Wn Ceo Says It "won't Compete With The Bid

[USA320Pilot]

Southwest, Still Eager for Philadelphia Airport Gates, Cites Roadblock

Southwest chief executive officer Gary Kelly spoke to attendees at yesterday's Merrill Lynch conference in New York regarding US Airways assets. "I wouldn't discount the thought of making a bid" for some US Airways assets, Kelly said. "But realistically, we're just offering to pay a certain amount for gates in Philadelphia...that won't compete with the bid that's on the table."

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Regards,

USA320Pilot

 

[skyguy25]

and you think you can trust that statement? You are very trusting aren't you... you don't honestly think that Southwest's CEO is a pacifist and not go for the stab at the last minute like they did with ATA and AirTran; or that they would reveal their companies strategies do you? PLEEEZZZZ.

 

[USA320Pilot]

Kelly also repeated that Southwest is interested in acquiring gates at the Philadelphia airport if a combined America West and US Airways decide to shed gates. He said Southwest would like to expand in Philadelphia but could turn elsewhere if it can't find more gates.

One expansion option, Kelly said, is Dallas, where Southwest is lobbying to repeal a 1979 law that prevents it from flying from close-in Love Field to anywhere beyond Texas and seven nearby states. American Airlines, the largest U.S. carrier and a dominant player at nearby Dallas-Fort Worth International Airport, opposes lifting the restrictions at Love Field.

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Regards,

USA320Pilot

 

[robbedagain]

I wonder if there is going to be a three way deal involing SWa buying/leasing gates form us and may be have AC US andHP and maybe UA move into three or so terminals? could that be something in the works?

 

[USA320Pilot]

Robbedagain:

When you look at Concourse "D" and consider the US Airways, America West, and Air Canada deal, the new US Airways and its expanded operation could benefit from gate changes and a "cash" deal with Southwest. Moreover, the move could help United too, even with its diminished roll in North American code sharing with the new US Airways apparently positioning itself to keep West Coast and international traffic on the new business entity and Air Canada.

Meanwhile, I understand that plans are in the works for Air Canada to quickly move into the new US Airways terminals and vice versa, which should further cut costs and boost revenue. Furthermore, I understand this was discussed by Bruce Ashby and Robert Milton at last week's Star Alliance conference in Japan.

Regards,

USA320Pilot

 

[funguy2]

Southwest is clearly preparing some kind of bid, and they are clearly sending out "feelers" to HP, US, and/or the BK judge to see if they can work something out, or if they need to approach it as a more hostile situaiton.

Thats my opinion.

 

[Cosmo]

Southwest is clearly preparing some kind of bid ...

I think that's exactly right, but I believe Southwest has put all of US Airways' assets in play. Does anyone think carriers like JetBlue, AirTran, American, Delta and others are going to sit back and simply assume that nobody else will bid for any assets other than Southwest's presumed bid for only a few gates in PHL? IMHO, Southwest's comments could start a feeding frenzy as other carriers decide this is an opportunity that can't be missed and thus go after DCA/LGA/ORD slots, DCA/LGA/BOS/ORD/CLT/FLL gates, and perhaps even some of the newer A320/A330 aircraft, to name just a few things. Meanwhile, Southwest just smiles and says, "Aw, shucks, we just wanted a few gates at PHL" while US Airways teeters on the edge of liquidation as the possible asset bids far exceed the value (12% of $850 million, or $102 million) assigned to the unsecured creditors in the America West/US Airways merger agreement. If the unsecured creditors can attract, say, $250 million or more in asset bids (in cash!), will that be enough to outweigh receiving $102 million in stock in a merged carrier with good, but not guaranteed, prospects for future profitability? I certainly don't know the answer to that question, but I would assume that there is a point at which the asset bids are large enough for the creditors to decide to take the money and run. JMHO.

 

[Bud8EE]

I think that's exactly right, but I believe Southwest has put all of US Airways' assets in play. Does anyone think carriers like JetBlue, AirTran, American, Delta and others are going to sit back and simply assume that nobody else will bid for any assets other than Southwest's presumed bid for only a few gates in PHL? IMHO, Southwest's comments could start a feeding frenzy as other carriers decide this is an opportunity that can't be missed and thus go after DCA/LGA/ORD slots, DCA/LGA/BOS/ORD/CLT/FLL gates, and perhaps even some of the newer A320/A330 aircraft, to name just a few things. Meanwhile, Southwest just smiles and says, "Aw, shucks, we just wanted a few gates at PHL" while US Airways teeters on the edge of liquidation as the possible asset bids far exceed the value (12% of $850 million, or $102 million) assigned to the unsecured creditors in the America West/US Airways merger agreement. If the unsecured creditors can attract, say, $250 million or more in asset bids (in cash!), will that be enough to outweigh receiving $102 million in stock in a merged carrier with good, but not guaranteed, prospects for future profitability? I certainly don't know the answer to that question, but I would assume that there is a point at which the asset bids are large enough for the creditors to decide to take the money and run. JMHO.

[post="276341"][/post]​

The judge has to balance all parties interests and the unsecured creditors take a back seat to the secure creditors. The judge will not force an assett divestiture that negatively impacts the merger agreement or puts the secured creditors interest in jeoprady. The size and magnitude of the deal, is only in jepeorady of someone coming in and offering a deal in excess of 1.5+ billion, thus protecting the interest of the secured and the many. That is probably why the deal was structured the way it was and why Southwest alluded to the the fact, unless U/HP and the secured creditors see benift, this deal effectively ties everything up.

 

[robbedagain]

Thank you USA320. I am currently a furloughed ramp agent. I would however love to see USAIRWAYS the new one survive. but if this thing with SWA takes off and say there is an assett frenzy, would that cause a liquidation regardless or what?

 

[Art at ISP]

As I just said in another thread, ANYTHING is possible in this business, but I don't see anything happening with Southwest...or at least anything that the judge would accept.

I think the road will be rocky for a while but at the end of the day this merger will happen...and if run right could be a GREAT airline..but that's a big IF now ain't it?

I can say that my experiences on US continue to be outstanding--and it's due to the crews and front line staff--keep it up guys and gals, it IS appreciated by your customers...

Enjoy the chocolates

 

[usairways85]

That statement does not mean WN will not put in a bid for select assets, i think it states that they are not very optimistic their potential bid will win out.

Also with the gate situation in PHL, AC leases its gate(s) from UA, so if AC chooses to move to US gates there will be no loss/gain of gates for anyone...UA will keep their gate.

Second, chances are HP will eventually move in with US at B/C...when that happens i can see a little gate shuffle where WN will give up its 2 gates in D for 3 gates in E...giving them 7 gates all in E. However that is only a gain of 1 gate from their current number, nothing that noteworthy.

 

[TechBoy]

even with its diminished roll in North American code sharing with the new US Airways apparently positioning itself to keep West Coast and international traffic on the new business entity and Air Canada.

[post="276321"][/post]​

How is this going to happen with the combined carrier giving back 60 planes and significantly cutting transcon flying? It seems to me that the new business plan is even more dependant on UA codesharing. Nothing wrong with that of course, unless you have a vendetta against UA.

 

[PITbull]

and you think you can trust that statement?  You  are very trusting aren't you... you don't honestly think that Southwest's CEO is a pacifist and not go for the stab at the last minute like they did with ATA and AirTran; or that they  would  reveal their companies strategies do you?  PLEEEZZZZ.

[post="276311"][/post]​

I do not believe SW will take a jab at this deal. Keep in mind, U has the ability to botch up even this deal. Parker has to make some tuff decisions on who is going with the new merged co. If he is as smart as his employees believe he is; he'll know what to do, and how to do it.

 

[FWAAA]

The judge has to balance all parties interests and the unsecured creditors take a back seat to the secure creditors. The judge will not force an assett divestiture that negatively impacts the merger agreement or puts the secured creditors interest in jeoprady. The size and magnitude of the deal, is only in jepeorady of someone coming in and offering a deal in excess of 1.5+ billion, thus protecting the interest of the secured and the many. That is probably why the deal was structured the way it was and why Southwest alluded to the the fact, unless U/HP and the secured creditors see benift, this deal effectively ties everything up.

[post="276350"][/post]​

Not exactly. You've got it backwards.

Section 1129 of the Bankruptcy Code makes the unsecured creditors the ones who matter. After all, the secured creditors can have their collateral back. If competing bids would cause the unsecured creditors to enjoy a larger dividend, then those competing bids may be approved even if the secured creditors don't like it.