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US Airways Group, Inc. Message Board

  • teknowiz teknowiz Aug 13, 2013 4:20 PM Flag

    LCC is much better off without merger

    LCC is paying through the nose to AMR shareholders and AMR bondholders valuing itself much lower
    The merger synergies would take years to come to fruition if at all.
    LCC has the best balance sheet among all majors.

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    • LCC - US Airways is much better off without a merger. US Airways is profitable, and they are doing it by charging less than American Airlines is. In my opinion, this is a very bad and risky deal for LCC shareholders. In all likelihood, we are going to see another downturn in the US economy in 2 years or less. When that happens, air travel will be greatly affected, with less money per household, means less money for travel. Businesses forced to trim their spending also won't be spending money on employee travel. US Airways is already positioned to weather the storm. A Bloated American Airlines after a merger with USA, will have a very difficult time trying to survive in another downturn economy. I'm really surprised at US Airways for trying to pull this off. The same management who runs USA ran America West Airlines before they merged with US Air. The old America West went to not 1, but 2 bankruptcy filings in less than 10 years apart.

      You should all know that due to the arrogance of US Airways management, they are already starting to incorporate some of the horrible paperwork and procedures at American Airlines, into the business operations over at US Airways. It's bad, and after reviewing AA's procedures, paperwork and management, it's no surprise as to why the company is in serious financial trouble. Now ask yourselves, if this didn't for AA, why would anyone think it will work for US Airways or a newly merged AA and USA?

      I seriously doubt that either airline will be successful at thwarting the federal and state governments from blocking the merger. It's not good for business, the states, and it's especially not good for the consumers. Remember investors, don't by on hype. If you do buy or hold, do so because your did your exhaustive due diligence like I did. I think US Airways will be just fine without the merger. American Airlines will survive on their own, provided they kick their current sorry management to the curb.

      Sentiment: Hold

    • If you were correct I do not think lcc would be down 13% today. LCC needed this merger for long term viability imo...short term lcc should do well but I am not sure the market will ignore the long term implications. Best case scenario imo would be if another airline would buy lcc but DOJ will not permit DAL or UAL to buy LCC so it would have to be a smaller airline and I do not have a clue who that would be if anyone or if DOJ would ok it.

    • I agree. Takeovers rarely work well. AMR is BK for a reason.

    • I agree. They should just buy both Frontier and Hawaiian

 
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