The US Airways /American Airlines merger-related thread (merged threads)
Jan 12, 2012, 2:47 pm
#1
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The US Airways /American Airlines merger-related thread (merged threads)
The more, the merrier:
Delta Air Lines Inc., US Airways Group Inc. and private-equity firm TPG Capital are separately assessing possible bids for American Airlines parent AMR Corp., with hopes that AMR's troubles presents another opportunity for airline consolidation, people familiar with the matter said.
Source: WSJ.com
Delta Air Lines Inc., US Airways Group Inc. and private-equity firm TPG Capital are separately assessing possible bids for American Airlines parent AMR Corp., with hopes that AMR's troubles presents another opportunity for airline consolidation, people familiar with the matter said.
Source: WSJ.com
Jan 12, 2012, 2:49 pm
#2
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The more, the merrier:
Delta Air Lines Inc., US Airways Group Inc. and private-equity firm TPG Capital are separately assessing possible bids for American Airlines parent AMR Corp., with hopes that AMR's troubles presents another opportunity for airline consolidation, people familiar with the matter said.
Source: WSJ.com
Delta Air Lines Inc., US Airways Group Inc. and private-equity firm TPG Capital are separately assessing possible bids for American Airlines parent AMR Corp., with hopes that AMR's troubles presents another opportunity for airline consolidation, people familiar with the matter said.
Source: WSJ.com
LAX
Jan 12, 2012, 2:52 pm
#3
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Jan 12, 2012, 3:11 pm
#4
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Jan 12, 2012, 3:13 pm
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Yet AMR has more cash, more assets and a cleaner balance sheet than US. Not to mention that post-BK AMR will be in an even stronger financial position.
Jan 12, 2012, 3:34 pm
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Jan 12, 2012, 4:10 pm
#7
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Exactly. When US tried to take over DL (prior to being rebuffed), US stock was valuable. Much more valuable than today. These days, LCC is barely above "Ch 11 may be on the horizon" value, meaning that the only currency US could offer the creditors would be borrowed money. AA cleans up its debt problem only to have Doug Parker borrow billions to take over AA as it exits Ch 11? I don't see anyone thinking that's the best alternative.
Jan 12, 2012, 5:43 pm
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Extra! Extra! Read all about it! This just in: Sidewalks get wet in the rain.
Jan 12, 2012, 5:59 pm
#9
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American is not unlike Eastern or PanAm before their demise - once proud and powerful but now without much prestige or value. Not to say they can't turn it around because the comeptition has been winnowed but unless something changes the AA brand is past its prime. UACO and DL are much stronger brands today. Not sure why anyone would pay too much for AA but we will see.
Also, it is doubtful that the feds would allow a DL/AA merger; they did the right thing with AT&T/T-Mobile so we should expect Obama to pick the side of the consumer. If another adminstration takes office it is anyone's guess.
Also, it is doubtful that the feds would allow a DL/AA merger; they did the right thing with AT&T/T-Mobile so we should expect Obama to pick the side of the consumer. If another adminstration takes office it is anyone's guess.
Jan 12, 2012, 6:38 pm
#10
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This is my thought which I touched on in some other thread. Although there are more than four airlines remaining, there are only four legacy carriers (if you truly wish to consider US a legacy since it was HP that swallowed them). Just like four nationwide mobile phone providers shrinking to three was seen as bad for consumers, four legacies shrinking to three would probably be seen in a similar light.
Jan 12, 2012, 8:06 pm
#11
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While US/AA would work, I can't see DL/AA passing muster - just too big and probably putting the nail in US's coffin, leading to 2 major carriers.
Jan 13, 2012, 3:26 am
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Having worked in M&A I'd be very circumspect regarding post-merger integration, US still has issues with contracts since America West
Jan 13, 2012, 4:14 am
#13
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Exactly. When US tried to take over DL (prior to being rebuffed), US stock was valuable. Much more valuable than today. These days, LCC is barely above "Ch 11 may be on the horizon" value, meaning that the only currency US could offer the creditors would be borrowed money. AA cleans up its debt problem only to have Doug Parker borrow billions to take over AA as it exits Ch 11? I don't see anyone thinking that's the best alternative.
Jan 13, 2012, 1:47 pm
#14
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US has hired Millstein and Barclays to help with evaluating a bid.
Jim Millstein, a longtime restructuring banker who most recently oversaw the Treasury Department’s turnaround of American International Group Inc., and Barclays have been advising US Airways while American’s parent company, AMR Corp., works through bankruptcy proceedings, the people said.
Any bid for AMR is likely many months away and would hinge on AMR’s ability to use the Chapter 11 process to chop its labor costs, shed unwanted aircraft and mark down its contracts with suppliers, people familiar with the matter said. AMR filed for Chapter 11 bankruptcy protection in late November.
Still, rivals are circling the airline and assessing strategic options. US Airways finds a combination with AMR compelling, said a person familiar with the matter, but is waiting for AMR to tackle its bankruptcy issues before making any formal proposals about a tie-up.
Any bid for AMR is likely many months away and would hinge on AMR’s ability to use the Chapter 11 process to chop its labor costs, shed unwanted aircraft and mark down its contracts with suppliers, people familiar with the matter said. AMR filed for Chapter 11 bankruptcy protection in late November.
Still, rivals are circling the airline and assessing strategic options. US Airways finds a combination with AMR compelling, said a person familiar with the matter, but is waiting for AMR to tackle its bankruptcy issues before making any formal proposals about a tie-up.
Jan 13, 2012, 1:56 pm
#15
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If successful, the new airline name should be TWA. American is a 2nd choice. US Airways is not a very prestigous name, though better than America West.