USA320Pilot
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US Airways set to pitch Delta its buyout bid
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USA320Pilot
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EricLv2Fish
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Delta's resistance to the proposed merger should be expected. After all Delta's executives all know that a large portion of them will not be around if the merger goes thru. Not to many people have the character to be objective in such a situation.
Twicebaked
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Agreed, but they will receive "golden parachutes" of such a magnitude that they will NEVER touch the ground. So, would it really be that bad to be shone the door???
I'd be happy to leave with all that money!!!!
Gilding the Lily
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I agree that US will definitely offer Delta management some "golden parachutes"... but we must also remember that as part of the bankruptcy plans, most companies offer their upper management execs a "retention bonus" that is, ironically, larger than what they would typically receive if the company was financially sound. So, any monetary awards offered to the Delta management would be competing with the "bonus" that they would receive for staying with the company under the "stand alone" plan.
They offer this "retention bonus" so that the execs do not cut and run during the middle of the restructuring. The "retention bonus" was significantly altered during the 2005 changes to the bankruptcy code; however, Delta filed before the changes were in place. Thus, it does not affect their bankruptcy. Hmmm... I wonder if that was a coincidence?
Twicebaked
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Twicebaked
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NEW YORK, Nov 30 (Reuters) - Delta Air Lines Inc. (DALRQ.PK: Quote, Profile, Research) said on Thursday it listened to a presentation by US Airways Group Inc. (LCC.N: Quote, Profile, Research) concerning US Airways' $8.5 billion takeover offer for Delta, but repeated earlier statements that it intends to emerge from bankruptcy as a stand-alone carrier.
"Consistent with our obligation to review US Airways' unsolicited proposal, today we, along with representatives of our creditors' committee, met to listen to US Airways' presentation," the airline said in a statement.
"While we will fulfill this obligation, we will, as we have stated, continue to progress toward filing our stand-alone plan by the end of the year, which would have us emerge from bankruptcy as a highly competitive, independent and financially sound airline by mid-2007," the statement said.
"Consistent with our obligation to review US Airways' unsolicited proposal, today we, along with representatives of our creditors' committee, met to listen to US Airways' presentation," the airline said in a statement.
"While we will fulfill this obligation, we will, as we have stated, continue to progress toward filing our stand-alone plan by the end of the year, which would have us emerge from bankruptcy as a highly competitive, independent and financially sound airline by mid-2007," the statement said.
Delta scoffs at U.S. Airways' takeover bid
see here
Undeterred, U.S. Airways Chairman and CEO Doug Parker offered his own post-meeting assessment.
"We were pleased to have made a presentation to both Delta and its creditors about what we believe are the compelling and unique benefits of our plan," Parker said in a U.S. Airways statement.
"We reviewed our offer and had a chance to engage in discussions on the many facets of this proposal. While we recognize the steps that Delta management has taken, we are confident that our proposal for a 'New' Delta will create more value than a stand-alone plan."
see here
Undeterred, U.S. Airways Chairman and CEO Doug Parker offered his own post-meeting assessment.
"We were pleased to have made a presentation to both Delta and its creditors about what we believe are the compelling and unique benefits of our plan," Parker said in a U.S. Airways statement.
"We reviewed our offer and had a chance to engage in discussions on the many facets of this proposal. While we recognize the steps that Delta management has taken, we are confident that our proposal for a 'New' Delta will create more value than a stand-alone plan."
Mr Eagle
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US Airways, Delta Air, Creditors Discuss Merger Bid (Update3)
By Mary Schlangenstein and Eric Torbenson
Nov. 30 (Bloomberg) -- US Airways Group Inc. Chief Executive Officer Doug Parker pitched his $8.43 billion hostile bid for Delta Air Lines Inc. to Delta executives and members of the bankrupt carrier's creditors committee.
Parker, meeting with Delta and the committee for the first time since his Nov. 15 offer, told the creditors in New York they would do better with his plan than Delta's strategy to stay independent.
US Airways and Delta are each courting the nine-member creditor committee because it will negotiate terms of any plan to exit bankruptcy. The panel also heard from Delta on its plan to emerge from Chapter 11 next year as a standalone carrier.
``It's ultimately the creditors of Delta who have got to make the decision,'' said Douglas Baird, a University of Chicago bankruptcy-law professor. ``The obligation on the part of Delta is to make sure information is fairly presented to them.''
Parker, 45, reviewed his offer at today's meeting and ``had a chance to engage in discussions on the many facets of this proposal'' to acquire Delta, the third-largest U.S. airline, Tempe, Arizona-based US Airways said in a statement.
Delta's Statement
Delta, in its own statement, said it ``met to listen to US Airways' presentation'' and didn't elaborate on what comments, if any, its executives made. ``We will, as we have stated, continue to progress toward filing our stand-alone plan by the end of the year,'' Delta said.
Both companies declined to comment beyond the statements.
``This was a meeting that had to happen,'' Baird said in an interview. ``You can't infer from what they are saying that they are doing anything more than the dance their attorneys tell them to do. This kind of dance goes on for a long time.''
A group of Delta bondholders that has formed its own committee hired attorney Alan Kornberg of Paul, Weiss, Rifkind, Wharton & Garrison LLP to represent them in talks on the offer. The bondholders aren't represented on the creditors committee.
US Airways, the seventh-largest U.S. airline, went public with its hostile offer of $4 billion in cash and 78.5 million US Airways shares in hopes of winning creditor support after Delta CEO Gerald Grinstein initially rejected the bid.
Delta creditors would get a 45 percent stake in the merged company, which would surpass AMR Corp.'s American Airlines as the world's biggest carrier, based on miles flown by paying passengers.
US Airways' plan for today's meeting was to ``walk them through our transaction, answer their questions and explain to them why we think our assumptions are the right ones to look at the value of our proposal,'' Kelly Sullivan, a spokeswoman for the airline, said before the session.
Savings, Revenue
Delta has said remaining independent will produce more value for creditors. Grinstein, 74, is working to lower costs by $1.9 billion a year and boost annual revenue by $1.1 billion. The Atlanta-based carrier filed for bankruptcy in September 2005.
Until Feb. 15, Delta has the exclusive right to file its plan to exit bankruptcy protection. Delta has said it expects to file such a plan by the end of December.
Earlier today, Delta said its October net loss narrowed to $88 million from a loss of $301 million a year ago. It reduced costs to fly each seat a mile and boosted per-passenger revenue in October, the carrier said.
``Delta is making strong progress on every front,'' Chief Financial Officer Edward H. Bastian said in a statement that also repeated Delta's intent to leave bankruptcy as a ``stand- alone competitor.''
US Airways shares were unchanged at $56.76 at 4:22 p.m. in New York Stock Exchange composite trading. Shares of Delta rose 6 cents to $1.33 in over-the-counter trading.
Delta's 7.9 percent notes maturing in 2009 were unchanged at 60 cents on the dollar, according to Trace, the bond price reporting system of the NASD. The yield was 28 percent.
The case is In re Delta Air Lines Inc., 05-17923, U.S. Bankruptcy Court, Southern District of New York (White Plains).
By Mary Schlangenstein and Eric Torbenson
Nov. 30 (Bloomberg) -- US Airways Group Inc. Chief Executive Officer Doug Parker pitched his $8.43 billion hostile bid for Delta Air Lines Inc. to Delta executives and members of the bankrupt carrier's creditors committee.
Parker, meeting with Delta and the committee for the first time since his Nov. 15 offer, told the creditors in New York they would do better with his plan than Delta's strategy to stay independent.
US Airways and Delta are each courting the nine-member creditor committee because it will negotiate terms of any plan to exit bankruptcy. The panel also heard from Delta on its plan to emerge from Chapter 11 next year as a standalone carrier.
``It's ultimately the creditors of Delta who have got to make the decision,'' said Douglas Baird, a University of Chicago bankruptcy-law professor. ``The obligation on the part of Delta is to make sure information is fairly presented to them.''
Parker, 45, reviewed his offer at today's meeting and ``had a chance to engage in discussions on the many facets of this proposal'' to acquire Delta, the third-largest U.S. airline, Tempe, Arizona-based US Airways said in a statement.
Delta's Statement
Delta, in its own statement, said it ``met to listen to US Airways' presentation'' and didn't elaborate on what comments, if any, its executives made. ``We will, as we have stated, continue to progress toward filing our stand-alone plan by the end of the year,'' Delta said.
Both companies declined to comment beyond the statements.
``This was a meeting that had to happen,'' Baird said in an interview. ``You can't infer from what they are saying that they are doing anything more than the dance their attorneys tell them to do. This kind of dance goes on for a long time.''
A group of Delta bondholders that has formed its own committee hired attorney Alan Kornberg of Paul, Weiss, Rifkind, Wharton & Garrison LLP to represent them in talks on the offer. The bondholders aren't represented on the creditors committee.
US Airways, the seventh-largest U.S. airline, went public with its hostile offer of $4 billion in cash and 78.5 million US Airways shares in hopes of winning creditor support after Delta CEO Gerald Grinstein initially rejected the bid.
Delta creditors would get a 45 percent stake in the merged company, which would surpass AMR Corp.'s American Airlines as the world's biggest carrier, based on miles flown by paying passengers.
US Airways' plan for today's meeting was to ``walk them through our transaction, answer their questions and explain to them why we think our assumptions are the right ones to look at the value of our proposal,'' Kelly Sullivan, a spokeswoman for the airline, said before the session.
Savings, Revenue
Delta has said remaining independent will produce more value for creditors. Grinstein, 74, is working to lower costs by $1.9 billion a year and boost annual revenue by $1.1 billion. The Atlanta-based carrier filed for bankruptcy in September 2005.
Until Feb. 15, Delta has the exclusive right to file its plan to exit bankruptcy protection. Delta has said it expects to file such a plan by the end of December.
Earlier today, Delta said its October net loss narrowed to $88 million from a loss of $301 million a year ago. It reduced costs to fly each seat a mile and boosted per-passenger revenue in October, the carrier said.
``Delta is making strong progress on every front,'' Chief Financial Officer Edward H. Bastian said in a statement that also repeated Delta's intent to leave bankruptcy as a ``stand- alone competitor.''
US Airways shares were unchanged at $56.76 at 4:22 p.m. in New York Stock Exchange composite trading. Shares of Delta rose 6 cents to $1.33 in over-the-counter trading.
Delta's 7.9 percent notes maturing in 2009 were unchanged at 60 cents on the dollar, according to Trace, the bond price reporting system of the NASD. The yield was 28 percent.
The case is In re Delta Air Lines Inc., 05-17923, U.S. Bankruptcy Court, Southern District of New York (White Plains).
This is only the first phase. Personally, I would rather not have to go through yet another merger but...
BoeingBoy
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Another article from "analyst" Ted Reed:
Parker Keeps His Promise
By Ted Reed
TheStreet.com Staff Reporter
Parker Keeps His Promise
By Ted Reed
TheStreet.com Staff Reporter
Jim
This deal is already dead.
Let's face it, it doesn't make sense to any of us, so why should it make sense to any of the creditors? Many of them may make some extra $$ in the short term (although it will be 2 years or so in the future), but the BIG money creditors (ie Boeing and others) realize that long term money will be better without this merger of two overlapping airlines.
Abe
Let's face it, it doesn't make sense to any of us, so why should it make sense to any of the creditors? Many of them may make some extra $$ in the short term (although it will be 2 years or so in the future), but the BIG money creditors (ie Boeing and others) realize that long term money will be better without this merger of two overlapping airlines.
Abe
Mr Eagle
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deltawatch
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When US Airways tried to hook up with United before, Delta screamed bloody murder. Well if US/UA try again Delta will not be able to say a word this time. UNITED/US AIRWAYS would be a STAND ALONE DELTA's worst night mare ......
Travelpro72
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What I don't get is people saying that there is overcapacity. If this happened and we were to give up oh say 6 gates at DCA some other carrier is going to move in and add what we pretty much got rid of. Where is the reduction? A legacy moves out and a low cost moves in and adds service where there were previously two carriers operating? So where is the reduction? All the low cost carriers have complained about legacies for ages while all they have done over the past few years is add flying and expand like crazy? Why dont THEY downsize? I know some gates and flights would go but other carriers will just add the capacity back. I don't get it.
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