U.S. Airways bids 8 Billion to buy Delta

[dav8or]

If you fly on the Delta side you better horde up the peanuts. US Air is peanut free.

 

[rickair7777]

If you fly on the Delta side you better horde up the peanuts. US Air is peanut free.

I prefer pretzels anyway.

 

[jeroom]

On the delta side, we changed not too long ago from the honey-peanut crackers to the sour cream-chive ones...I don't like those, I am ready for a change.

 

[captainv]

from www.fark.com:

US Airways makes $8 billion bid for Delta, looks to create giant airline so riddled with debt and bad ideas that they will actually fly underground.

 

[Bluestreak]

No one! Besides, I wasn't aware that there were ever any winners on the regional side. Hold on everyone! :nuts:

Not good for Comair:


US Airways-Delta Deal Would Intensify Regionals' Rivalry

DOW JONES NEWSWIRES
November 15, 2006 12:58 p.m.
By Mary Ellen Lloyd
Of DOW JONES NEWSWIRES

The growth outlook for regional airlines grew cloudier Wednesday with US Airways Group Inc.'s (LCC) proposed $8 billion purchase of Delta Air Lines Inc. (DALRQ).

Airline industry experts expect the overlapping networks served by the two major airlines and their regional carriers would only mean more competition for the likes of Republic Airways Holdings Inc. (RJET), SkyWest Inc. (SKYW) and Mesa Air Group Inc. (MESA), should the deal be completed.

As a result, shares of regional carriers fell, with SkyWest down 8% recently, Republic Airways off 5% and Mesa trading 2% lower.

"For regional partners, it's just more of the same, in that their relationships with major partners are entirely up for grabs," said Michael Abbey, managing partner of consulting firm Velocity Group.

US Airways said that, if the deal takes place, it would reduce service to "marginal markets" and would discontinue "unprofitable flying," but it wouldn't have to exit any U.S. markets to achieve the $1.65 billion in annual cost savings targeted in the proposed purchase.

But the "new Delta" would cut overall route capacity by 10%, including the divestiture of US Airways' East Coast shuttle business. US Airways Chief Executive Doug Parker said it was too soon to talk about specifics, but that both US Airways' mainline and regional businesses would be cut.

Mesa and Republic work with both airlines, which have "fairly significant network overlap east of the Mississippi," Abbey said.

Atlanta, Charlotte, Boston, Washington, and New York will be key hub regions of focus for antitrust regulators and others, because those are served by both airlines, Abbey said.

Calyon Securities analyst Ray Neidl is also watching what happens with Delta's hub in Salt Lake City, given that US Airways has hubs in Phoenix and Las Vegas.

"My opinion is that some of the regional hubs, in order to save costs and reduce capacity, would go away, and that would affect operations for the regional carriers," Neidl said.

Raymond James downgraded shares of SkyWest and Republic Airways to market perform from strong buy, citing the uncertainties and recent share gains for both stocks.

"The bottom line regarding all of this, in our view, is that uncertainty for the regional airline group as a whole has been increased," analyst Buck Horne said in a note to clients.

SkyWest's existing contract with Delta has been reaffirmed in bankruptcy court, which means US Airways would have to honor the terms of the 15-year agreement, Horne said.

SkyWest's vice president of finance, Michael Kraupp, said in an interview that it's too early to comment on the deal's potential impact on business overall but he, too, noted the approved contract, which covers regional flying in the Atlanta and Salt Lake City markets.

"We are one of the only regional partners of Delta that has a contract affirmed in bankruptcy, and in the event of a merger, we would anticipate that our contract would have to be honored," he said, adding that "US Airways and America West are not huge in either of those markets, particularly when it comes to regional flying."

Contracts for Republic and Mesa with Delta haven't yet been affirmed in bankruptcy court, and creditors may not approve any efforts to enter new long-term deals until the US Airways offer is resolved, Horne said. Both Mesa and Republic are currently rebidding contracts for existing flights with Delta.

Representatives for the other regional carriers couldn't be reached immediately for comment.

In addition, US Airways would likely cut the number of 50-seat regional jets in the combined fleet. Delta has sent out a request for proposals for 50 76-seat planes, but that may not be pursued by US Airways management, putting the added near-term growth potential for SkyWest, Republic and Mesa in question, Horne said.

On the other hand, the deal could open up growth opportunities for the regionals if it paves the way for US Airways to attack costs at Delta's regional carrier, ComAir, more aggressively than Delta has, Horne said.

"ComAir's business with Delta (representing $1 billion in annual revenue) could be substantially curtailed and possibly shut down, which would create substantial growth opportunities for other regional airlines," he wrote.

Still, investors weren't taking any chances Wednesday.

Shares of Republic Airways were recently trading down $1.03 at $17.21. SkyWest was down $2.27 at $25.78, and Mesa was down 18 cents at $9.02.

-By Mary Ellen Lloyd, Dow Jones Newswires, 704-371-4033; [email protected]

 

[Terrain Terrain]

SkyWest's existing contract with Delta has been reaffirmed in bankruptcy court, which means US Airways would have to honor the terms of the 15-year agreement, Horne said.

SkyWest's vice president of finance, Michael Kraupp, said in an interview that it's too early to comment on the deal's potential impact on business overall but he, too, noted the approved contract, which covers regional flying in the Atlanta and Salt Lake City markets.

"We are one of the only regional partners of Delta that has a contract affirmed in bankruptcy, and in the event of a merger, we would anticipate that our contract would have to be honored," he said, adding that "US Airways and America West are not huge in either of those markets, particularly when it comes to regional flying."

Contracts for Republic and Mesa with Delta haven't yet been affirmed in bankruptcy court

skywest will be hiring for ALONG time......

 

[172driver]

On the other hand, the deal could open up growth opportunities for the regionals if it paves the way for US Airways to attack costs at Delta's regional carrier, ComAir, more aggressively than Delta has, Horne said.

What are they gonna do, start killing people now? It doesn't get much more aggressive than throwing out your contract in BK and imposing whatever you like.

 

[Smacktard]

combined to create the worlds largest crappy airline! we lose more bags and piss more people off than any airline in history!

Great, that means we're gonna hear "wind check" all over the east coast...

 

[John Pennekamp]

Great, that means we're gonna hear "wind check" all over the east coast...

BAAAAAAAAAAAAAAAAHahahahahahahahahahahahaha! :laugh::laugh::laugh:

 

[ATR-DRIVR]

skywest will be hiring for ALONG time......

hiring for how long?