US Airways Firm about Delta Offer; CEO Clarifies Remarks

US Airways called for Delta Air Lines' directors and creditors to "fully and fairly" evaluate its $8.6 billion takeover bid and reiterated Wednesday its commitment to pursue the controversial deal.

Some airline analysts had concluded the acquisition was falling apart when US Airways CEO Doug Parker was quoted in USA Today on Wednesday morning saying his carrier would abandon the hostile takeover if Delta wasn't convinced of its benefits. Parker's comments were made during a Tuesday meeting with the newspaper's editors and reporters.

"We have to get to a point where all are working together on this or it's not going to happen," Parker said in USA Today. "This is all about convincing Delta's management that this plan makes sense."

On Wednesday afternoon, however, Parker issued a written statement proclaiming US Airways is "fully committed" to purchasing Delta and calling for the Atlanta-based airline's board and creditors to move to a detailed study of a combined operation.

Parker didn't deny telling USA Today that US Airways would only pursue a consensual deal. But a US Airways spokeswoman said Parker's written statement was meant to clear up "misperceptions the article may have caused."

Also Wednesday, Delta pilot union leaders met outside US Airways' vacant former headquarters in Arlington, Va., to emphasize the job losses they say would hit Atlanta if Delta is sold. US Airways abandoned the office building when it was purchased by American West, which adopted the US Airways brand.

"I want them to understand exactly what a hostile takeover means --- and they get it," said Capt. Lee Moak, head of the Air Line Pilots Association at Delta. "It's bad for employees, communities and customers. It's only good for corporate raiders --- and they're not going to succeed here."

US Airways estimates merging with Delta will save $1.65 billion a year and cut overlapping routes. But Moak disputed that figure and said Justice Department regulators are almost sure to reject any Delta/US Airways merger.

"[US Airways] glossed over the Delta pilot contract which prohibits many of the synergies they think they'll get," Moak said. "Our contract alone will kill this merger. This merger will not succeed."

Moak said pilots met late Wednesday with lawmakers in Washington to drum up opposition to a Delta sale.

Robert Mann, an airline analyst, said Parker's published comments about winning Delta approval were probably meant to ease fears among Delta employees.

"It makes it a lot easier to put employee groups together if a deal is consensual," Mann said. "He feels like he's got the best plan, and in Chapter 11 the best economic plan wins at the end of the day."

Adam Pilarski, airline analyst at Avitas, said he first interpreted Parker's comments as a sign he was abandoning a takeover attempt.

"I couldn't figure it out," Pilarski said. "It sounded like an admission of defeat, that he was giving up. Maybe he was extending the olive branch to labor, but the whole thing was very strange."

Parker's statement Wednesday afternoon was meant to dispel such notions.

"We believe that the next steps, in order for Delta's board of directors and creditors committee to satisfy their respective fiduciary obligations to fully and fairly evaluate the potential benefits of our proposal, is to begin the due diligence process," Parker said. "We are absolutely determined to take the necessary steps to move the process forward."

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