What goes around comes around, eh?
The Wall Street Journal reports that Delta Air Lines is considering a deal to acquire US Airways, almost six years after US Airways attempted to acquire Delta Air Lines in a hostile takeover bid led by Doug Parker, its chief executive officer.
Delta Air Lines was reorganizing under the protection of bankruptcy back in 2006 when US Airways announced its attempt of a hostile takeover of Delta Air Lines. Christopher Muise — who at that time was on The Delta Board Council and was one of many Delta Air Lines employees who did not want to see Delta Air Lines become a part of US Airways — launched the Keep Delta My Delta campaign, which ultimately rallied the entire workforce of Delta Air Lines, as well as politicians, dignitaries, celebrities, companies associated with Delta Air Lines and — most importantly — the customers of Delta Air Lines.
US Airways lost its bid of a hostile takeover, and Delta Air Lines successfully emerged from bankruptcy protection on April 30, 2007. I was on the special flight of Delta Air Lines flight 9998 with service around Atlanta and service from Atlanta to Salt Lake City to Los Angeles on Ship 638 — which is a Boeing 757-200 aircraft that was the first to sport the new livery now currently in use by the fleet of Delta Air Lines aircraft — and “blogged” about the entire experience, which I intend to re-post here at The Gate for those who are interested.
While on that aircraft which flew twice around Atlanta, I sat next to a Delta Air Lines employee. During the taxi of the aircraft before making its way up the ramp towards the runway, the Delta Air Lines employee sitting in seat 41A suddenly wondered aloud, “Imagine if all this was not here.”
It took me a moment to understand and realize what she was saying. Imagine if Delta Air Lines failed to emerge from bankruptcy and went out of business. What would the airport in Atlanta be like without Delta Air Lines?
I replied, “Even worse: what would all of this be like if all of this was US Airways instead of Delta Air Lines,” referring to the failed hostile takeover of Delta Air Lines by US Airways.
Now I will ask the question: what if Delta Air Lines attempted to take over US Airways?
With my limited knowledge about the entire story, I would say that it is a bad idea because:
- From what I understand, the integration between America West Airlines — which US Airways took over several years ago — has been a nightmare and still has not been completed. Delta Air Lines acquiring this potential quagmire would be nothing like its recent yet smooth integration with Northwest Airlines.
- Gerald Grinstein said to me in 2007 while he was still chief executive officer of Delta Air Lines that US Airways was the biggest competitor of Delta Air Lines. If this is still true today, I do not see the approval of the United States government for such an integration.
I could be wrong, but I am not sure how Delta Air Lines would execute a takeover of US Airways any better than US Airways taking over Delta Air Lines. It would be a mess either way, in my opinion. Delta Air Lines might actually be better off pursuing American Airlines as an acquisition target rather than US Airways.
What do you think?
