Delta-Northwest is a go: Justice Department

The Justice Department announced today that its Antitrust Division has found that “the proposed merger between Delta and Northwest is likely to produce substantial and credible efficiencies that will benefit U.S. consumers and is not likely to substantially lessen competition.” This clears the way for Delta and Northwest to merge officially. It was not an [...]

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Would a Northwest Chapter 11 filing help its merger case?

J. P. Morgan has updated a report assessing the liquidity and balance-sheet health of U.S. airlines, and it finds Northwest Airlines second most likely to file for reorganization under Chapter 11 bankruptcy. If you’ll recall my introduction to airline antitrust, the Justice Department looks more kindly on a merger if one of the parties is [...]

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1978, 2008

[Alfred] Kahn and the [Civil Aeronautics Board] were facing not just one but three airline mergers in the summer of 1978. In addition to the battle for National, Continental Airlines and Western Air Lines had filed for approval to merge, and two local service carriers — North Central Airlines and Southern Airways — also wanted [...]

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Airline credit ratings . . . crunch!

The main — and really only — important reason for publicly held airlines to merge is to increase the value for investors. The idea in the industry is that a theoretically well-designed merger will increase this value, which is why big airlines are pursuing tie-ups so ardently. Along comes Moody’s to throw a well-deserved wrench [...]

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The toxic tango of United and US Airways

Now that Continental has turned down suitor United, the latter is weighing a desperation move: merging with US Airways to create the world’s new largest airline (surpassing Delta-Northwest, assuming that goes through). The airlines may announce a tie-up within the next fortnight. Therefore, it’s time for another Merger Mania 2008 antitrust evaluation.
As you’ll remember from [...]

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“All things are lawful. . .”

“. . . wrote St. Paul, ‘but not all things are profitable.’ And so it is with the proposed merger of Delta Air Lines and Northwest Airlines.”
My new op-ed on the Delta-Northwest merger is up on American.com.

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The NWA legacy

Joke circulating among Northwest pilots: “They’re going to incorporate elements of both corporate identities in the merger. From Delta, we get ‘Delta.’ From Northwest, we get ‘Airlines.’”

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All politics is local: liveblogging the Delta-Northwest hearings

Notes: I am leaving out redundant passages, which often occur in congressional hearings. Unless something is in quotation marks, it is a paraphrase of what a speaker is saying. Editorial comments are so noted.
The antitrust task force of the House Judiciary Committee is having a hearing to assess airline competition and the proposed merger between [...]

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Anderson and Steenland to hit the Hill

Delta CEO Richard Anderson and Northwest CEO Doug Steenland will be on Capitol Hill Thursday to testify before the following congressional panels:

House Judiciary Committee, Antitrust Task Force, April 24, 10:30 a.m., Rayburn 2141.
Senate Judiciary Committee, Subcommittee on Antitrust, Competition Policy and Consumer Rights, April 24, 2:00 p.m., Dirksen 226.

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Some random numbers on Delta-NWA

From Mike Boyd’s weekly update:
7,100+
Based on an independent Airports:USA analysis, the number of overlapping markets technically represented by the merger of Delta and Northwest, defined as city pairs where a consumer can possibly book either carrier.
14
Out of the top 100 overlapping markets, the number (other than routes connecting existing DL/NW hubs) where the combined market [...]

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