Left At The Alter

Friday, February 2nd
by Shane Bogni

Doug Parker could be cast for Runaway Bride II as his dreams of a shotgun wedding were shatered this week by Delta Air Lines and their official Creditors Committee. While the Committee was issuing a statement in support of Delta's standalone plan, Parker simultaneously withdrew is hostile take over bid. Parker who approached Delta back in August about a possible hook up, made his first of two bids for Delta in November. Most industry experts believed that his proposed takeover attempt had little chance to succeed until a second offer was made in January. However, momentum started to shift in Delta's favor following hearings last week in Washington D.C.

Appearing at a packed hearing before the Senate Commerce Committee Wednesday, Delta Air Lines CEO Gerald Grinstein said both workers and consumers will suffer if US Airways' takeover bid for Delta succeeds. The tone of the meetings suggested that there were serious concerns in the Capital over airline mega mergers and the potential impact in communities and consumers. Industry Analyst Ray Neidl once gave Parkers' bid a 50/50 shot, but following the Senate hearings last week, Neidl changed his stance by saying "people are really doubting this deal is going to happen." Neidl said his sense is that creditors would prefer to let Delta emerge from bankruptcy as an independent carrier, something that could take place as soon as April, giving them stock in the new carrier that they can cash out in the current strong environment for airline shares.

Six institutions: J.P.Morgan, Goldman Sachs & Co., Merrill Lynch, Lehman Brothers, UBS, and Barclays Capital gave Delta a huge vote of confidence this week by providing $2.5 billion in exit financing. The announcement made by CFO Ed Bastian on Tuesday cast even more doubt that US Airways proposal would come to fruition. Parker who gave the Creditors Committee a February 1st deadline to respond favorably to his offer was rumored to be considering increasing his bid for a third time.

So what went wrong for Parker???

Delta won the battle of public opinion - clear and simple. Grinstein has been the CEO of two airlines and a railroad, but he is trained as a lawyer - and oh by-the-way, he once served as chief counsel of the Senate Commerce Committee — the one raking Parker over the coals Wednesday. Another key was an employee led grass roots effort called "Keep Delta My Delta." The effort paid off big as they were able to muster support from hundreds of thousands of people in all 50 states and 105 countries. At the Senate hearings last week, employees delivered more than 104,000 signatures opposing US Airways bid for Delta. Also key, was 16 "Keep Delta My Delta" rallies, not only in big cities like Atlanta and Washington, but perhaps more importantly in places like Baton Rouge, La., Tampa Fl., Butte, Mont., Columbia, S.C., and Jackson, Miss. The issues raised at these rallies like jobs, competition, consumer choice and increased fares are bread and butter concerns - issues people are passionate about. At the end of the day, Parker was schooled by a savy business man/lawyer who knew how important public opinion would be.

Whether or not consolodation will take place in the industry is unclear. But one thing is for certian, Wednesday's endorsement from the Creditors Commitee was a huge victory for Delta. It ensures they will emerge from bankruptcy this spring as a standalone carrier. Congratulations to Gearld Grinstein and to the people of Delta. You have earned the right to keep Delta Air Lines, your airline...

It's Official: Us Airways Withdraws Bid For Delta as Creditors Committee Back Delta's Standalone Plan

PRESS RELEASE: US Airways Withdraws Offer for Delta Air Lines
TEMPE, Ariz., Jan. 31 /PRNewswire-FirstCall/ -- US Airways (NYSE: LCC) today withdrew its offer to merge with Delta Air Lines Inc. (OTC: DALRQ). The airline was informed earlier today that the Official Unsecured Creditors' Committee would not meet its demands by the airline's established deadline of Feb. 1, 2007. As previously announced, US Airways' offer of $5.0 billion in cash and 89.5 million shares of US Airways stock would have expired on Feb. 1, 2007, unless there was affirmative support from the Official Unsecured Creditors' Committee for commencement of due diligence, making the required filings under Hart-Scott-Rodino, as well as the postponement of Delta's hearing on its Disclosure Statement scheduled for Feb. 7, 2007.
US Airways Chairman and Chief Executive Officer Doug Parker stated, "We are disappointed that the Committee, which has been chosen to act on behalf of all Delta creditors, is ignoring its fiduciary obligation to those creditors. Our proposal would have provided substantially more value to Delta's unsecured creditors than the Delta stand-alone plan. We would have created a better and more financially stable airline that offered more choice to consumers and increased job security to its employees. Our merger would have been able to be consummated in a reasonable time-frame and we would have been able to obtain all requisite regulatory approvals.
"The publicly traded bonds of Delta have fallen precipitously since rumors of this Committee decision were leaked last week, reducing the implied market valuation of what Delta's unsecured creditors can expect to recover in these cases by over $1.5 billion. We empathize with the investors who purchased Delta bonds at increasingly higher prices since our offer was announced last November and thank them for their support of our proposal and their confidence in our team. It is now clear that there will not be an opportunity with the Committee to move forward in a timely or productive manner and as a result, we have withdrawn our offer."
Mr. Parker added, "At US Airways, we are extremely confident in our own stand-alone plan. Earlier this week, we announced a 2006 profit (excluding charges) of over $500 million, far and away the best performance by a network airline. Our employees will share $59 million of well-deserved profit sharing payments as a result. Looking forward, we expect even higher earnings and a higher profit sharing pool in 2007. Our 35,000 employees are doing a wonderful job of transforming US Airways and we are committed to building the best airline we can for them. I can't thank them enough for their support, encouragement, and professionalism during this process. I am very proud of how our entire team performed."



(LCCG)
SOURCE US Airways
NEWS RELEASE
For Immediate Release: Contact: Daniel H. Golden
January 31, 2007 212.872.8010


STATEMENT OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF DELTA AIR LINES, INC. ET AL.
The Official Committee of Unsecured Creditors ( the "Creditors’ Committee") of Delta Air Lines, Inc. and its affiliated debtors and debtors-in-possession ("Delta") announced today that it has determined that it will support the standalone plan of reorganization as finally agreed upon between Delta and the Creditors’ Committee that will be filed later this week (the "Plan"). The Creditors’ Committee reached this determination after engaging in extensive discussions with representatives of Delta and US Airways over the last two months and upon consideration of the advice of the Creditors’ Committee’s legal, financial and industry advisors. In reaching this decision, the Creditors’ Committee considered a variety of factors, including, but not limited to, valuation of, the timing and the risks associated with, and the likelihood of a successful consummation of the US Airways proposal and the Plan. The Creditors’ Committee intends to work collaboratively with Delta towards confirmation and consummation of such Plan.
There will be no further comment from the Creditors’ Committee at this time.

US Airways Meger Hopes Fade

January 31st

Source: Airwise
The prospect of imminent airline industry consolidation faded on Tuesday as US Airways reported no headway in its bid to take over bankrupt rival Delta Air Lines.
US Airways Chief Executive Doug Parker said his airline's nearly USD$10 billion bid for Delta is firm and that he has no intention of extending the February 1 deadline for Delta's official committee of creditors to respond. "We have given a deadline of February first (to) the official committee," Parker said. "They know exactly what they have to do, and they know if they don't do it, our proposal is gone."

Investors had hoped a US Airways-Delta deal would lead to more takeovers in the sector, which would cut competition and give surviving carriers an opportunity to raise fares.
Airline shares dropped across the board, even after US Airways and discount rival JetBlue Airways reported quarterly profits, as oil prices jumped, heralding higher costs.
Parker dismissed as "speculation" reports that the airline would increase its USD$9.7 billion bid for Delta. He said recent talk that US Airways has increased its offer by USD$1 billion is inaccurate and that he has not asked US Airways' board to increase the bid. Delta's management has resisted US Airways, saying that Delta is worth more as a stand-alone company and that a merger presents serious antitrust violations. Delta said on Tuesday it had lined up six major Wall Street banks for USD$2.5 billion in financing when it exits bankruptcy.

Delta claimed that support by the banks indicated Wall Street approval of its plan to exit bankruptcy as a stand-alone carrier. Parker made his comments after US Airways reported a quarterly profit, reversing a year-ago loss. US Airways also reported a profitable 2006, its first full year since the 2005 merger of US Airways and America West. JetBlue also reported a fourth-quarter profit, as both airlines benefited from strong travel demand and higher ticket prices. "All the work they've done in turning those airlines around is starting to pay dividends," said Calyon Securities analyst Ray Neidl. US Airways reported fourth-quarter net income of USD$12 million, compared with a year-earlier loss of USD$261 million.

The year-ago loss was made worse by a large fuel-hedge loss and some merger costs. JetBlue also posted a quarterly profit, but forecast a loss in the first quarter on rising costs. The seven-year-old airline has reined in growth by delaying deliveries of some aircraft and selling others. It has also raised fares at the expense of filling seats as it seeks to improve earnings.

These efforts helped JetBlue return to profit in the fourth quarter, reporting net earnings of USD$17 million, compared with a loss of USD$42 million a year ago.Despite the improvement, JetBlue forecast a loss in the first quarter, expecting a pretax margin of negative 4 percent to negative 2 percent. It said unit costs were expected to rise 6 percent to 8 percent. Analysts had expected a profit of 9 cents per share.

Bipartisan Group of Senators to Push for US Airways to Restore Employee Pensions

During last weeks Senate Hearings in Washington D.C., US Airways CEO Doug Parker was criticized for terminating employee pensions and the long term impact on the PBGC. Senators asked Parker if a merger with Delta was approved, would he restore the terminated pension program. Parker paused for a moment and stated - "no." That was not the answer many of the elected officials gathered there last Wednesday were looking for. Today, a bipartisan group of Senators sent a letter to the head PBGC asking him to explore the possibility of restoring the terminated pension program at U.S. Airways. Read more below.


Letter to PBGC asks Agency to Consider Restoring U.S. Airways Employee Pension Program Tuesday, January 30, 2007

WASHINGTON, D.C. - Last night, United States Senator Frank R. Lautenberg (D-NJ), along with a bipartisan group of his colleagues, sent a letter to the head of the Pension Benefit Guarantee Corporation (PBGC), asking him to explore the possibility of restoring the terminated employee pension programs at U.S. Airways, in light of the airline’s substantially improved financial circumstances. The employee pension plans, which were under funded by $4.8 billion at the time of their termination, have since been assumed by the PBGC. By law, PBGC has the authority to take such action if a company’s financial situation is improved. Earlier this month, US Airways offered to purchase the larger Delta Airlines for some $10.2 billion, including $5 billion in cash. “If US Airways now clearly has ability to generate considerable cash and has easy access to credit markets, the company’s ability to restore its terminated pension plans must be fully explored. This is especially true in light of the fact that PBGC regulations would permit the restored plans to be funded over a period of up to 30 years, which is an even longer funding period than airlines are afforded under the Pension Protection Act of 2006,” the lawmakers wrote. “The Federal government shouldn’t allow a company that dumped its pension responsibilities buy another,” said Lautenberg. “US Airways should take care of its employees before taking over another airline.” Senators Johnny Isakson (R-GA), Maria Cantwell (D-WA), Saxby Chambliss (R-GA), and Patty Murray (D-WA) also joined

Breaking News: Delta Air Lines Secures $2.5 Billion Exit Financing

Tuesday January 30th
by Shane Bogni

Delta Air Lines Secures $2.5 Billion Exit Financing (Note 'Standalone')
Delta Airlines (DALRQ-NASDAQ/OTC) has announced this morning that it secured a $2.5 Billion exit financing facility, making it one step closer to exiting bankruptcy in spring as a strong well-capitalized standalone carrier.

Six institutions led the facility: J.P.Morgan, Goldman Sachs & Co., Merrill Lynch, Lehman Brothers, UBS, and Barclays Capital. The pact will consist of a $1 billion first-lien revolving credit facility, a $500 million first-lien Term Loan A, and a $1 billion second-lien Term Loan B. The facility will be secured by substantially all of the first-priority collateral in the existing debtor-in-possession facilities. Proceeds from the facility will be used by Delta to repay its $2.1 billion debtor-in-possession credit facilities led by GE Capital and American Express, to make other payments required upon exit from bankruptcy, and to increase its already strong cash balance.

The company said it has reduced its cost structure with what will be the lowest unit cost of major carriers, sees a 2007 debt reduction from $17 Billion down to $7.5 Billion, sees liquidity at $2.6 Billion in unrestricted cash, and sees a Blackstone estimated consolidated equity value of $9.4 Billion to $12 Billion upon exiting Chapter 11.

Now the main question holders need to know: What will happen to the common stock in the exit of Chapter 11? Also they are going to resist takeovers maybe no matter what, or at least that is their indication. The word STANDALONE appears 6-times in their press release today.

Industry Experts See Little Chance for Mega Mergers

Industry experts say the recent retreat in airline stock prices despite strong financial results is due in part to the growing opposition to US Airways hostile takeover bid for Delta Air Lines. It appears Doug Parker, while valiant in his effort, has failed to gain the necessary support from Delta creditors as it faces deadlines this week and next. The Wall Street Journal reported Monday that US Air is willing to increase its hostile takeover offer for Delta Air Lines Inc. by adding $1 billion in cash under certain conditions and giving creditors a termination fee in case regulators block the deal. Most insiders see the increase as a last-ditch effort by Parker.

Industry Analyst Ray Neidl agrees that recent declines in US Airways shares are due at least partly to growing pessimism by investors about it being able to win the necessary support of its Delta bid. "People are really doubting this deal is going to happen," he said. "The creditors are leaning away it."Neidl said his sense is that creditors would prefer to let Delta emerge from bankruptcy as an independent carrier, something that could take place as soon as April, giving them stock in the new carrier that they can cash out in the current strong environment for airline shares. Neidl said Delta's emergence from bankruptcy would be pushed back a minimum of six months if creditors convinced the bankruptcy court and Delta management to take the US Air offer. And antitrust regulators could delay it even longer than that, if they approve it at all.If the Feb. 7 bankruptcy hearing is held, it will be a victory for Delta management, which hopes to win approval of its reorganization plan from the court and the creditors as soon as possible.

Breaking News: Parker ready to increase bid by $1 billion as last-ditch effort

Here we go again... Doug Parker, CEO of US Airways will reportedly increase his hostile take over bid for Delta Air Lines for a second time. Just a few days before a February deadline that suggests Parker will withdraw his offer if he has not won the support of the creditors committee, is reportedly ready to increase his offer by $1 billion. This time the sweetened deal comes with strings attached. Sources suggest that Parker will increase his offer "if" the official creditors' committee will ask a bankruptcy judge to postpone a hearing next week on Delta's restructuring plan and support the start of a formal antitrust review. Oh by the way, did I mention that Parker said emphatically that he wouldn't increase his offer back in November??? Parker also imposed a February 1st deadline but is there really a deadline? Stay tuned...

One industry analyst characterized Parkers' move as "desperate." "The fact is, the once very confident Parker, sees the chances of his dream marriage dwindling." This comes after senate hearings last week where Parker answered questions around job losses, decreased service and increased fares. Several reports also surfaced last week that suggested the creditors committee has grown skeptical of the proposed merger although there has been no official comment from the committee. "The committee has two real concerns: regulatory hurdles that the combined carrier would have to overcome and the debt load the merger would leave behind." The increased offer doesn’t address those concerns and therefore won’t make much of a difference in my opinion. At the end of the day, the committee will choose a plan that has the greatest chance to succeed and US Airways proposal leaves to many questions unanswered.

US Airways Bid for Delta Hits Turbulance

Gerald Grinstein contacted the "fat lady" yesterday following Senate Hearings in Washington D.C. It appears she has been asked to sing a song now that US Airways hostile bid is about as likely as you running into Osama Bin Laden at your local Supermarket. Witnesses could hear her warming up last night in Atlanta. It is not clear what song she will be singing but what is clear is Doug Parker's hostile bid for Delta Air Lines is loosing altitude. What was also clear from Wednesday’s hearings is that Delta has overwhelming support for their standalone plan as they presented 104,851 e-petitions signed at http://www.keepdeltamydelta.org/ opposing US Airways' hostile takeover attempt. Delta people then delivered the signatures to Senate offices. Additionally, more than 155,000 letters of opposition have been sent to members of Congress and the Administration.

Appearing at a packed hearing before the Senate Commerce Committee Wednesday, Delta Air Lines CEO Gerald Grinstein said both workers and consumers will suffer if US Airways' takeover bid for Delta succeeds. Grinstein called the hostile takeover plan a "flight of fancy" that would saddle the resulting company with tens of billions of dollars of debt that he felt would, despite assurances to the contrary, make furloughs unavoidable. The debt load from the combined companies could skyrocket to more than $24 billion. That alone will probably be enough to persuade the creditors committee that Delta's standalone plan presents the greatest value. Several reports surfaced this week that suggested the creditors committee has grown skeptical of US Airways proposal although they have made no official comment. It's unclear what Parker will do next. He is on record as saying that his offer would be withdrawn on February 1st if the creditors committee had not given its approval. Although it us not clear what Parkers next move will be, it was obvious his plan was dealt a serious blow on Wednesday when almost no one testified in favor of his proposal. One industry analyst said that Parker would be best served to withdraw is proposal and move on. I couldn’t agree more.

Witnesses diss Delta takeover -- and mergers in general

Witnesses diss Delta takeover -- and mergers in general
Pacific Business News (Honolulu) - 7:21 PM HAST Wednesday

by Howard Dicus

The prospect of Delta Air Lines being acquired by US Airways appear dim after almost no one testified in favor of it at a Senate hearing Wednesday.

A high-profile hearing of the Senate Commerce Committee, chaired by Sen. Daniel Inouye (D-Hawaii) and playing to a standing room only audience that included Delta pilots in uniform, featured assurances by US Airways CEO Doug Parker that were met with skepticism by airline industry analysts who also testified, and by senators themselves.

"We will not furlough any frontline employees of Delta or US Airways as part of this merger," Parker testified. "We will align the work group cost structures between current US Airways and Delta employees, and going forward we will move to the higher cost scale."

But Delta CEO Gerald Grinstein called the hostile takeover plan a "flight of fancy" that would saddle the resulting company with tens of billions of dollars of debt that he felt would, despite assurances to the contrary, make furloughs unavoidable.

"The stage is set for Delta to emerge as a powerful, competitive force to be reckoned with," Grinstein said. "Our company will emerge from bankruptcy as a formidable global competitor. Delta doesn't need to be acquired."

The Bush administration took a measured view. Andrew Steinberg, assistant secretary of transportation for aviation, said the White House does not automatically assume that industry consolidation is bad for consumers, but does not consider mergers a panacea for industry problems.

Senators on the committee, not including any from Delta's home state of Georgia, mainly seemed worried that the merger could lead to service cuts to their own home states. Some analysts who testified said mergers can tie up management without solving problems that stem from cost structures. And the Consumer Federation of America said airline mergers would be bad for fliers.

"Mergers like US Airways-Delta will result in rising prices and reduced service because they eliminate competition on thousands of routes where there are already too few competitors to prevent price gouging and abuse of market power," said Mark Cooper, the federation's director of research. "The hostile takeover of Delta by US Airways should be rejected."

Doug Parker had earlier said that the advantage of a US Airways acquisition of Delta was that the two both had heavy route networks in the Caribbean and across the Atlantic and could eliminate duplicative service without cutting service to any destination.

Gene Kimmelman, vice president for federal and international affairs of the Consumers Union, said market power needs to be analyzed on a market-by-market basis since it is lack of competition at the point of sale that triggers abuse.

"We have not opposed every merger that has come down the runway," he said, "but the current mergers between major airlines clearly have massive anticompetitive effects."

Kimmelman predicted that mergers will mean more work for Congress because market forces will stop holding air fares down and lawmakers will need to look for statutory or regulatory solutions.

Delta Air Lines flies to Hawaii from Atlanta, Cincinnati and Salt Lake City, none of which have nonstop service to Hawaii by any other carrier, and it among the many airlines flying nonstop to Hawaii from Los Angeles. US Airways flies to Hawaii from Phoenix and several California cities.

Battle for Delta Lands on Capital Hill

At a rally today on the U.S. Capitol grounds in anticipation of Wednesday’s Senate Commerce Committee hearing, Delta pilots, board council members, retirees, employees, and elected officials, announced that as of this morning more than 104,851 people have signed a petition on the KeepDeltaMyDelta.org site opposing US Airways’ hostile takeover attempt of Delta. Additionally, more than 155,000 letters have been mailed to members of Congress and the Bush administration voicing opposition to the merger proposal.
“For more than 60 years, Delta Air Lines has thrived as a leading employer of countless Georgians and has established itself as an economic engine for the Southeast,” said Senator Saxby Chambliss (R-Ga.) during the rally at the Capitol. “Delta has met its challenges head-on and these hard-working folks deserve the opportunity to follow through with their plans to emerge as an independent company. I am pleased that my colleagues on the Senate Commerce Committee have scheduled this hearing to ensure that the content and potential effects of this proposal are carefully examined.”
Delta Board Council members along with active and retired Delta employees also are personally delivering that message to congressional representatives on Capitol Hill in Washington, D.C. today to urge their support of an independent Delta. The group will call on senators from 32 key states that would be affected if US Airways’ unsolicited merger proposal is approved. They are providing senators with information outlining Delta’s reasons for opposing the merger, notably its anticompetitive aspects.

Battle for Public Opinion Begins

On Wednesday, Delta began placing newspaper ads in a dozen cities thanking those communities for the support they showed Tuesday following Delta's Plan of Reorganization announcement. The ads, featuring an open letter from Jerry Grinstein, appeared in the Atlanta Journal-Constitution; Cincinnati Enquirer and Post; Salt Lake City Tribune and Deseret News (also in SLC); Augusta Chronicle; Tallahassee Democrat; Montgomery Advertiser; The State in Columbia, S.C.; Charleston (W. Va.) Gazette; Harrisburg Patriot-News; Albany (N.Y.) Times-Union; Boston Herald; and the Raleigh News & Observer.

Please visit keepdeltamydelta.org to sign an e petition and show your support for Delta's standalone plan. Thank you!

Delta Rallys Public Opinion

Delta Air Lines wooed supporters from Capitol Hill to City Hall Tuesday as it launched a battle in the court of public opinion against a hostile takeover with rallies held at the Cincinnati/Northern Kentucky International Airport and in eight other locations. The events were aimed at generating grassroots support for Delta as it fights to stave off a hostile takeover by US Airways. They took place the same day that Delta filed a reorganization plan in bankruptcy court that the Atlanta-based airline says is better for creditors than the deal US Airways is proposing.
While a decision in bankruptcy court could be months away, Delta gathered key allies at Tuesday's rally at Cincinnati/Northern Kentucky. "I am opposed, categorically opposed, to a hostile takeover of Delta Air Lines," U.S. Rep. Geoff Davis told a room filled with uniformed Delta employees, airport workers and political, civic and business leaders who had come to take part in the employee-led campaign, dubbed "Keep Delta My Delta."

"If this merger were to come to pass - it comes down to satisfying a group of institutional shareholders who invest in Wall Street or the families and the employees of this company who have worked so hard, I side with the families because the economics are there," said the Hebron Republican. The economics he and several other speakers spoke of are those that have made the airport the No. 1 driver of Greater Cincinnati and Northern Kentucky's economy with an annual impact estimated at $5 billion. With Delta and its Comair subsidiary providing 80 percent of the flights, the futures of Delta and Cincinnati/Northern Kentucky, the airline's second largest hub, are interlocked.

Davis said he fears if US Airways succeeds in forcing the merger with Delta, it would abandon Cincinnati/Northern Kentucky as a hub in favor of one it already has in Philadelphia. And because US Airways has committed to its own regional carriers not to downsize, cutbacks of regional jets called for in its plan would likely come out of Comair, he said.
"And that can mean only one thing: the effective end of Comair. And I oppose that because that's our homegrown airline here in Northern Kentucky, which is also profitable and having a huge impact on the region," Davis said. Cincinnati Mayor Mark Mallory also expressed concern that a U.S. Airways takeover of Delta would mean the end of Cincinnati/Northern Kentucky as a hub.
"A hostile takeover by US Airways upon Delta would not be good for the city of Cincinnati, would not be good for the state of Ohio, would not be good for the state of Kentucky and would not be good for the United States of America," Mallory said. "Ladies and gentlemen, we must do everything within our power to oppose this hostile takeover." Ellen Van der Horst, president of the Cincinnati USA Regional Chamber, and Steve Stevens, president of the Northern Kentucky Chamber of Commerce, spoke of the impact a merger with US Airways would have on the 10,000 businesses the two organizations represent. Van der Horst forecast a "significant reduction" in flights from the airport if US Airways succeeds in its takeover and that would have a negative impact on the ability to attract and retain businesses and jobs to the region, she said.
Stevens talked about the major impact that spending by employees of Delta and Comair has on the local economy. If the bankruptcy court decides in favor of US Airways' takeover, the cutbacks that would follow would curtail that spending.

"This is not a good decision for Delta and threatens this hub. It cannot be a good decision for Northern Kentucky or Greater Cincinnati," Stevens said. Dan Lincoln, president of the Greater Cincinnati Convention and Visitor's Bureau, and Tom Caradonio, president of the Northern Kentucky Visitor's Bureau, warned that loss of a hub would harm the region's tourism and hospitality industry and the 70,000 people it employs. Morgan Durrant, spokesman for US Airways, said in a phone interview after the rally that the Tempe, Ariz.-based airline was aware of rallies at Cincinnati/Northern Kentucky and elsewhere. "We understand that some Delta employees probably have mixed feelings about our proposal based on what they may be hearing from management and hearing from the community," Durrant said. "But we are confident as employees of Delta understand the stability that this merger would create that they'll come to support it."

He said the airline remains committed to operating Cincinnati/Northern Kentucky as a hub although there could be some service changes. He anticipates lower fares just as has happened in a number of other markets the airline serves. As for Comair, he said it was too early in the process to say what the Erlanger-based regional carrier's status would be if the US Airways-Delta merger takes place.

"We're still on course," Durrant said. "We want to get in front of the creditors committee and conduct due diligence. That's where our focus is." The creditors committee, made up of representatives of companies the airlines owe, will make a recommendation on the merger proposal to U.S. Bankruptcy Judge Adlai Hardin, who has the final decision. Joseph Kolshak, executive vice president and chief of operations for Delta, stressed that consumers will come up short if the US Airways takeover succeeds. "Here's what's at stake for consumers and communities across the country. Stated simply: Fewer travel choices, limited service and higher fares," Kolshak said.

He said that since US Airways merged with America West last year, in every market where U.S. Airways has lowered fares, it has raised fares in four others. US Airways' fares have increased nearly twice as much as those of other legacy carriers, he said. After the presentations and a chance for people to sign an oversized petition in opposition to the takeover, Kolshak said gathering public support is important to the airline and its employees, which had similar rallies Tuesday in Atlanta; Augusta, Ga.; Boston; Charleston, W.Va.; Columbia, S.C.; Harrisburg, Pa.; Salt Lake City and Tallahassee. "I think we have to be very clear and make sure everyone realizes that this is not a good deal. It isn't a good deal for Ohio, Kentucky. It's not a good deal for Cincinnati. It's not a good deal for Delta (and) Delta people. And when you look at it globally, it's not a good deal for the traveling public," he said. He said Delta is making a case for its reorganization plan with the creditors committee in bankruptcy court, but garnering public support is also important. Stevens said the reason that residents of Greater Cincinnati and Northern Kentucky should rally behind Delta is simple: the airport hub operation and the some 10,000 jobs it supports. He acknowledged that local passengers have a longstanding grievance with Delta over the fares it charges at Cincinnati/Northern Kentucky, which are among the highest in the nation. "It is obviously a situation that is something we would like to see improve, but as unhappy as we are with airfares that are higher than our competitors, we would be more unhappy if these jobs left us," Stevens said.