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Battle for Delta heating up

US Airways has sweetened its offer (free registration required) to buy Delta by nearly $2 billion dollars, boosting the overall price tag to just north of $10 billion. The increase also comes with an ultimatum to Delta's creditors: Take it or leave it by February 1.

Delta's pilots and management, for their part, have actively opposed the takeover bid from the start, but the final call really belongs to the airline's creditors—who essentially hold the keys to the kingdom on the bankrupt carrier and can tell it to do whatever they want.

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The New York Times (free registration required), meanwhile, reports that Delta has its eyes on another suitor: fellow bankruptcy buddy Northwest, which would be preferable "because the two airlines' route networks overlap less than with Delta and US Airways. A combination with Northwest is therefore likely to lead to fewer grounded planes, if any."

All well and good, but Delta and Northwest better talk fast if they're serious. The clock's ticking on that US Airways offer.

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