DELTA trying to buy American Airlines (Austin, Fort Worth: buying, bankruptcy, prices)

[Exult.Q36]

FORT WORTH, Texas >> Shares of Delta Air Lines Inc. rose today after a report that the world's second-biggest airline may try to buy American Airlines parent AMR Corp.
The Wall Street Journal reported that Delta and buyout firm TPG were separately looking at AMR, which is in the early stages of reorganizing through the bankruptcy process.
Delta, AMR and TPG declined to comment.
Three big mergers since 2008 have helped the airline industry by reducing competition and making it easier to raise prices. In one of those deals, Delta bought Northwest.
American missed out on the merger mania and fell from first to third among the world's biggest airlines by passenger traffic. US Airways Group Inc., which tried to buy Delta out of bankruptcy in 2006, is widely viewed as a possible bidder for AMR. US Airways declined to comment.

Delta reportedly interested in buying American Airlines' parent - Hawaii News - Honolulu Star-Advertiser

Maxim Group analyst Ray Neidl said in a research note to investors that he believes a Delta-AMR combination is unlikely.
"We believe that any possible takeover of AMR by Delta is remote since the sheer market size of the combined airlines would probably not obtain DOJ (Department of Justice) or foreign approval," Neidl said. "AMR, even though they are in bankruptcy, is not a failing company since we believe that they can successfully reorganize, hence this argument would have a difficult hearing with the DOJ."
Read more here: http://blogs.star-telegram.com/sky_t...#storylink=cpy

[Dallaz]

Ahhhh! That means the American Airlines Center's name will change to Delta Center.......EWWWW.

[Trae713]

Too little airliners. Don't like this, but it probably has to happen.

[Exult.Q36]

Originally Posted by Trae713

Too little airliners. Don't like this, but it probably has to happen.

It’s not going to happen....Delta and American Airlines merging would be horrible for the Airline industry.... If you think the legislators down in Austin will allow Texas largest Airline carrier to merge with Delta, which more than likely will shift the headquarters to Atlanta think again. Besides DOJ will not approve of such merger because it would give Delta a massive share of the airline market.

[Metro Matt]

I'd like to hear JustMe02's opinion on this since he works in the industry.

[Made_it_To_the_Metroplex]

This just has to be a ploy for Delta to achieve some other end. How on earth could the combined NW/DL not already be big enough? Some say the airline industry needs further consolidation, but that's a scary thought as a passenger. It seems we're on a path to a single (or maybe a few at best) monolithic carrier a la the Soviet-era Aeroflot.

[JimBaker488]

Originally Posted by Metro Matt

I'd like to hear JustMe02's opinion on this since he works in the industry.

Me to, and sooner or later we will get his input with the latest info on these reports about Delta and also TPG, alka "Texas Pacific Group".
Remember TPG is the FTW-based group that had an interest in Continental way back before they were acquired by United. I guess US Airways is also in the conversation ?
I'm sure Delta would love to restore their old hub at DFW and AMRs other very successful hub at Miami probably has them drooling ?
It seems the big question here is could parts & components of AMR be sold off seperately to different carriers/interests or would most of the origional AMR basically remain intact when it emerges from Chapter 11 although surely in a more compact, leaner form ?
There is little question that somebody will have a giant hub operation at DFW but AMRs corporate headquaters remaining in FTW is much more uncertain ?

[Spade]

I don't see how the feds approve this and yes, the Texas govt will probably get involved.

[ggolf]

It makes a lot of sense from a business standpoint. Delta eliminates a major competitor, gets back into DFW in a huge way, and if the price is right, can sell assets up the wazoo and make money.
I'd be happy because I'd never have to park my butt in a seat on a MD-80 ever again!

Yes, it'll be bad for Texas and Ft Worth.

[loves2read]

I think there is too much route overlap for Delta to buy American or merge -- same with couple of other airlines
it should be illegal from that issue is nothing else--taking down a competitor to improve ONE COMPANY's bottom line is not doing to do American economy really any good--
and it would be death to AA retirees...

there was another article in FTW paper today about the Pension Benefit Guaranty Corp--the federal agency who has to come up with the money to pay pensions when companies default...

Pension agency's chief warns American not to kill pensions as part of bankruptcy | Airline...

basically trying to warn not just AA about the fiasco if pensions are going to be chopped along with other contracts/problems that AA says it has to contain to become viable...

AA has already defaulted on long-term promises/contract provisions about health care for retirees...in an attempt to bolster the company's bottom line...and that really was either too late or just not that helpful in light of so many other ongoing problems...

the fact is I don't think AA executives can really be trusted to come up with what is the BEST solution to designing a plan that serves the needs of so many different players with skin in the game...
there is too much self-interest/reward that comes into play...
but I also don't think the bankruptcy court is likely to be strong enough to stand against criticism for anything that rocks the boat of what is likely to be the suggested outcome...
corporate greed usually rules in these instances...and manages even to influence blind justice...

the idea that companies would be interested in picking AA's bones is not new--I suggested it when I first heard about the bankruptcy filing and I am certainly no airline-insider...
that possibility was probably one reason for all the early trading in AA stock--the likelihood that someone was going to buyout AA and there would have to be some incentive to stockholders...