U.S. government, two airlines say open to settling merger fight

[PullUp]

I thought she commented on the bankruptcy court proceedings as well, but can't find it now, so I stand corrected. Nevertheless, two judges in two separate courts seem to be on the same page, reasonably short timeline, POR approval and window wide open for settlement.

The investment community has too many $$ at stake for this to fail.
I predict settlement in the week prior to the trial date and POR approval by Christmas, if not sooner.
Cheers.

 

[Crash Pad DCA]

Usually, I would say that there's a SBCIH that I would EVER agree with anything that WT says, but oh well, here goes...

...Remember the DOJ still has emails and documents showing that AA and US execs intend to eliminate competition, raise prices, and reduce capacity as a result of the merger...

That's why the DOJ+Republican AZ Attorney General+Republican Texas Attorney General+Republican VA Attorney General+PA Attorney General case is strong.

A CEO and the rest of the frat house should know better than to put this stuff in writing. And if they don't know better, then they probabably aren't qualified for the jobs they hold. You certainly don't send an email to the DL CEO indicating that you want him to stop a triple miles promotion because it's going to cost you money and let him know (threaten?) that you are going to drag him through the mud on Wall Street if he doesn't stop the promotion. Put down the bottle, stop the trantrum and grow up!

7K-15K jobs are going after this merger and 10% of flights (including some of these in rural TX and PHX) are going away...But PA is going is going to demand flight guarantees at PHL (like UA had to do in CLE and DL at MEM, MSP and DTW) and PA wants Moon Ops, Airbus MX and the 1,000 jobs associated to stay OR they want their bond and tax credit money back. No easy out for US in PA this time.

This will be settled. The merger will go through. But PA, VA, AZ and TX are all going to get some guarantees out of this (so we will see how many flights and jobs are actually cut before 5 years) and DP and Co are going to get some sort of public slap on the wrist for the email trail...

 

[nycbusdriver]

I expect the next development to be 'in earnest' settlement talks between now and November.

You're probably right. And the bankruptcy Judge Lane now seems like he is going to approve the deal soon, probably knowing it will likely be settled before it sees the courtroom.

It will get settled when LCC gives up the DCA slots it traded at a steep price to Delta, making the "visionary, merger-mad" Parker look quite the fool.

 

[zethya]

.....................
7K-15K jobs are going after this merger and 10% of flights (including some of these in rural TX and PHX) are going away...But PA is going is going to demand flight guarantees at PHL (like UA had to do in CLE and DL at MEM, MSP and DTW) and PA wants Moon Ops, Airbus MX and the 1,000 jobs associated to stay OR they want their bond and tax credit money back. No easy out for US in PA this time.

This will be settled. The merger will go through. But PA, VA, AZ and TX are all going to get some guarantees out of this (so we will see how many flights and jobs are actually cut before 5 years) and DP and Co are going to get some sort of public slap on the wrist for the email trail...

I really doubt they will encumber their demands for PIT stability with PHL. PHL can stand on its own, particularly after the airline joins OW. IMO, NC was foolish for not joining the suit and making stability demands for CLT. They seem to have relied totally on Parker's statements that CLT will not be downsized.
The DOJ is no different than any Used Car salesman - ask for the most outrageus price to set a negotiating baseline, but know full well, you're lucky if you get much more than half. ? for all - is the decison to accept an offer of settlement from AA, the DOJs alone, or do all of the joining States also have to agree? In other words, can a single State, such as TX or PA, hold up the entire process, because they didn't get what they wanted?

 

[Reed Richards]

Again, I think World sees through the fog of war, and I refuse to discount his analysis just because he is a cheerleader for Delta. I wish we had such an advocate! The smoking gun is the DOJ compliant itself, and what they are going after. The emails will be damning, in fact this merger has no chance with Parker leading the New AMR. Not going to happen. They don't want the merger to happen AT ALL, no compromise. It says so in the complaint. Of course, now with a trial, both sides say they are "open" to settlement. What else would they say before a trial? Doug has lied to his own employees saying this was all "out of the blue." This superhero is not buying any of it. The real leverage (despite what you read in the media) is NOT with the airlines and the early trial; it is the looming realization by Parker that soon all his communications will be fully made public, and woven into a tale of evil by the DOJ in the 10 day trial. Just watch. The merger got some breathing room with the Nov date, it would have been dead if March had won. Behind closed doors, Parker treated the DOJ employees just like his own. There will be a price paid, I just hope the US Airways BOD is not stupid enough allow Parker to give away the farm just to save face (and I doubt that is possible anyway!) RR

 

[ograc]

What kind of concessions can even be given in this environment ? Are we going to start shuttering HUBS and throwing a few thousand workers here and a few thousand workers there onto the street ?

nope , politically impossible ..

the economic environment is fading world wide and the egg heads in DC who once though that the economy was just BOOMING months ago are taking a long hard look at what could be a much bleaker future ....

The sensible thing is to allow the merger to go through with only minor concessions .

I see dark clouds on the horizon for those employed in DCA and PHX if this merger is approved. Many employees will become the "synergies" of a combined carrier; either through furlough or displacement. Adverse effects that many, in other stations, have already experienced in order to keep this company afloat. To date... DCA and PHX have been spared.

 

[Reed Richards]

I really doubt they will encumber their demands for PIT stability with PHL. PHL can stand on its own, particularly after the airline joins OW. IMO, NC was foolish for not joining the suit and making stability demands for CLT. They seem to have relied totally on Parker's statements that CLT will not be downsized.
The DOJ is no different than any Used Car salesman - ask for the most outrageus price to set a negotiating baseline, but know full well, you're lucky if you get much more than half. ? for all - is the decison to accept an offer of settlement from AA, the DOJs alone, or do all of the joining States also have to agree? In other words, can a single State, such as TX or PA, hold up the entire process, because they didn't get what they wanted?

I don't really understand the details of how the "government" can tell a business how to operate in the future based on a merger approval now. Maybe the TWA pilots can brief us on the success of such "protections," that being their loss of STL with a New AMR. I will make a couple of predictions. When the merger is really dead, dead in the press and dead in their short term memory, Parker will soon find a way to close both OCC and the PIT Maint. base. I don't agree with either, but the state has it coming. And on a similar note, I give a 50% chance the HQ will be moved to CLT (if this merger somehow happens.) My logic is Texas really pulled a boner going against this merger. Really? RR

 

[700UW]

Those e-mails are from 2007, they wont matter, Parker will be the CEO and the merger will go through.

 

[Reed Richards]

Those e-mails are from 2007, they wont matter, Parker will be the CEO and the merger will go through.

Glad to have an insider such as you, privy to all past and future discovery. All we have seen is the tip of the iceberg on emails. RR

 

[USA320Pilot]

In my opinion, if a settlement is reached between the parties they will include structural and behavioral remedies. The Structural Remedy will be slots at DCA around the number UAL & CAL divested at Newark.

The Structural Remedies could be an agreement to not reduce service in any market currently served by either company, to not increase ancillary fees, or lead an industry fare increase for a period of time. By not reducing service in any market (for a period of time) the New American and the DOJ would appease legisative demands to not pull out of markets like Tallahasse-D.C. and limit fare/fee increases (for a period of time) unless the increase is a reaction to an industry increase initiated by a competitor.

I agree with Huner Keay, one of the brightest new industry analysts, that there is about a 75% chance the proposed corproate combination proceeds.

 

[cltrat]

Glad to have an insider such as you, privy to all past and future discovery. All we have seen is the tip of the iceberg on emails. RR

with all due respect RR his opinion or anyone else for that matter would seem to carry as much weight as yours does in this matter since you seem to know exactly what is going to happen yourself

 

[Reed Richards]

with all due respect RR his opinion or anyone else for that matter would seem to carry as much weight as yours does in this matter since you seem to know exactly what is going to happen yourself

Your due respect is appreciated, but undeserved! Please give my opinions exactly the weight you give that of any anonymous individuals posting on public forums! I have a history of success in my selfish predictions here. Pray I am wrong as of late! RR

 

[Piedmont1984]

If the DOJ had such a strong case, why not push for a early trial instead of March? If their case is weak, delay is a sound tactic. A march trial would have handed them a win without having to defend their complaint. The government says they need time for discovery. Maybe what they really need is time for a fishing expedition. I don't know with any detail what the volume, chronological proximity to current events, or degree of self incrimination these emails represent. Nor do I know what executive or executives authored said emails - but neither does anyone else posting here.

From my perspective, killing this merger will create more harm to this industry than it avoids. The horse (the one we're riding) is literally half way out the barn door. Slam it shut and it's an ugly visual.

 

[Reed Richards]

<p>

If the DOJ had such a strong case, why not push for a early trial instead of March? If their case is weak, delay is a sound tactic. A march trial would have handed them a win without having to defend their complaint. The government says they need time for discovery. Maybe what they really need is time for a fishing expedition. I don't know with any detail what the volume, chronological proximity to current events, or degree of self incrimination these emails represent. Nor do I know what executive or executives authored said emails - but neither does anyone else posting here.

From my perspective, killing this merger will create more harm to this industry than it avoids. The horse (the one we're riding) is literally half way out the barn door. Slam it shut and it's an ugly visual.

1984, if I believed this merger was going to happen, your logic would be my own. There are so many reasons why this lawsuit is wrong. I guess, other than Worldtraveler, I am the contrarian here. Why did they seek the March trial date? Because they never would have to take the kill shot. Now they will. &nbsp. I remain doubtful and have little hope of this merger ever occurring. RR

 

[Piedmont1984]

RR, I'm not saying you're wrong. I'm just saying the DOJ is wrong - and they deserve to lose.