AWA/USAir Merger may be announced in 6 hours

[Doug Parker]

Local news says CEO of USAir is on an America West airplane to Phoenix right now for meetings with, well you know, Doug Parker.

Says an announcement may be expected after stock market closes today at 1pm Phoenix time.

Stay tuned for more "As the Merger turns"

 

[TWA Dude]

I'm holding my breath in anticipation. Darn, that makes me need to have a bowel movement. Later...

 

[Cactus73]

CNBC is reporting that after hours trading and future trading of AWA stock has been put on hold pending an announcement.

 

[amcnd]

DONE
http://www.shareholder.com/americawest/ReleaseDetail.cfm?ReleaseID=163980

 

[TWA Dude]

Key points: USAir losing a bunch of airplanes this year and AWA deferring Airbus deliveries till 2009. I don't wish furloughs on anybody, least of all myself.

 

[PositiveRate]

"The combined airline also will take delivery of 13 Airbus A320 family aircraft previously ordered by America West Airlines. Airbus has also agreed to reschedule and reconfirm 30 narrow body A320-family aircraft deliveries from 2006 - 2008 to 2009 - 2010."


That's not the way I read it....it looks like the remainder of the current Airbus order is coming and future deliveries that were options beyond 2006 will now begin 2009. Either way, it's vaguely worded!

 

[Doug Parker]

It says that USAir is returning an additional 25 a/c before the end of 06 plus the 46 it had already planned on returning.

It also says the carriers will operate under their own certificates until the labor groups can hash out their differences and will take 2 to 3 years.

Sounds like USAir may take some more furloughs before it is all said and done. Not to mention the 1.2 retirements per day will help shrink the pilot group.

Also, the word is that AWA will empty the pool and hire up to 60 additional pilots before the year is over.

The question remains - Will the USAir wholly owneds do ALL of the flying for the new carrier or will Johnny O still have his finger in the pot ???

 

[pnjohn75]

Where did you hear the draining of the pool plus 60 more in 2005??? Would love to see a light at the end of the tunnel with respect to Vegas reserve!!

 

[Doug Parker]

A friend in the pool who has a big connection in the hiring/hr dept was told this info on Monday this week. Other "high ranking" members of the check airman community have been passing this info as well.

But hey, what do I know, I'm just Doug Parker.................

 

[LearLove]

An email from AAA mec guys:


We just received a briefing at the MEC meeting and the highlights
are:

A merger between USAirways and America West has been approved. The
merged company will have a board consisting of 13 board members.
Three form investing equity firms, four from UsAirways to include
Lakefield and six from America West to include their CEO Parker.

Parker will be the new CEO and the headquarters will be in Tempe AZ

It will take about 2-3 years to complete the integration.

The new entity will have 2 billion in cash. That is made up of cash
on hand from both airlines, $350 mil in new equity, $200 mil in
asset sales and another $2-300 mil in released restricted cash.

The $350 mil in equity is made up of:
$75 mil Air Canada
$100 mil Par (hedge fund)
$50 mil Peninsula (hedge fund)
$125 mil from Air Wisconsin

An additional $650 mil will come from other partners. $250 mil comes
from Airbus - with $185 mil available upon exit from bankruptcy. In
exchange for that the new entity has agreed to be the launch
customer for the new AB 350 to be used for international flights.

They expect $650 mil in savings from synergies. $150-200 mil from
route rationalization. Flights will begin to Hawaii.

The mainline fleet will go from a combined 419 aircraft to 361. The
company does not expect furloughs as a result and no timeline for
the fleet size was mentioned.

The plan calls for 239 RJs and 57 turboprops.

CLT PHX PHL will be hubs. LAS BOS DCA LGA and FLL will be focus
cities

USAirways group will be the overall surviving entity. Under
USAirways group will be Merger Sub - merger sub will purchase
America West

You will notice that Wexford is not on the list of equity investors.
No mention of the fate of the 170s at this time.

Mesa is out as a feeder for USAirways but will probably still have a
role with America West.

More as it comes available.
END of email

 

[PositiveRate]

"Sounds like USAir may take some more furloughs before it is all said and done. Not to mention the 1.2 retirements per day will help shrink the pilot group."


Good point, I didn't even factor this into my thinking. That's 800+ retirements in the next couple years which would offset the need for furloughs at USair (at least not massive furloughs). That makes sense why the US mec said they did not expect furloughs....I guess we'll just see.

I know a guy in the pool who would love to hear that he might still come to work and not be drained away because of the deal.

 

[KC-10 Driver]

Does AWA have only A320s, or A319/320/321? And, what type of engines -- CFM or IAE? U has the CFM.

Also, do the AWA 757s have Pratt or Rolls Royce engines? U has the Rolls.

I don't know much about the 737 (even though I'm typed), but are there engine differences which might be an issue?

If the engines are incompatible, does anyone know if the FAA will allow each fleet to be operated as a single qualification?

 

[IP076]

AWA has A319s & A320s..... I looked up 649AW, an A320, and the Registration Database has the engine listed as the IAE V2500.

901AW, a B757, is listed as having the Rolls RB.211.

Engine type does not affect a pilot's type rating. If typed in a 757, you are legal to fly no matter the type of engine.

The big deal comes with Maintenance Training and Certification. I would assume there will have to be substantial maint. training for the different engine types.

 

[KC-10 Driver]

I know that the engines have nothing to do with the type rating, but it is possible for engine differences to require different qualifications.

Back when United was planning on buying US Airways, the 757 engines were different at each company. Supposedly, the FAA had told them that they would not let the merged company operate the 757s as a common qualification due to the number of different fleets at United which had different engines.

That is why American was going to acquire the US Airways 757s as part of the United-US Airways merger. American and US Airways 757s had common engines.

Just wondering if the same issues might apply to the current situation.

 

[husker]

America West flys A319/A320's. V2500 power plants.
Us Airways A319/320/321 CFM 56 power plants
America West and US Airways 757's are both Rolls Royce power plants
America West and US Airways 737's CFM 56

 

[KC-10 Driver]

Thanks husker-

Sounds mostly common -- except for the A320.

Shouldn't be much of an issue.