Dal/nwa/co

[Tref]

General Lee,

You're right that some companies have given cash to US Airways and also United. GE Finance is the main culprit. They were giving them finance deals with ridiculously high interest rates, but they really had no choice... Sign or liquidate. Looks like that's why this downturn hasn't seen any of the legacy carriers dissappear, yet.

It looks like that option is even drying up now though. The only way US Airways could get more financing was a merger deal. Viola: America US West Airways-Lines.

Totally agree with the "who knows" part. I sure don't.

 

[General Lee]

COpilot,

Re-read my post. And read this from the Dept of Justice:
http://www.usdoj.gov/atr/public/press_releases/2000/6905.htm

Northwest no longer owns a controlling interest of CO, but part of the agreement is that no other airline can merge with or aquire CO without NWA's consent. I believe that is still the case today. The only loophole seems to be that CO could aquire another carrier, but it would have to be an aquisition, not a merger.

Sorry if this is bad news.

That is the way I heard it too. So, a CAL/DL merger would have to have consent of NW, and I don't think they want to help create a larger competitor. DL has a lot of plusses---like a great hub at ATL, a well defined European presence, only one union, and a great LCC in Song. The negatives would be the debt and pension problems. Both of those could be cleared up in bankruptcy or through help from Congress.(pension extension) We also have trimmed down the size of our airline (pilot numbers have shrunk by 3000 numbers since 9-11). Who knows? (Again)


Bye Bye--General Lee

 

[NuGuy]

COpilot,

Re-read my post. And read this from the Dept of Justice:
http://www.usdoj.gov/atr/public/press_releases/2000/6905.htm

Northwest no longer owns a controlling interest of CO, but part of the agreement is that no other airline can merge with or aquire CO without NWA's consent. I believe that is still the case today. The only loophole seems to be that CO could aquire another carrier, but it would have to be an aquisition, not a merger.

Sorry if this is bad news.

COPilot,

Tref is right on the mark. Under the terms of the agreement with the DOJ, NWA traded in their common stock for preferred stock, while maintaining voting control in some instances, through the use of a "golden share". It allows NW to basically veto any capital project or corporate transaction, which obviously includes mergers.

General,

A merger with NW is very unlikely, because in the event of any merger, that would mean that NW pilots might have the opporunity to bid a crew base that is in or near a desirable place live, instead of a run-down rustbelt town, a god forsaken, frozen, windswept prairie or, well, MEM.

Nu

 

[General Lee]

COPilot,

Tref is right on the mark. Under the terms of the agreement with the DOJ, NWA traded in their common stock for preferred stock, while maintaining voting control in some instances, through the use of a "golden share". It allows NW to basically veto any capital project or corporate transaction, which obviously includes mergers.

General,

A merger with NW is very unlikely, because in the event of any merger, that would mean that NW pilots might have the opporunity to bid a crew base that is in or near a desirable place live, instead of a run-down rustbelt town, a god forsaken, frozen, windswept prairie or, well, MEM.

Nu

Nu,

I have a feeling MEM would be gone in a DL/NW merger. MEM and CVG are too close to the other major hubs, and I would think that they would be chopped. CVG is mainly a Comair base anyway, so they would have to put them all in JFK or GSO. MEM is too close to ATL. Both of those bases are mainly RJ bases anyway, so no major mainline displacements. I am sure there would be fences around aircraft and bases for a few years anyway. I would think you NW guys would like this merger, we don't have more than 500 pilots over 50 years old now. I would hope it would be a percentage merger versus a DOH merger, or we would all be $crewed.......Just a guess, though....maybe....maybe not....


Bye Bye--General Lee

 

[Tref]

General Lee,

I'd agree with you about Memphis shutting down with a DL/NW deal, but MEM does have some advantages: It has huge room to grow and 36C/18C "The World Runway" is about a bazzillion feet long so you can do departures at Max Gross for just about any type.

I was watching the weather channel today and it looked like the weather was pretty nice all over, but Hotlanta still had 45 min delays (and Ohare had 15 mins. There were no other delays in the lower 48.) Having said that, it is the 17th biggest airport in the US and it's half the size of the next one up, so who knows. (Sure would like to meet this "who" guy. Must be a genius.)

As for the seniority merge, since NW and DL are both ALPA carriers it would have to go through the ALPA merger policy. Don't know how that would work exactly, but I think it would be a percentage type deal. (2 DL, 1 NW, 2 DL, 1 NW etc.)

Were probably wasting our time talking about this, but it's an interesting possibility, however unlikely.

Regards,
Tref

 

[jetflier]

I'm pretty sure no one can aquire Continental without NWA's consent. That was part of the stock buy back deal when NWA had to sell a bunch of the Continental stock a few years ago.

There was a rumour awhile back about Continental aquiring Delta because they can buy someone else, they just can't be bought (without NWA's consent.) Seemed kinda crazy at the time, but I'm starting to believe that anything's possible in this industry.

When Richard Anderson was still CEO of NWA, he said that most of the efficiencies of a merger can be achieved through code sharing (which they are doing) without all of the costs/complications.

One factor to consider now though, is that it looks like the only way Wall Street is going to give a US airline any cash is through a merger scenario. They aren't willing to subsidize more losses but are willing to gamble on a possible shift in the status quo.

As to a possible Delta/Northwest combo, I heard a guy come up with the new name: "Delta" from Delta Airlines and "Airlines" from Northwest Airlines. Hope that never happens, but it was good for a laugh.

Here's the latest from NWA...........This is after one of the two "Beach Boys", ( they bought NWA in 1986)

Gary Wilson sold off most of his stock ownership in NWA and coincidently an investment banking firm with deep pockets bought most of the stock at a historically low price.....here's the article......

 

[jetflier]

Even though the fleet types are different, I see DL/NW. There are really no overlapping routes or hubs, and that is what helped with the AWA/US merger. DL and CO both have large hubs in NYC, and DL owns the Shuttle in LGA. That would be a monopoly, and something would have to go. Neither wants to give up a hub like that, and I think each has major obligations to the Port Authority anyway. (maybe CAL has an obligation to the State of NJ or Newark itself for the new terminal) I see CAL and United merging----with a perfect mix of INTL routes, and NW/DL would have the same (DL---Europe and South America, and NW with Asia). I predict it will be called Delwest. (better than Northta) And, I think ASA will merge with Pinnacle, and Comair will be sold to Mesa. (JMO)


Bye Bye--General Lee

Ahhh Gen Lee you left out "Nordel Airlines" and "Delnor Airlines"......
Then we could hane "RD"'s and "RN"'s........bring on the enemas!!!

 

[FutureTEDpilot]

UAL and CAL

 

[NuGuy]

Nu,

I have a feeling MEM would be gone in a DL/NW merger. MEM and CVG are too close to the other major hubs, and I would think that they would be chopped. CVG is mainly a Comair base anyway, so they would have to put them all in JFK or GSO. MEM is too close to ATL. Both of those bases are mainly RJ bases anyway, so no major mainline displacements. I am sure there would be fences around aircraft and bases for a few years anyway. I would think you NW guys would like this merger, we don't have more than 500 pilots over 50 years old now. I would hope it would be a percentage merger versus a DOH merger, or we would all be $crewed.......Just a guess, though....maybe....maybe not....


Bye Bye--General Lee

Hi General...I suspect that in any merger we'll all get $crewed while management takes some golden parachutes.

Nu

 

[Tref]

Hi General...I suspect that in any merger we'll all get $crewed while management takes some golden parachutes.

Nu

NuGuy,


I believe you have cracked the code!