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Delta Evaluating US Airways as Possible Takeover Target (DAL, LCC)

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Delta Air LinesDelta Air Lines Inc. (NYSE: DAL) is looking to acquire US Airways Group Inc. (NYSE: LCC), according to a report by the Wall Street Journal. The Journal, citing people familiar with the matter, reported that Delta is evaluating US Airways Group as a possible acquisition target as U.S. carriers prepare for a fresh round of consolidation.

According to people familiar with the matter, Delta is also evaluating AMR Corp., the parent company of American Airlines for a possible takeover. AMR had filed for bankruptcy back in November last year.


The Journal, citing people with the knowledge of the situation, said that Goldman Sachs Group Inc. (NYSE: GS) and Blackstone Group are acting as financial advisers to the airline.

Delta, which is the world’s No. 2 airline by traffic, has not yet approached US Airways, the people said. Delta’s last acquisition was that of Northwest Airlines back in 2008.

People familiar with the matter told Wall Street Journal that US Airways is open to both, being a buyer or seller, and is expecting Delta to come up with an offer. US Airways, which is the No. 5 U.S. airline, is also considering a possible tie up with AMR. The combination of US Airways and AMR would create an airline that is on par with Delta.

Consolidation in the airline industry is not new and in fact, a number of analysts believe that consolidation is the way forward for the industry.

Delta shares had finished 2.16% higher at $10.39 in trading on Friday. US Airways shares, meanwhile, ended 4.20% higher at $8.18 on Friday.

 

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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