D L X
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Delta Not In Talks With Northwest

Wed Jan 24, 2007 11:30 pm

http://biz.yahoo.com/rb/070123/delta_northwest.html?.v=2

So, it seems this rumor had not basis. DL will either go it alone, or be taken over by US.
 
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Acey559
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RE: Delta Not In Talks With Northwest

Wed Jan 24, 2007 11:34 pm

As a former Delta Connection employee, I'm praying that they will go it alone. However, I want what is best for the company, and if that means merging then so be it. I just pray that the takeover bid from US gets hung out to dry, as from day one it has made no sense to me. Maybe the NW talks could have been a ploy so US would back off?
 
NW748i
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RE: Delta Not In Talks With Northwest

Wed Jan 24, 2007 11:39 pm

Oh man!!! I was just about to post this. Anyway, I think this is great news. What was the source fo all this about monthly meeting between NW and DL management and ALPA negotiations? An a.net rumor? Maybe a DL management rumor that they would dispell once headlines like "US Airways' bid for Delta loses traction with creditors" show up? Seems like the damage is done there... or at least a couple weeks of reduced pressure on the DL management.

But then who's to say this won't make the creditor swing Parker's way?

Addendum: I also note that just down the street on Capitol Hill, there's a hearing today to discuss this merger before Congress (Parker will be there and I assume that Grinstein will also). It only makes sense that DL management not give the impression that they are in merger talks (or even to allow such rumors to perdure) lest they lose credibility in front of the Senate by appearing to mislead their creditors just to shake Doug... hence this official statement.

[Edited 2007-01-24 15:47:57]
Hail! to the victors valiant, Hail! to the conqu'ring heroes, Hail! Hail! to Michigan the leaders and best! Go Blue!
 
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jetjack74
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RE: Delta Not In Talks With Northwest

Wed Jan 24, 2007 11:44 pm

And this was from yesterday.
http://biz.yahoo.com/bizj/070123/1406741.html?.v=1
You can't believe anything that is coming out of th mouths of these CEO. They only say what the want the public to believe, and right now that is to portray the notion that DL will be a stand-alone carrier. Doug Steenland is saying the same thing to us in his employee addresses. It's all spin, but soemthing is up.
Made from jets!
 
jetlanta
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 12:17 am

Read it all closely. He doesn't say anything that precludes a merger after bankruptcy emergence. Just because they aren't negotiating now, doesn't mean that will be the case when they come out of Chapter 11.
 
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SLCUT2777
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 12:23 am

I think Pat Bagley's cartoon is reaching fruition!:
Big version: Width: 450 Height: 318 File size: 55kb
Pat Bagley, Salt Lake Tribune SLtrib.com

http://extras.sltrib.com/bagley/Archive.asp?Vol=content&Num=33
 biggrin   laughing   rotfl   rotfl   rotfl 
DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
 
D L X
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 12:40 am

Quoting NW748i (Reply 2):
Addendum: I also note that just down the street on Capitol Hill, there's a hearing today to discuss this merger before Congress (Parker will be there and I assume that Grinstein will also). It only makes sense that DL management not give the impression that they are in merger talks (or even to allow such rumors to perdure) lest they lose credibility in front of the Senate by appearing to mislead their creditors just to shake Doug... hence this official statement.

That's a VERY astute observation. I should have guessed really. "News" that something is not happening is not actually news. It usually means there is information that the informant wants someone to know but can't tell him directly.

Quoting Jetjack74 (Reply 3):
And this was from yesterday.
http://biz.yahoo.com/bizj/070123/140...?.v=1

Well, that is very interesting, but it would mean more if it came after the Delta CEO announcement. This makes it look like Grinstein is responding to the WSJ article.

Quoting NW748i (Reply 2):
Hail! to the victors valiant, Hail! to the conqu'ring heroes, Hail! Hail! to Michigan the leaders and best! Go Blue!

You said it, Brother!
 
worldtraveler
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 12:54 am

DL has not denied it has talked with NW....but that is a big difference than officially consummating a merger plan.

In all likelihood, DL and NW are doing the same thing UA and CO did - holding discussions about what a merger might look like - the big difference being that DL and NW apparently got alot further than CO and UA did.

It is doubtful that DL and NW want to merge right away but if they had to due to circumstances, they would be each other's first choice and would do what they could to make it work.
 
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jetjack74
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 1:17 am

Quoting Jetlanta (Reply 4):
Read it all closely. He doesn't say anything that precludes a merger after bankruptcy emergence. Just because they aren't negotiating now, doesn't mean that will be the case when they come out of Chapter 11.

Exactly, it's the same used-car sales pitch we're getting from our CEO which looks to be the MO form both these guys. Let everyone speculate, but downplay it internally.
Made from jets!
 
NW748i
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 1:48 am

Quoting WorldTraveler (Reply 7):
DL has not denied it has talked with NW....but that is a big difference than officially consummating a merger plan.

In all likelihood, DL and NW are doing the same thing UA and CO did - holding discussions about what a merger might look like - the big difference being that DL and NW apparently got alot further than CO and UA did.

This may very well be true--I won't argue with you. However, I think we should bear in mind that they are up in front of career politicians. Appearances and connotations count for a lot and they figure that if something is worth discussing, it naturally follows that it is something being considered--preliminary or otherwise. That's what the committee wants to know about, as well as do the creditors.
Hail! to the victors valiant, Hail! to the conqu'ring heroes, Hail! Hail! to Michigan the leaders and best! Go Blue!
 
gigneil
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 2:11 am

If this is true, then DL has condemned themselves to being taken over by US.

End of story. The creditors will not be given the highest return by them going it alone.

Parker will then win.

NS
 
jetlanta
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 2:23 am

Quoting Gigneil (Reply 10):

Seriously...why do you even bother?

Do YOU even know what you are talking about?
 
D L X
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 3:56 am

Quoting WorldTraveler (Reply 7):
DL has not denied it has talked with NW....but that is a big difference than officially consummating a merger plan.

In all likelihood, DL and NW are doing the same thing UA and CO did - holding discussions about what a merger might look like - the big difference being that DL and NW apparently got alot further than CO and UA did.

Huh? The beginning of the article says that DL is *not* in merger talks:

Quote:
Bankrupt Delta Air Lines Inc. is not in merger talks with rival Northwest Airlines Corp., Delta's Chief Executive Gerald Grinstein said in a newsletter to employees on Tuesday.



Quoting Jetlanta (Reply 11):
Do YOU even know what you are talking about?

Do you?
 
gigneil
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 4:01 am

Quoting Jetlanta (Reply 11):
Do YOU even know what you are talking about?

Yeah, I do. I know that by offering as much money as he has, Parker has put the creditors in a position where they cannot accept a standalone Delta. It does not make any fiscal sense for them.

Delta's only hope was to demonstrate greater value with some other combination. If they are not going to do that, then the creditors are going to go for the proposal with the most cash money.

As an "airline consultant" I would think that the harsh realities of the market would overcome your personal feelings on what Delta is worth.

NS
 
panamair
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 4:06 am

Quoting Gigneil (Reply 13):
If they are not going to do that, then the creditors are going to go for the proposal with the most cash money.

Depends on the individual creditors....as Bethune had been quoted as saying, all these creditors have such diverse agendas and needs (short vs. long-term interests, etc.) that getting them to agree on something is like "herding cats". It is not a given that ALL creditors are going to jump immediately for DP's $5 billion cash proposal...

[Edited 2007-01-24 20:09:53]
 
worldtraveler
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 4:11 am

Quoting NW748i (Reply 9):
Appearances and connotations count for a lot and they figure that if something is worth discussing, it naturally follows that it is something being considered--preliminary or otherwise

But the hearing was called because of US' proposed takeover of DL, not because of DL's talks w/ NW. And the Senators all overwhelming voiced their skepticism regarding mergers, esp. ones that have even the possibility of reducing competition, loading any carrier unnecessarily with debt that has proven to be fatal in the airline industry, or in putting more airline workers on the street.

I didn't hear one word (although I didn't listen to the whole hearing) about protecting the creditors' interests.

DLX,
I suggest you re-read all of what has been said. DL did not deny that it has talked with NW about potential mergers. It did say it is not currently engaged in merger talks. Grinstein's testimony before the Senate today is that DL talked with NW at the request of its creditors who are interested in other strategic alternatives but that those talks are a "far cry from negotiated for a merger." (page 5)
 
SESGDL
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 4:13 am

Quoting Gigneil (Reply 13):

Yeah, I do. I know that by offering as much money as he has, Parker has put the creditors in a position where they cannot accept a standalone Delta. It does not make any fiscal sense for them.

Delta's only hope was to demonstrate greater value with some other combination. If they are not going to do that, then the creditors are going to go for the proposal with the most cash money.

As an "airline consultant" I would think that the harsh realities of the market would overcome your personal feelings on what Delta is worth.

If I was a creditor I surely wouldn't want to assume a $24 billion debt load, and have shares in a company that has borrowed billions in order to issue a merger proposal that is clearly not in the best interest of the companies, and in the long run, the creditors. US Airways is bound to have trouble once this mega-merger begins, and considering that they can't even integrate US and HP today, how in the hell are they going to merge the three carriers with the "new" Delta? US's stock is clearly overvalued, and has only been so high due to speculation that they're going to take over DL. Also, let's not forget the anger that DL employees will exhibit if the merger goes through, DALPA has vowed to stop this merger, and just imagine how much creditors would lose if the whole airline went out of business. The creditors aren't all on board, and Boeing will surely say no, and that's all that's needed.

Jeremy
 
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airzim
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 4:40 am

Quoting WorldTraveler (Reply 7):
the big difference being that DL and NW apparently got alot further than CO and UA did.

and we got this from where?
 
NW748i
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 5:14 am

Quoting WorldTraveler (Reply 15):
But the hearing was called because of US' proposed takeover of DL, not because of DL's talks w/ NW.

Again, I won't dispute that. I don't think you're seeing where I'm going with that statement. Grinstein could inveigle the public, the creditors and so forth by giving various and reasonable impressions about the US/DL arrangement and the options that he is considering (NW). I wouldn't advise him doing that to the Senate, which is already more inclined to his view and lead them to take insult and not as aggressively promote his interests. That seems to be what he has realized and is acting accordingly.
Hail! to the victors valiant, Hail! to the conqu'ring heroes, Hail! Hail! to Michigan the leaders and best! Go Blue!
 
jetlanta
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 5:17 am

Quoting Gigneil (Reply 13):
Yeah, I do. I know that by offering as much money as he has, Parker has put the creditors in a position where they cannot accept a standalone Delta. It does not make any fiscal sense for them.

Delta's only hope was to demonstrate greater value with some other combination. If they are not going to do that, then the creditors are going to go for the proposal with the most cash money.

As an "airline consultant" I would think that the harsh realities of the market would overcome your personal feelings on what Delta is worth.

If you honestly believe that this is how this situation is going to play out, you clearly are not paying attention. The harsh reality here is that Delta's primary creditors are more comfortable with a stand-alone Delta than a US/DL merger. Upon emergence form Chapter 11, those creditors will be owners. They will have every incentive to maximize the value of their investment. If that means a merger, so bit it. But it won't be with US.

Let's wait until the Febuary 1st deadline and see where your prognostication stands.
 
HPRamper
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 5:28 am

Quoting SESGDL (Reply 16):
US Airways is bound to have trouble once this mega-merger begins, and considering that they can't even integrate US and HP today

Why do I keep seeing this? Is there something that I, an employee of the new US, am missing? I think not. The merger is in fact almost complete. The problems have been very publicized (the website issues etc.) but if this complex merger were to be thrown together in a matter of a single month, for instance, the results would have been absolutely disastrous.

Quoting SESGDL (Reply 16):
US's stock is clearly overvalued, and has only been so high due to speculation that they're going to take over DL.

US stock was high before anything regarding DL came up. It has fluctuated a bit, but stock originally was sold at $15 a share, then shot up to around $50 where it has hovered, give or take, ever since. A while back when the DL idea was fresh it went up to around $60 but has since reverted more or less to the norm.
 
db373
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:35 am

Quoting Gigneil (Reply 13):
Yeah, I do. I know that by offering as much money as he has, Parker has put the creditors in a position where they cannot accept a standalone Delta. It does not make any fiscal sense for them.

Delta's only hope was to demonstrate greater value with some other combination. If they are not going to do that, then the creditors are going to go for the proposal with the most cash money.

As an "airline consultant" I would think that the harsh realities of the market would overcome your personal feelings on what Delta is worth.

NS

Obviously certain people haven't read the press releases. Here, let me quote this one for you:

"At the behest of our creditors' committee we recently retained an investment banker to obtain information from Northwest, a far cry from negotiating for a merger with them."

Well, obviously the creditors' committee started this rumor by requesting merger info with NW. Coupled with both the statement a few weeks back from Bethune who said that the NW merger provided a significant alternative to the creditors and with the fact that the creditors negotiated more power in controlling DL's future, I fail to see how they are interested in now turning around and accepting Doug Parker's offer.

Oh, and quick question. Why is the US offer down to $9.8 billion all of a sudden? I could have sworn it was above $10 billion last week. Did US decrease their offer?
Keep Delta My Delta
 
gigneil
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:39 am

I still think I'm right, and most industry analysts agree with me.

As has been suggested, we will see.

NS
 
bucky707
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:49 am

Quoting Db373 (Reply 21):
Why is the US offer down to $9.8 billion all of a sudden? I could have sworn it was above $10 billion last week.

half of Parker's offer was in USAirways stock. So as their stock price drops, the value of the offer falls also. USAirways stock (LCC) is down almost 10% since Parker upped the offer.
 
D L X
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:52 am

Quoting Db373 (Reply 21):
Why is the US offer down to $9.8 billion all of a sudden? I could have sworn it was above $10 billion last week. Did US decrease their offer?

If I'm not mistaken, half of the purchase offer was in LCC stock, which took a fairly substantial dip in the past week.

Quoting Db373 (Reply 21):
"At the behest of our creditors' committee we recently retained an investment banker to obtain information from Northwest, a far cry from negotiating for a merger with them."

Note to WorldTraveller: this does not mean DL has talked to NW. It means that DL has *researched* NW.

It's possible that your source and my source are analogous, and this is a silly argument turning on a word. In other words, it's not worth sorting out who's right on this issue - the important point is that DL isn't negotiating a merger with NW, which was my original point. (Thread titles have to be short - they can't include every word to particularly describe the topic.)
 
D L X
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:53 am

Quoting Bucky707 (Reply 23):
USAirways stock (LCC) is down almost 10% since Parker upped the offer.

Actually, upping the offer made the stock go up. It started to slip when news reports came out that the merger was looking less likely.

Wall Street clearly wants to see this merger, and doesn't believe $10B is too much to pay.
 
bucky707
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RE: Delta Not In Talks With Northwest

Thu Jan 25, 2007 8:56 am

Quoting D L X (Reply 25):
upping the offer made the stock go up. It started to slip when news reports came out that the merger was looking less likely

I don't dispute that. The fact remains, the price now is almost 10% below the price it was when Parker raised the offer.

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