AMR looking at JetBlue
 

Thank you 1193.
There aren't enought negative adjectives to describe what you and the BoB's have done to this pilot group.

AMR to advance with merger review, source says 5 airlines eyed



By Soyoung Kim
NEW YORK (Reuters) - The bankrupt parent of American Airlines said on Tuesday it will press ahead with evaluating potential mergers and will reach out to interested parties, a move set to satisfy some creditors less than impressed with its stand-alone restructuring plan.
A source familiar with the situation said AMR sees itself as an acquirer in potential mergers and at least five airlines -- US Airways Group Inc (LCC), JetBlue Airways Corp (JBLU), Alaska Air Group (ALK), Republic Airways' (RJET) Frontier Airlines, and Virgin America -- will be considered.
Any merger proposals would be weighed against the standalone restructuring plan being developed, the source added.
American has faced mounting pressure from vocal members of its creditors committee, led by its largest labor unions, who have argued that a merger with US Airways would give the combined carrier a strong network to compete with rivals beefed up by their own mergers. US Airways has expressed interest in a merger and has been courting AMR's creditors.
Executives at American, the No.3 U.S. airline, mentioned the five carriers as potential merger candidates at a meeting with its unsecured creditors committee on Tuesday and discussed the merits and challenges of each combination, said the source, who asked not to be identified because the matter is not public.
Chief Executive Tom Horton said in a letter to employees that greater clarity on revenue and the company's cost structure was allowing a review of potential mergers.
"It now makes sense to carefully evaluate a range of strategic options, including potential mergers, which could make the new American even stronger," he wrote.
The letter comes two months after American said it would explore merger options while still in bankruptcy.
US Airways said in a statement it was pleased with the development.
"All we have asked for is a fair and balanced opportunity to present our plan versus others, and we are hopeful this is the beginning of such a process," US Airways said. "We remain confident that our plan will maximize value for all stakeholders."
The source also said private equity firms, other legacy U.S. carriers and even foreign airlines may show interest in a potential deal or investment once American starts the evaluation work.
PROGRESS IN LABOR TALKS
American, which sought bankruptcy protection in November, citing high labor costs, is also taking new steps to stabilize its court restructuring with progress on labor negotiations aimed at achieving more than $1 billion in annual cost reductions, mainly from unions.
The carrier has struck a tentative deal with pilots for cost savings and on Tuesday reached a similar agreement with the final two groups of unionized mechanics and other ground workers. Talks continue with flight attendants.
Horton said American, working together with the creditors committee, would analyze synergies, costs and tax and capital structure implications when looking at potential mergers.
The source said American plans to send out non-disclosure agreements to interested parties in the coming weeks after sharing the documents first with its creditors committee.
He added that the process could continue through the fall.
Horton said he has been a proponent of industry consolidation for many years and the company has assessed many possible combinations in the past, including an acquisition of US Airways. He added that he had also approached his counterparts at other airlines last year to discuss the merits of possible combinations.
But since American's slide into Chapter 11, Horton's view has been that American should first straighten out its own business before considering a "complex and challenging airline acquisition," he said.
"That is just common sense. But it is also a prudent merger strategy, should we take that path, to assure that we begin from a position of greatest strength and stability."
Delta Air Lines Inc (DAL) and Northwest Airlines both emerged from bankruptcies several years ago as stand-alone companies before striking a merger deal with each other. United Airlines also stepped out of Chapter 11 on its own before tying up with Continental Airlines.
American has sought court permission to extend until the end of the year the time it can take to develop a business plan without interference from outside parties. The current exclusivity period expires at the end of September.
AMR's bankruptcy is in re AMR Corp et al, U.S. Bankruptcy Court, Southern District of New York, No. 11-15463.

Highly plausible, although that would force SWA to jump into the ring as well.

How bout a little 6 way merger :eek:

frontier and virgin are money lossing operations...have absoluteley no valuable assets, not even slots...

But they represent capacity that can be purchased then synnergised. In the process, eliminating a ponzi scheme cut throat yield trasher too is an added bonus. Frontier is always for sale, VX may or may not be though, as they have a certain level of immunity from the economics of it all as they are an ego experiment from a Howard Hughes wanna be zillionaire. They could lose billions and it would just be beer money to him. His money makes more money than VX can ever lose.

now sure what good RAH would be to AA, why would AA want Denver and a bunch of RJ units. They seem to be heart felt on spinning off Eagle, why buy more.

C Series slots? I agree it makes the least sense of all their scenarios, but its probably worth it for them to see what they have to offer.

The point of that statement was to take leverage away from Parker.

Maybe they want to look at the other airlines' "books"?

Since they are publicly held companies, these books are available for public or shareholder viewing.

Ummmm no. Wrong books. That was a rumor of why Parker tried to buy DL in BK. He supposedly wanted to see some inside info, in the "books."

They mean Frontier only, not all of Republic.

Makes sense. Always said AMR is the buyer it could by AMR B6 and part of LCC. LCC is the buyer it's parts of AMR and B6.

The wild card is ALK. Will they be brought in or will DAL play spoiler for AMR and LCC and go after assets that one or the other want of the other company. High stakes poker.

"Republic Airways' (RJET) Frontier Airlines"

I think you might have missed the apostrophe and it makes a world of difference.

CSeries slots are not hard to attain, currently Bombardier hasn't seen the or seeders they were hopping for this aircraft coupled with the Q400 having a small list and the CRJ, Bombardier's production lines are close to a stand still. The CRJ line is only producing 5ish aircraft a month. Bombardier could easily find early slots for AMR and if the CSeries debuets as planed (2013) RAB will possibly have to either defer or sell slots since they don't have anyone to fly them for exept the "theory" the rev came up with about flying them for One World, star or sky team!!

I was actually suprised NK was not mentioned...

NK business model is the "ultra low cost carrier" 28 seat pitch, slap stickers like a Vegas cab and cram in the cattle.

AMR bussiness model is the bussiness contracts

This list is likely to show all options are currently being explored but the merging partner(s) have likley been decided.

Jet Blue is an interesting case. They will be cash flow negative for the next few years as they have debt payments due and their maintenance requirements are rising exponentially. The primary value in JB is their brand which they have built up to move away from just low cost but are considered a good airline to fly on. If they are purchased, then the brand goes away and all that is left are some A-320's (I doubt the E-190's would stay) and gates and slots in JFK. As a separate brand they have decent value, as a merger partner they lose most of that value.

Frontier Airbuses to mainline for accelerated S80 retirement and AA feed contract for RAH commuters. Eagle will only be one of several future feed providers with no more then 50% and quite possibly less.

This deal was discussed 2 years ago! What debt does Frontier come with when compared to aquiring new 319's and 321's from Airbus (heavily discounted). Frontier has something like 70 airplanes, how long would it take to rebrand these airplanes compared on taking new deliveries that wont need heavy maintenance for a while! How about the S80 pilots, how does the SLI will look, are the Airbus F9 guys oing to be able to bid other equipment and thus minimizing the gains of havig crews already trained on the Airbus how about relocating the crews since AMR likely would close all the F9 bases! The benefits might not be there for this merger and AA would likely loose most control over their feed and they might not want this!

28" pitch seats can be changed quickly as well as getting "rid" of comp. out of SE FL into the carb/cent/S America.... A320's with more on order.

Not only all that, but what SLI would F9 even bring to the table to begin negotiations anyway? Their current airbus list or the entire Republic "air group" list?

Asset acquisition and offer of employment from RAH a'la TWA. As S80's are parked these buses would be included for displacements. Mixed in with a nice little feed contract for other RAH carriers would relieve RAH's illustrious CEO of his Frontier albatross and prop up his RJ business in one swoop.