United may be poised to join the fray over a possible merger with Delta, according to a recent Reuters report.
Industry analysts say United’s route network is a better complement to Delta’s, and United has begun hinting at a possible merger. “We believe mergers in the airline industry have significant synergies, and we believe the industry needs to consolidate,” United’s chief financial officer, Jake Brace, said on Wednesday. “We’re going to do what makes sense for our company, and we’ll be interested to see what happens with US Air and Delta.”
Meanwhile, Gerald Grinstein, Delta’s CEO responded to US Airways’ proposal on Wednesday in a statement saying, “Delta’s plan has always been to emerge from bankruptcy in the first half of 2007 as a strong, stand-alone carrier. Our plan is working and we are proud of the progress Delta people are making to achieve this objective. The Bankruptcy Court has granted Delta the exclusive right to create the plan of reorganization until Feb. 15, 2007. We will continue to move aggressively towards that goal.”
Reuters reports that shares of American, Continental, and Northwest are up, riding high on expectations that the airlines might also soon join in merger talks. Keep an eye out for more merger news in the coming weeks.
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