US Airways offers to buy Delta - what will it mean?

[Horace Horsecollar]

Delta creditors actually get very little say since USAir's "bid" is dependent on DL emerging from Bankruptcy. In other words, USAir is NOT stepping up to pay the mess now, they want to wait for DL to be "cleaned" up to buy it.

Actually, the US Airways proposal does deal with paying off "the mess" — settling with creditors. This would allow Delta to emerge from Chapter 11 bankruptcy and then to combine with US Airways, retaining the Delta name for the combined airline.

The same thing happened when America West acquired US Airways. At the time, US Airways was in Chapter 11 bankruptcy. Once the merger terms were worked out, US Airways quickly emerged from bankruptcy. The airlines were then combined, retaining the US Airways name for the combined airline.

Delta has somewhere around $16.0 billion of unsecured claims. US Airways is proposing to pick up Delta for around 8.0 billion in cash and stock.

See the press release: US AIRWAYS PROPOSES TO MERGE WITH DELTA.

I agree that US Airways may not be successful, but that it's likely that some sort of merger with another carrier is in the cards for Delta.

 

[CarolA]

Most of the FF are holding out hope for Continental, but I don't know. They seem to have one of the ONLY management groups that know how to run an airline. (Notice they aren't out trying to "expand", perhaps because they know buying a DOG does nothing to your bottom line except hurt it... Let's see neither USAir or DL have been finanically successful over the past few years so if we combine them we get "Bigger losses" and that's good???)

 

[bicker]

Yes the burden on the tax payers may not be as much, but we will still be paying in another way.

The key, though, is that we'd be paying in proportion to how much we utilize the service, instead of everyone paying the same regardless of how much they travel.

 

[chevyAZ]

We have certainly seen the service go down the tubes in PHX, while the prices go up. There are certainly a lot of P.O'd employees and it shows by the way they treat you.

The airplanes got tighter; I can't even open my laptop in coach if the guy in front of me reclines. Overhead storage is often taken up with crew bags, so you dont get leg room either.

Freq-Flyer miles have been considerably devalued. In fact its very difficult to get 1 round trip ticket from PHX - MCO for less than 50,000 miles, which I find ridiculous. Just a few years ago I could get the same ticket for 20 - 25K.

I cancelled my US Airways Club membership, switched to Southwest and can now get a ticket around 3 times faster, pay approx. 30% less for the ticket and get a smile on top of it all.

My $0.02

 

[rparmfamily]

I really hope this doesn't happen and I don't think that they would get the approval for the sale and merger so I am not counting on it.

 

[bicker]

If there is no other way for Delta to emerge from bankruptcy, or if Delta re-enters bankruptcy within five years, count on a merger taking place. Maybe not with US Airways, but with some airline.