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.
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