US Airways has made a move this morning to raise their bid for Delta Air Lines by some 20 percent. The new offer adds nearly $1.7 billion dollars to the bid for the bankrupt airline. Both cash offerings and stock options were raised in the new bid for Delta. The new offer is for $5 billion in cash and 89.5 million shares of US Airways, for a total value of $10.2 billion.
Current Market Share Prices of US Airways
This move is to show to Delta creditors that the bid by US Airways is the more lucrative route for them. “We want to remove any doubt and get the process started,” said US Airways president Scott Kirby. This comes as US Airways said it would not increase their offer for Delta but decided earlier this week to proceed with a sizable increase in the offering price.
Recently there has been a battle between Delta and US Airways over the hostile bid takeover. Delta has said it wants to emerge as a stand alone carrier, but rumors have been flying surrounding a Delta Air Lines and Northwest Airlines hook-up. It makes sense after all, they did both file for bankruptcy protection within hours of each other.
US Airways' offer expires Feb. 1st.
This latest up in offering price could pour fire on the already rumor filled airline merger situation. If US Airways is willing to up their offer, who knows what AirTran will do with their offer for Midwest, and the rumors could be flying even more over a Continental/United merger. And that black horse could come out of nowhere and spark other airlines, American, Frontier, Alaska, JetBlue, to link with other airlines.
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