Delta takeover bid losing altitude, report says
The Associated Press
Published on: 01/23/07
US Airways' takeover bid for Delta Air Lines may be faltering, according to one report Tuesday, and the Arizona-based carrier's CEO isn't saying if it might further sweeten the offer to impress Delta's creditors.
"It's not a yes," Parker said when asked by The Associated Press if US Airways would again increase its offer, currently valued at $10.1 billion.
But, he quickly added, "We're always willing to talk to people."
His comment came as a Wall Street Journal report suggested that his company's bid for Delta is losing traction with Delta's bankruptcy court creditors, who would have to force Delta management to pursue the deal. The Journal cited unnamed sources.
In addition the Journal, which had previously reported that Delta and Northwest were also talking about a potential merger as an alternative to the US Airways deal, reported Tuesday that those talks are on hold. Any such deal would not likely be pursued until after both carriers were out of bankruptcy proceedings, if ever, it reported.
Parker, in his interview with the AP, said Delta's official committee of unsecured creditors has not indicated that it wants US Airways to offer more money.
In fact, Parker said he is in the dark about what the creditors committee is thinking. The committee has not issued a statement about its position since US Airways increased its offer for Delta nearly 20 percent on Jan. 10.
"There's been no negotiating whatsoever," Parker said. "No one has come back to us and said we should increase our offer."
A Feb. 7 bankruptcy court hearing in New York has been scheduled to discuss the disclosure statement to Delta management's reorganization plan, which calls for the Atlanta-based airline to emerge from Chapter 11 by the middle of this year as a standalone carrier. If the statement, which includes details of Delta's operations, is approved, Delta could begin soliciting votes for approval of its reorganization plan.
US Airways wants Delta's official creditors committee to support postponing that hearing. It has said that if that condition is not met by Feb. 1, along with several other conditions, it will revoke its bid for Delta.
Parker said Tuesday that US Airways made that point to the creditors committee as recently as last week that time is running out for action by the committee.
"We made it crystal clear, if there is no action by Feb. 1, then our offer is withdrawn," Parker said. "They fully understand that now. We're dead serious about the deadline.":laugh:
The Wall Street Journal report said the creditors committee has grown skeptical of the proposed merger. A lawyer for the committee, Daniel Golden, did not immediately return a call seeking comment Tuesday from the Associated Press.
The committee usually meets on Wednesdays and could have a statement about its position soon. Also Wednesday, a hearing has been scheduled by the Senate Committee on Commerce, Science and Transportation on the state of the airline industry and the potential impact of airline mergers. Senior US Airways and Delta executives are expected to address the hearing.
Delta's board, meanwhile, could vote on US Airways' most recent offer this week.
Parker said he has no insight on the validity of the rumors and speculation swirling about the fate of his airline's bid for Delta.
"It is what it is," Parker said. "Right now, we're just reacting to rumors. But no one has told us our proposal they're not happy with, and no one has asked us to increase it."
The Associated Press
Published on: 01/23/07
US Airways' takeover bid for Delta Air Lines may be faltering, according to one report Tuesday, and the Arizona-based carrier's CEO isn't saying if it might further sweeten the offer to impress Delta's creditors.
"It's not a yes," Parker said when asked by The Associated Press if US Airways would again increase its offer, currently valued at $10.1 billion.
But, he quickly added, "We're always willing to talk to people."
His comment came as a Wall Street Journal report suggested that his company's bid for Delta is losing traction with Delta's bankruptcy court creditors, who would have to force Delta management to pursue the deal. The Journal cited unnamed sources.
In addition the Journal, which had previously reported that Delta and Northwest were also talking about a potential merger as an alternative to the US Airways deal, reported Tuesday that those talks are on hold. Any such deal would not likely be pursued until after both carriers were out of bankruptcy proceedings, if ever, it reported.
Parker, in his interview with the AP, said Delta's official committee of unsecured creditors has not indicated that it wants US Airways to offer more money.
In fact, Parker said he is in the dark about what the creditors committee is thinking. The committee has not issued a statement about its position since US Airways increased its offer for Delta nearly 20 percent on Jan. 10.
"There's been no negotiating whatsoever," Parker said. "No one has come back to us and said we should increase our offer."
A Feb. 7 bankruptcy court hearing in New York has been scheduled to discuss the disclosure statement to Delta management's reorganization plan, which calls for the Atlanta-based airline to emerge from Chapter 11 by the middle of this year as a standalone carrier. If the statement, which includes details of Delta's operations, is approved, Delta could begin soliciting votes for approval of its reorganization plan.
US Airways wants Delta's official creditors committee to support postponing that hearing. It has said that if that condition is not met by Feb. 1, along with several other conditions, it will revoke its bid for Delta.
Parker said Tuesday that US Airways made that point to the creditors committee as recently as last week that time is running out for action by the committee.
"We made it crystal clear, if there is no action by Feb. 1, then our offer is withdrawn," Parker said. "They fully understand that now. We're dead serious about the deadline.":laugh:
The Wall Street Journal report said the creditors committee has grown skeptical of the proposed merger. A lawyer for the committee, Daniel Golden, did not immediately return a call seeking comment Tuesday from the Associated Press.
The committee usually meets on Wednesdays and could have a statement about its position soon. Also Wednesday, a hearing has been scheduled by the Senate Committee on Commerce, Science and Transportation on the state of the airline industry and the potential impact of airline mergers. Senior US Airways and Delta executives are expected to address the hearing.
Delta's board, meanwhile, could vote on US Airways' most recent offer this week.
Parker said he has no insight on the validity of the rumors and speculation swirling about the fate of his airline's bid for Delta.
"It is what it is," Parker said. "Right now, we're just reacting to rumors. But no one has told us our proposal they're not happy with, and no one has asked us to increase it."
imp:
