewer antitrust issues. It would also bulk up USAirways such that they themselves wouldn't be a target, which is something Parker presumably prefers. One also must wonder whether Parker has the stomach for yet another hostile bid. Hard to see why Northwest's management -- and creditors -- would be any more receptive than Delta's. You could argue that "money" seems to be more important in Northwest's culture than Delta's, so perhaps they'd get a warmer response. It is also worth noting that Parker has a history of "moving on" to new deals. He initially tried to buy ATA's Midway hub. After Southwest derailed the offer, he moved on to the better deal with USAirways. So he's obviously a guy to watch. Well, first, let’s see what happens today. If Delta’s creditors turn down USAirways’ bid, they will literally be forfeiting BILLIONS of dollars. But if they are that financially stupid (and there certainly is some evidence they are), you could make an argument that USAirways should move on to Northwest.

Parker has figured out that the best way to buy an airline is in bankruptcy court. And there’s only one other major airline in bankruptcy. That said, Northwest presents fewer “synergies” (aka overlap) than Delta, so the amount of money Parker could throw at their creditors would be less. Of course, there would be a bigger “network” advantage (think Asia) and fewer antitrust issues. It would also bulk up USAirways such that they themselves wouldn’t be a target, which is something Parker presumably prefers.

One also must wonder whether Parker has the stomach for yet another hostile bid. Hard to see why Northwest’s management — and creditors — would be any more receptive than Delta’s. You could argue that “money” seems to be more important in Northwest’s culture than Delta’s, so perhaps they’d get a warmer response.

It is also worth noting that Parker has a history of “moving on” to new deals. He initially tried to buy ATA’s Midway hub. After Southwest derailed the offer, he moved on to the better deal with USAirways. So he’s obviously a guy to watch.

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