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The New Media Department of The Post and Courier
FRIDAY, FEBRUARY 02, 2007 7:06 AM

Delta is not for merging

Mississippi Sen. Trent Lott found a picturesque way to oppose the bid for a decidedly hostile takeover of Delta Air Lines by US Airways when he said of the Arizona carrier: "You're an aggressive suitor, but the lady from the South doesn't want to be forced into this shotgun wedding." But there was much more than Southern pride at stake in shooing away US Airways Group.

A statement by the creditors' committee for Delta Airlines, rejecting the $9.8 billion takeover offer, said in prosaic language why such a shotgun wedding would not lead to a happy partnership: "The risks and time required for a successful merger were too great." With that, on Wednesday, US Airways withdrew its offer.

Delta's creditors were in agreement with the Atlanta-based airline's CEO Gerald Grinstein, who described the proposed takeover as "blatantly anti-competitive," and a "poster child of the worst kind of merger." Mr. Grinstein argued convincingly that Delta's business model has been transformed and that the carrier expects to emerge from Chapter 11 bankruptcy in the spring as "a strong, healthy, and vibrant global competitor."

Delta, as was to be expected of a Southern Lady, won many hearts as she refused to give in to her unwelcome suitor. Her admirers in Charleston played a significant role in responding to her plight. As The Post and Courier's Kyle Stock reported, a group of Lowcountry Republican lawmakers showed their concern by holding a rally at Charleston International Airport. State Rep. Bobby Harrell, who is speaker of the House, pointed out that while all the legislators at the rally were in favor of market-based economies, their objection was the virtual monopoly the merger would create. They noted that Charleston International is one of 10 U.S. airports with the highest fares in the country. Rep. Harrell warned before the deal was rejected that combining Delta and US Airways, which handle 69 percent of passenger traffic from Charleston, would ensure that air fares go skywards.

Sen. Lott's appeal to chivalry obviously did not sway US Airways. They made a market decision after hearing from the creditors, who put their own money on the line in refusing to give their approval to a forced marriage.


This article was printed via the web on 2/9/2007 11:19:18 AM . This article
appeared in The Post and Courier and updated online at Charleston.net on Friday, February 02, 2007
.