Northwest Announcing Merger

[falmouth3 Senior Member Find all posts View Profile Close falmouth3]

As a valued Northwest Airlines customer and WorldPerks® member, I wanted you to be among the first to hear that we have announced a merger with Delta Air Lines. Subject to regulatory review, our two airlines are joining forces to create America’s premier global airline which, upon closing of the merger, will be called Delta Air Lines.

By combining Northwest and Delta, we are building a stronger, more resilient airline that will be a leader in providing customer service and value. Our combined airline will offer unprecedented access to the world, enabling you to fly to more destinations, have more flight choices and more ways than ever to earn and redeem your WorldPerks miles.

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.

The combined Delta Air Lines will serve more U.S. communities and connect to more worldwide destinations than any global airline. Our hubs – both Delta’s and Northwest’s – will be retained and enhanced. We will be the only U.S. airline to offer direct service from the United States to all of the world’s major business centers in Asia, Latin America, Europe, Africa and around North America.

Both airlines bring tremendous strengths to this new partnership. Our complementary service networks form an end-to-end system that is truly greater than the sum of its parts. This is a merger by addition, not subtraction, which means all of our hubs – both Northwest’s and Delta’s – will be retained. In addition, building on both airlines’ proud, decades-long history of serving small communities, we plan to enhance global connections to small towns and cities across the U.S.

All of these positive benefits of our combination mean that we can:

* Offer a true global network where our customers will be able to fly to more destinations, have more schedule options and more opportunities to earn and redeem frequent flyer miles in what will become the world’s best and most comprehensive frequent flyer program.
* Continue to serve our current roster of destinations and to maintain our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo.
* Improve our customers’ travel experience, through new products and services including enhanced self-service tools, better bag-tracking technology, more onboard services, including more meal options, new seats and refurbished cabins.

While we work to secure approval of our merger, which may take up to 6 to 8 months, it will be business-as-usual at both airlines. We will continue to operate as independent airlines and the people of Northwest will remain focused on providing you with the very best in safe, reliable and convenient air travel. At the same time, both airlines will be planning for a seamless integration of our two airlines, one that delivers to you the enhanced benefits that will earn – and retain – your preference.

As we work through this process, we will keep you informed at every step along the way. Thank you for your business and we look forward to serving you on your next Northwest flight.

Sincerely,

Bob Soukup
Managing Director, WorldPerks

[vintner Super Moderator Find all posts View Profile Close vintner]

As someone living in the home state of NWA, it has met with lots of news on the local tv station. The Gov is going to do this or that depending on how the deal comes out. The main thing is, for us in Minnesota, we have spend a lot of money for repair bases in Northern Mn. NWA was supposed to pay us taxpayers back. NWA has its headquarters here. It looks as we are going to loose everything. Jobs will move out for some positions, but Delta has announced that some positions will stay here.

This is (supposed) to make a stronger airline with better operations and even an increase in employees.

[PigsDad Senior Member Find all posts View Profile Close PigsDad]

This is (supposed) to make a stronger airline with better operations and even an increase in employees.

...in India.

Kurt

[falmouth3 Senior Member Find all posts View Profile Close falmouth3]

ATLANTA - Delta Air Lines Inc. and Northwest Airlines Corp., squeezed by record high fuel prices and a slowing economy, are combining in a stock-swap deal that would create the world's biggest carrier. The boards of both companies gave the deal the go-ahead Monday.

Delta said the combined airline, which will be called Delta, will have an enterprise value of $17.7 billion. It will be based in Atlanta, and Delta CEO Richard Anderson will head the combined company.

Under the terms of the transaction, Northwest shareholders will receive 1.25 Delta shares for each Northwest share they own. The exchange ratio represents a premium to Northwest shareholders of 16.8 percent based on Monday's closing stock prices.

Delta Chairman Daniel Carp will become chairman of the new board of directors and Northwest Chairman Roy Bostock will become vice chairman. Delta President and Chief Financial Officer Ed Bastian will retain his titles.

The new board will be made up of 13 members, seven of whom will come from Delta's board, including Anderson, and five of whom will come from Northwest's board, including Bostock and Doug Steenland, the current Northwest CEO. One director will come from the Air Line Pilots Association, the union that represents pilots from both carriers.

There will be an unspecified number of job cuts or transfers through the consolidation of overlapping corporate and administrative functions, Delta said. The two airlines employ more than 80,000 people combined. The company expects no involuntary furloughs of front-line employees and said the existing pension plans for both companies' employees will be protected.

Delta doesn't plan to close any of the two airlines' hubs.

Delta also said that it has agreed with its pilot leadership to extend its existing collective bargaining agreement through the end of 2012. The agreement, which is subject to pilot ratification, will allow the combined company to realize the revenue synergies of the transaction, Delta said. It also provides the Delta pilots a 3.5 percent equity stake in the new company and other enhancements to their current contract.

The agreement does not cover Northwest pilots.

Delta said it will use its best efforts to reach a combined Delta-Northwest pilot agreement, including resolution of pilot seniority integration, prior to the closing of the merger.

U.S.-based non-pilot employees of both companies will get a 4 percent equity stake in the new airline when the deal closes, Delta said.

Northwest pilots and the union representing most of Northwest's ground workers immediately announced they would fight the combination.

Dave Stevens, chairman of the Northwest branch of the Air Line Pilots Association, said in a prepared statement, "The risk to Northwest Airlines and to the Northwest pilot group from letting this merger proceed, as it is now structured, is simply too great."

Northwest didn't consult with the union that represents its baggage handlers, ramp workers and ticket agents, said Joseph Tiberi, a spokesman for the International Association of Machinists and Aerospace Workers.

"If the airline wanted the support of their employees they should have brought us in and discussed it with us earlier," he said.

Lee Moak, head of Delta's pilots union, said Delta hopes cooler heads will prevail.

"It takes two to fight," Moak told The Associated Press. "We don't see a fight here. We see a cooperative relationship with the Northwest pilots to bring everybody to parity as soon as possible."

The two pilots unions were unable to agree on integrating seniority lists before the combination was announced. A joint contract they had reached was never consummated.

The announcement comes a year after the two carriers emerged from Chapter 11 bankruptcy protection. Both carriers are losing money again but are in much better shape than the four much-smaller airlines that have filed for bankruptcy or gone out of business in recent weeks.

The deal will need antitrust approval, and integrating the work forces of fully unionized Northwest and Delta, where pilots are currently the only major unionized work group, will be tricky.

The joining of Atlanta-based Delta and Eagan, Minn.-based Northwest, if approved by regulators and shareholders of both companies, will result in combined annual revenue of $31.7 billion, vaulting it ahead of Fort Worth, Texas-based AMR Corp.'s American Airlines for the top spot in the U.S.

It would be the biggest carrier in the world in terms of traffic, before any further domestic capacity cuts and any divestitures that might be required by antitrust regulators.

The agreement comes after several months of merger discussions between Delta and Northwest and at one time between Delta and Chicago-based UAL Corp.'s United Airlines. Analysts believe a Delta-Northwest combination will stand up better to regulatory scrutiny because the two carriers have less overlap, even though a Delta-United combination could create more scale and have greater synergies.

Years of mounting losses forced Delta and Northwest to file for bankruptcy protection in New York on Sept. 14, 2005. Both emerged from bankruptcy as leaner carriers last spring, after shedding billions in costs during their reorganizations.

While in bankruptcy, Delta fended off a hostile takeover bid by Tempe, Ariz.-based US Airways Group Inc.

Delta said its plan to remain on its own would create more value than US Airways' $9.8 billion bid, which Delta argued would not pass regulatory hurdles. The value argument never materialized, as Delta's post-emergence market capitalization started out $1 billion less than US Airways' bid and less than the $9.4 billion to $12 billion Delta projected. Its market value has fallen precipitously in the months since amid airline industry woes, including high fuel prices and a general inability to gain traction raising ticket prices.

Many analysts predicted an eventual Delta-Northwest merger after Anderson, a former Northwest CEO, was named last August to be the chief executive officer of Delta.

Anderson, who was Northwest's CEO from 2001 to 2004, immediately sought to quiet those suggestions, telling Delta's pilots union chairman the morning his appointment was announced that he believed in Delta's standalone plan and that "he was not coming in as CEO to facilitate a merger with Northwest."

But eight months later, that's what Anderson is doing, and many analysts believe he didn't have a choice amid plummeting airline market values and soaring fuel prices.

Wall Street and some airline executives have pushed for consolidation for years, arguing that too many seats are chasing too few passengers. The resulting discounting has made it hard for airlines to cover their expenses.

However, Northwest and Delta overlap relatively little in the U.S. — which could actually help them gain antitrust approval. Delta's routes are strongest in the eastern U.S. and to Latin America and Europe. Northwest would complement that with its near-lock in the Midwest along with flights to its Tokyo hub and other points in Asia.

Northwest's Asian routes have been one of its main appeals to other carriers. It and United are the only two U.S. carriers with the rights to pick up new passengers in Japan and fly them farther into Asia. Delta and Northwest also complement each other internationally because they are both part of a marketing alliance that includes Air France-KLM.

U.S. airlines get the majority of their revenue from domestic service, though that trend has shifted in recent years as more carriers, particularly Delta and Northwest, have sought to increase international service.

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

This is absolutely dreadful news for all air passengers, and particularly NW frequent flyers.

If this merger stands, it is likely to trigger at least one other airline merger, possibly UA and CO, and result in a significant reduction in competition in the airline industry, and the resulting oligopoly will bring with it significantly higher fares. The US could end up with only three major carriers and a lot less competition.

Air travellers need to flood the regulators and Congress with letters opposing this merger. For solid reasoning on why airline mergers hurt the travelling public, they need, ironically, to look no further than the recent testimony of former Delta CEO Grinstein on the proposed US Airways takeover of Delta.

As to members of NW's Worldperks ff program, the most customer-friendly of the ff programs of domestic carriers, if DL just gives them Skymiles, the least customer-friendly of the ff programs of domestic carriers, on a one for one basis, they face a huge devalution, for a number of reasons. On use of miles, Delta is the king of imposing junk fees to raise the cash cost of an award ticket. Its worst is one recently imposed on passengers originating in Europe and intended to be taken systemwide in the future in which fuel surcharges are treated as taxes and imposed on award tickets. On one recent example on a route where this policy is already imposed, I was quoted less than US$100 by NW in taxes and fees for an award ticket but over US$330 by Delta. And that was before DL announced some new junk fees that would push the cash cost of that award ticket to nearly US$400. Similarly, domestic first class upgrades for elite members are much more widely availible on NW than on DL. On the earning side of miles, lowest tier elites would see their bonus miles slashed from 50% to 25%, and highest tier elites would see their bonus miles slashed from 125% to 100%.

But even that might be better than what might be coming down the pike. Air France, one of the most customer-unfriendly airlines in the world, is investing a billion dollars in this merger and getting a seat on the board. They are likely to be the thousand pound guerrila on the board and bring their philosophy on massive devaluation of ff programs. Instead of just getting the inferior SkyMiles program (appropriately called SkyPiles by some), we may see a brand new, even more inferior ff program imposed on both WorldPerks and SkyPiles. This is exactly what Air France did when they took over KLM. The resulting Flying Blue is but a pale ghost of what the predecessor programs, Frequence Plus and Flying Dutchman, used to be. Both had been good programs, but FLying Blue is so bad, it is not even worth the bother of joining for most leisure travellers. Indeed there are some rumors out there that both Worldperks and SkyPiles will simply be folded into Flying Blue. There is apparently a precedent where a South American airline has combined its ff program with Continental. Some language in one of the official communiques has been pointed out on FlyerTalk that actually implies a merger of both ff programs into Flying Blue, which would be the worst of all worlds for ff members.

While this merger would mean that NW CEO Steenland gets to pocket a $10 million payout and the organizations of board members of both airlines get to churn the stock they got as former bankruptcy creditors in an anticipated merger euphoria illusion boomlet, it would be the merger from hell for NW passengers and the travelling public generally.

If one has Worldperks miles, it is time to BURN BABY BURN while they are still worth something and not wait for them to turn into a pumpkin with the ''new DL''.

[falmouth3 Senior Member Find all posts View Profile Close falmouth3]

Delta SkyMiles letter

As a SkyMiles® member, you know how important convenient worldwide connections are to your business and leisure travel plans. That's why we are excited to announce that Delta is merging with our SkyTeam® partner Northwest Airlines to create America's premier global airline.

You've long known Delta and Northwest for our many customer and network strengths—Delta as the largest airline across the Atlantic and a leading carrier on the Eastern Seaboard; and Northwest as a leading U.S. carrier to Asia, Canada and throughout America's heartland. We're proud to bring these complementary networks together in a combination that better connects your hometown to the globe.

The combined airline, which will be called Delta, will offer unprecedented access to the world. You will be able to fly to more destinations, have more schedule options and more opportunities to earn and redeem miles in what will become the world's largest frequent flyer program. Once we bring our operations together, we will serve more U.S. communities with convenient connections to more worldwide destinations than any other global airline. And we will be the only U.S. airline to offer direct service from the United States to the world's major business centers across Asia, Latin America, Europe, Africa and the Middle East.

Delta will combine the individual strengths and complementary service networks of both airlines, which today focus on different parts of the country and the world. This will enable us to:

Offer continued access to more than 390 worldwide destinations in 67 countries with no hub closures.
Strengthen global connectivity from each of our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo-Narita.
Accelerate the upgrading of existing international aircraft with lie-flat seats and personal on-demand entertainment.
Improve customers' travel experience through new products and services, including enhanced self-service tools, better bag-tracking technology, new seats and refurbished cabin interiors.
Have the opportunity to exercise options for delivery of up to 20 widebody jets between 2010 and 2013 to provide more international service than ever before.
While the merger is undergoing review, which is expected to be completed later this year, it will be business as usual at both airlines, and we are committed to maintaining the same industry-leading customer service and focus on safety you have come to expect from us. Once the transaction closes, any operational changes will be clearly communicated to all customers worldwide, and I assure you that we are taking steps to ensure a seamless transition.

For more information about the merger, please visit newglobalairline.com.

Thank you for being a loyal SkyMiles member. We look forward to serving you on your next Delta flight—anywhere in the world.

Sincerely,

Richard Anderson
Chief Executive Officer

[4ARedOctober Super Moderator Find all posts View Profile Close 4ARedOctober]

Huh......I don't get it......

Delta, Northwest to create largest airline

By Kyle Peterson and Jui Chakravorty Das
Tue Apr 15, 6:12 AM ET

Delta, Northwest to create largest airline - Yahoo! News

NEW YORK (Reuters) - Delta Air Lines Inc will buy Northwest Airlines Corp for more than $3 billion under a proposal unveiled Monday to create the world's biggest airline, as carriers seek to counter skyrocketing fuel prices and a weak economy.

After racking up $35 billion in losses and finally emerging from a five-year slump in 2006, U.S. airlines are hoping mergers could lead to higher fares as combined carriers reduce flights and use their increased market power to raise prices......


.......Initially, the deal will remove no capacity from the system because Delta and Northwest currently have very little overlap in their routes......


......The deal will combine Delta's strong Atlanta hub and its trans-Atlantic route network with Northwest's extensive Asian presence, including a hub in Tokyo. There will be no hub closures, Delta said.....

[Jya-Ning Silver Contributor Find all posts View Profile Close Jya-Ning]

That probably mean the international fly fair will be skyrock for people like me that has family in other side of earth.

Jya-Ning

[jericap Super Moderator Find all posts View Profile Close jericap]

Rcvd via email today:

Over the last few years you've been one of Delta's most active supporters. From our efforts to reject a hostile takeover attempt in 2006 to our bid to gain rights to serve China in 2007, you've been there.

Now, we're writing to let you know about Delta's plans to merge with our SkyTeam partner Northwest Airlines to create America's premier global airline.

The Delta-Northwest combination creates a new paradigm for consolidation within the airline industry with benefits in sharp contrast to other mergers that have been proposed. This merger is based on addition, not subtraction, and combines end-to-end networks that open a world of opportunities for our customers and employees.

In fact, the merged airline will combine the individual strengths and complementary service networks of both airlines, which today focus on different parts of the country and the world. This will enable us to:

Offer continued access to more than 390 worldwide destinations in 67 countries with no hub closures.


Improve global connectivity from our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo-Narita.


Accelerate the upgrading of existing international aircraft with lie-flat seats and personal on-demand entertainment.


Improve customers' travel experience through new products and services, including enhanced self-service tools, better bag-tracking technology, new seats and refurbished cabin interiors.


Build a stronger airline for our employees - the new airline will provide employees with greater job security, an equity stake in the combined airline, and a more stable platform for future growth in the face of significant economic pressures from rising fuel costs and intense competition.
You can learn more about why this merger is good for employees, customers and the communities we serve by visiting us at Delta and Northwest: Creating America's Premier Global Airline. At the Web site, you can also make your voice heard on why you believe Delta's plan to create America's premier global airline is one that's in best interest of airline customers.

Thank you in advance for your support.


www.NewGlobalAirliine.com

Wow, They already have a new website!!!

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

DL was hurting, having bet on $65 oil in its business plan. NW has the best cash position of any domestic legacy airline and a much better fleet renewal situation with fuel efficient aircraft either already in service or coming. DL is trying to grab a lifeline to cover for their own mismanagement.

The next one coming is probably UA and CO, now that NW's ''golden share'' in CO is useless. Mergers will greatly reduce competition, and passengers will get hosed on fares. Consumers need to raise our voices loud against these monopolistic moves in the airline industry. There is some indication that the regulatos may consider all mergers together, which should increase the chances of rejection and also run out the clock into the next administration, which should be more favorable for consumers.

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

DL was hurting, having bet on $65 oil in its business plan. NW has the best cash position of any domestic legacy airline and a much better fleet renewal situation with fuel efficient aircraft either already in service or coming. DL is trying to grab a lifeline to cover for their own mismanagement.

The next one coming is probably UA and CO, now that NW's ''golden share'' in CO is useless. Mergers will greatly reduce competition, and passengers will get hosed on fares. Consumers need to raise our voices loud against these monopolistic moves in the airline industry. There is some indication that the regulatos may consider all mergers together, which should increase the chances of rejection and also run out the clock into the next administration, which should be more favorable for consumers.

[Carolinian Super Moderator Find all posts View Profile Close Carolinian]

Hers where to write to oppose this merger, which will decrease competition and raise air ticket prices for all:


antitrust.atr@usdoj.gov