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< Quietly making noise | Main | Gary Chaison on the NWA-Delta merger >
What's it mean to me?
Posted at 6:15 PM on April 14, 2008
by Bob Collins
(3 Comments)
Filed under: Northwest Airlines
The merger of Northwest and Delta is a done deal. I'm resisting the urge to go buy Northwest Airlines trinkets to sell 20 years from now on EBay, and instead am turning my attention to monitoring your most pressing questions on the merger. We started this the last time we thought the merger was at hand.
Delta, for the record, took honors for announcing the merger. As of 7:30 p.m., the airline had set up a section on its Web site about the merger. NWA.com, by contrast, had zip.
Submit the questions and we'll do our best to get them answered as details spill out on Tuesday. A news conference is planned for 9:30 a.m.
Here are the main questions submitted so far:
Probably nothing. Delta and Northwest already are partners in the Skyteam alliance. So you can fly on Delta and have points added to your WorldPerks account.
This evening, Northwest sent the following out to WorldPerks members:
You can be assured that your WorldPerks miles and Elite program status will be unaffected by this merger. In addition, you can continue to earn miles through use of partners like WorldPerks Visa®. And once the new Delta Air Lines emerges you can look forward to being a part of the world's largest frequent flyer program with expanded benefits.
You will get 1.25 shares of Delta stock for every share of Northwest stock you own. As of the close of business on Monday, a share of Northwest stock was worth $11.22. Delta closed at $10.48. That's $1.88 premium per share of Northwest stock.
Probably not. One of two cities is more likely to feel the pain: Detroit or Cincinnati, according to Pardus Capital, a hedge fund that owns about seven million Delta shares and was the driving force behind forcing Delta to seek a merger. It said in November that the merger could save $1.5 million a year, mostly by combining hubs. Detroit (Northwest) and Cincinnati (Delta) are two likely candidates to be combined as well as Memphis (Northwest) and Atlanta (Delta).
However, in the announcement -- and you have to take this with a grain of jet fuel -- the new airline said hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Tokyo-Narita, and Amsterdam would be maintained.
It depends on whether the MSP stays as a hub, and early indications -- mostly the plan to keep executive offices in Minneapolis -- are that it will.
Tune in Tuesday. Clearly the new airline is concerned. It's organizing a letter-writing campaign on its Web site.
Gary Chaison, a labor studies professor at Clark University, gives it a 50-50 chance. See interview or just listen to his answer to the question.
This one, of course, is speculation. But airline analyst Robert Mann says a United-Continental marriage will follow soon. That would leave American looking for a suitor.
Comments (3)
What does this mean for Delta's pool of unpaid creditors (in bankruptcy court) still waiting to get compensated for years of waiting? Can go buy new toys, but not pay valid claims?
Posted by John Doe | April 15, 2008 10:12 AM
What does this mean for Delta's pool of unpaid creditors (in bankruptcy court) still waiting to get compensated for years of waiting? Can go buy new toys, but not pay valid claims?
Posted by John Doe | April 15, 2008 10:14 AM
check out: Claims information, claims register...
http://deltadocket.com/
Bankruptcy should be all cleared before something like this merger, eh? But I guess that would be too fair/reasonable to expect....
Posted by John Doe | April 15, 2008 10:21 AM
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