This is why mergers won't happen

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01-25-2008 | 06:36 PM

#51

JiffyLube

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From: AMR Big one

Quote:

Originally Posted by Lighteningspeed

This mega merger will also streamline regionals, and fewer regionals will survive this trend. For example NWA-Delta merger will not need Comair, Mesaba, Compass, RAH, Skywest and Pinnacle. It will want to consolidate them down to few regional airlines completely owned and controlled by the NWA-Delta. Which one of the regionals will survive is anybody's guess. Same scenario for Delta-UAL merger.

I agree... I think the rj's will hurt the most in these mergers. All the talk is to reduce DOMESTIC capacity, and rj's are the main stay of the domestic fleets. Mainline (at any airline) is spread as thin as can be. Look at the AA-TWA merger, the AX carriers grew to reduce what the 9's, 80's and 717's were doing. I think you will see the major overlaps in a merger will be in the regional feed.

01-26-2008 | 05:54 AM

#52

fireman0174

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From: Retired 121 pilot

Quote:

Originally Posted by MTOP

Saying they'll "sue to stop the deal" is not the same as stopping the deal. There were other factors that stopped that deal.

Yes, like everything in life, there certainly were other factors, but that was the back-breaker. Without DOJ approval, the deal would have faced a huge uphill battle.

There's no question that UAL management at that point wanted out of the deal.

01-26-2008 | 08:09 AM

#53

bigfatdaddy

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Quote:

Originally Posted by fireman0174

Fireman - was the reason for UAL mgmt wanting to back out of the deal a company cultural issue or something business related - hidden costs?

01-26-2008 | 09:34 AM

#54

fireman0174

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From: Retired 121 pilot

Quote:

Originally Posted by bigfatdaddy

Fireman - was the reason for UAL mgmt wanting to back out of the deal a company cultural issue or something business related - hidden costs?

I really think it was because they understood that the deal was not going to produce the results they had hoped for in the merger. Wall Street had become skeptical of the plan, especially considering the $60 a share that UAL was offering for USAir.

Also, the "dot-com" bust was rearing it's head as I recall, and I think company financial projections were really starting to look downward, although that might not have been until early 2001.

The DOJ statement was probably quite welcome by senior management.

01-26-2008 | 11:52 AM

#55

bigfatdaddy

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Thanks, interesting times then and now

02-06-2008 | 08:12 AM

#56

alvrb211

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Mergers have worked for some firms. But statistically, most have failed!

That is a fact!

02-06-2008 | 09:52 AM

#57

newKnow

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From: 765-A

Mergers in this case are not about failing or not failing. They are about making as much money for management as possible before they bail out and run (ruin) a health insurance company or Burger King or something....