facebook
twitter
rss
account
search
search
 

Delta Air evaluates merger possibilities

Nov. 14, 2007 at 5:22 PM   |   Comments

ATLANTA, Nov. 14 (UPI) -- Delta Air Lines Inc. said Wednesday it was evaluating possible mergers following pressure from a New York hedge-fund investor.

The Atlanta airline, which emerged from bankruptcy April 30 after a hostile takeover attempt by US Airways Group Inc., said it formed a special board committee to evaluate strategic options "to ensure Delta maintains its leadership position in the airline industry, including potential consolidation transactions."

Delta Chief Executive Officer Richard Anderson said Delta had not held talks with United Air Lines Inc. "regarding any type of consolidation transaction and there are no such ongoing discussions."

The Wall Street Journal reported Anderson had held informal talks about consolidation possibilities with counterparts at United, Northwest Airlines Corp. and other airlines.

Hedge fund Pardus Capital Management LP, which holds 7 million Delta shares and 5.6 million shares in United parent UAL Corp., sent a letter to Delta management Tuesday saying it was "imperative" Delta merge with another airline, "given the rapid rise in fuel prices and the increased risk to the business as a standalone entity."

The letter specifically advocated a Delta-United merger.

Anderson said in a statement that "the right consolidation transaction could generate significant value for our shareholders and employees and that strategic options should be evaluated."

With oil at over $90 a barrel, he said Pardus' analysis "takes on a heightened importance."

© 2007 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
Recommended UPI Stories
Most Popular
1
Bad wells, not fracking, spoiling water Bad wells, not fracking, spoiling water
2
Lockheed tests aircraft laser turret
3
Gas onus on Ukraine, Gazprom says Gas onus on Ukraine, Gazprom says
4
Kurds challenge latest Iraqi oil claims Kurds challenge latest Iraqi oil claims
5
Cover Girl ads photoshopped to protest NFL's Roger Goodell Cover Girl ads photoshopped to protest NFL's Roger Goodell
Trending News
Video
x
Feedback