Did US (HP) acquire AMR, was it a merger or what ?
- Thread starter Barfbag
- Start date
It doesnt matter.
People try and distinguish between them in order to support their arguements, but in reality the circumstances as to what lead to the combining of workgroups doesnt really matter, what they bring means more.
For years people have said that TWA was an aquisition, not a merger, but it was a merger, a merger of work forces through aquistion. The same rules apply regardless of what they call it.
People try and distinguish between them in order to support their arguements, but in reality the circumstances as to what lead to the combining of workgroups doesnt really matter, what they bring means more.
For years people have said that TWA was an aquisition, not a merger, but it was a merger, a merger of work forces through aquistion. The same rules apply regardless of what they call it.
jimntx
Veteran
Amen, Mr. Owens. Unless you are an executive, it doesn't matter whether you call it a merger, a purchase (or acquisition if we are being particularly grand) or a ham and cheese sandwich, the process is not designed to be to your best interests. And, you have to listen for the corporatespeak phrases that are warning signs. For instance... 1. If they say, "There will be no layoffs." Then, if you are near the bottom of the seniority list, start an active job search. 2. If they say, "There are no plans to close (fill in the blank)." Then, if you are stationed there, start packing. 
(Please excuse the formatting. The editor does not seem to want to allow me to hit the enter key and go to the next line or insert a blank line for a new paragraph.)
(Please excuse the formatting. The editor does not seem to want to allow me to hit the enter key and go to the next line or insert a blank line for a new paragraph.)
wings396
Veteran
- Aug 20, 2002
- 3,672
- 1,122
I would honestly have to say that this is a true merger. While US, HP, or whatever you want to call it was the one pushing to make it happen, there was no cash payment made to purchase AA. It's a stock/equity deal that offered a percentage of new stock to the shareholders and investors of the new company. Basically the assets of both airlines combined into one new company.
And exactly how does that factor into merging the workgroups?
wings396
Veteran
- Aug 20, 2002
- 3,672
- 1,122
Unless I missed something, I don't think that was what the topic starter asked. Read his caption, and get back to me. I'm not seeing any refrence to employees in his asking, so I didn't address that. I think that all of our wonderful unions will figure that out for us.
From a strictly legal standpoint, the upcoming combination of AA and US will be a reverse subsidiary merger. US and a newly formed subsidiary of AMR will merge with the AMR subsidiary being the surviving company. That will make US a subsidiary of AMR, just like AA is a sub of AMR.
As most people probably realize, the practical effect of the combination will be a takeover of AA by the management of US. Just like the takeover of US by the management of HP in 2005. That transaction was also a merger just like the upcoming AA-US merger. The legal structure of the transaction does not define the practical result. In the merger of UA and CO, the practical result was a takeover of UA by CO management. The past 13 months at UA have demonstrated the folly of the smaller company imposing its procedures and policies upon the larger company. To Parker's credit, he has talked about Smisek's foolish mistakes and says that US-AA won't repeat those errors. For those with short memories, Parker also committed the same errors when he took over US. Smisek didn't learn from Parker's mistakes; perhaps Parker did learn from his own earlier mistakes plus Smisek's more recent duplication of those errors.
And as most probably realize, AA acquired certain assets of TWA in 2001 and offered employment to most TWA employees. In many ways, the TWA asset acquisition was equivalent to a merger, except in the strict legal sense, as AA did not assume any liabilities beyond those it expressly assumed. In a corporate merger, no liabilities are excluded - the surviving entity is saddled with all liabilities of both pre-merger companies.
As most people probably realize, the practical effect of the combination will be a takeover of AA by the management of US. Just like the takeover of US by the management of HP in 2005. That transaction was also a merger just like the upcoming AA-US merger. The legal structure of the transaction does not define the practical result. In the merger of UA and CO, the practical result was a takeover of UA by CO management. The past 13 months at UA have demonstrated the folly of the smaller company imposing its procedures and policies upon the larger company. To Parker's credit, he has talked about Smisek's foolish mistakes and says that US-AA won't repeat those errors. For those with short memories, Parker also committed the same errors when he took over US. Smisek didn't learn from Parker's mistakes; perhaps Parker did learn from his own earlier mistakes plus Smisek's more recent duplication of those errors.
And as most probably realize, AA acquired certain assets of TWA in 2001 and offered employment to most TWA employees. In many ways, the TWA asset acquisition was equivalent to a merger, except in the strict legal sense, as AA did not assume any liabilities beyond those it expressly assumed. In a corporate merger, no liabilities are excluded - the surviving entity is saddled with all liabilities of both pre-merger companies.
Here you go again perpetuating this falsehood.
The legal definition of a merger according to the CAB and the McCaskill-Bond amendment is as follows:
"The term 'merger' as used herein means to join action by the two carriers whereby the unify, consolidate, merge, or pool in whole or in part their separate airline facilities or any of the operations or services previously performed by them through such separate facilities."
ContUNITEus
Veteran
- May 4, 2011
- 501
- 580
Very good explanation FWAAA
The way I understood them to be so far was:
UA <- US US wanted to be purchased by UA, deal fell through
AA <- TW purchase/acquisition
HP - US full merger (HP pursued US in BK but US didn't do good enough of a job of raping the employees, so HP suggested that US go back into BK2 to rape some more, so that costs were low enough for HP to manage them.
DL - NW merger but the transaction was made as an acquisition by DL of NW
UA - CO full merger /all stock swap
US - AA full merger
Of course people are gonna debate them based on their ego.
The way I understood them to be so far was:
UA <- US US wanted to be purchased by UA, deal fell through
AA <- TW purchase/acquisition
HP - US full merger (HP pursued US in BK but US didn't do good enough of a job of raping the employees, so HP suggested that US go back into BK2 to rape some more, so that costs were low enough for HP to manage them.
DL - NW merger but the transaction was made as an acquisition by DL of NW
UA - CO full merger /all stock swap
US - AA full merger
Of course people are gonna debate them based on their ego.
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #13
The legal definition does not necessarily have anything to do with the practical result, in part because labor laws regarding combination of work forces are totally different.
From a labor standpoint, unless there is significant dissatisfaction with labor unions at the larger carrier, representation in the airline industry follows the labor unions - or status in the case of non-union groups - of the larger carrier.
Parker may have learned from mistakes Smisek has made but AA/US still has a host of unique circumstances which new AA has to overcome that no previous airline has faced and which have to be overcome.
Few would have predicted UA/CO would have become as difficult of a merger as it has been.... which goes to show how dangerous to predict the outcome - either positive or negative - this early in the process.
From a labor standpoint, unless there is significant dissatisfaction with labor unions at the larger carrier, representation in the airline industry follows the labor unions - or status in the case of non-union groups - of the larger carrier.
Parker may have learned from mistakes Smisek has made but AA/US still has a host of unique circumstances which new AA has to overcome that no previous airline has faced and which have to be overcome.
Few would have predicted UA/CO would have become as difficult of a merger as it has been.... which goes to show how dangerous to predict the outcome - either positive or negative - this early in the process.
SWA made an acquisition with FL. All groups did some type of seniority intergration. God knows what the pilots did. FA, TWU ( ramp, ops agents and provo ) got a 2.5 year boost on seniority ( variations are out there). IAM ( Customer Service) got straight date of hire. Perhaps this was the only true acquisition in the major airline groups. No one was stapled. TWU (555) and IAM (142) went to arbritation.
