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Old Posted Nov 16, 2006, 8:26 AM
ski82 ski82 is offline
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Join Date: Apr 2006
Posts: 350
Ultimately, this probably won't go through because of SEC and congress pressure. The overlap of routes will elimate too much competion and the new airline would have about 10% more marketshare than any other carrier. The leaders of the House (I think) Transportation Committee was on CNBC today and did not see to enthusiastic about the deal. Right now, however, the investment institutions have the reasorces and are probably really pushing it and who knows how much power they actually have...not enough to get through a democratic congress, I think. Delta not wanting any part of the deal makes things harder as well. I don't know what US Air's financial situation is like, but given the industry, I would think they would need some LBO action... considerably more risky for the banks.

That being said, I think you will see more mergers like the American West - US Air one. They make sense and will help the industry. No real growth in the large airlines until the number of passengers catches up to supply and supply will not change without a large merger like this one or one of the airlines liquidating.

My $.02.
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