This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Airline Industry Needs M&A Chatter

American + US Airways

No doubt a potential merging of American (AMR) and US Airways (LCC) is a live one , awaiting the resolution of just a single problem: American has no interest. It has so little interest that it even violated its longstanding policy of not commenting on potential mergers to make its lack of interest clear.
American and US Airways

Okay, maybe this is just a ruse to get the price of the deal down.

It's true that down the road, US Airways could be involved in a merger. At least, this is what US Airways Doug Parker has said. Parker has been a key player in all of the recent industry mergers.

First, ATA, unable to make a deal with US Airways predecessor America West in 2004, sold Midway slots to Southwest. Then Delta shunned US Airways to merge with Northwest. Then United shunned US Airways to merge with Continental.

For anyone truly interested in predicting airline mergers, the trick will be to find out what carrier US Airways is eyeing as a partner and then figure out what other company that carrier might merge with.

JetBlue + Everyone

Airline watchers long for the days of merger speculation involving JetBlue (JBLU - Get Report) and Delta (DAL), which flourished despite JetBlue management's insistence in 2007 that it had no desire to merge with anyone. Instead, JetBlue is today partners with everyone.

Everyone, that is, except for Delta.

Southwest + Sun Country

Stifel Nicolaus analyst Hunter Keay has found a potential merger to write about. In a recent report, Keay mused about a merger between Southwest and the privately-held, Minneapolis-based Sun Country.

This deal has every possible synergy:
  • Southwest began flying to Minneapolis in 2009 and has been growing there; an acquisition would enable more growth.
  • Southwest flies 737s, Sun Country flies 737s.
  • Southwest wants to grow internationally; Sun Country flies to Mexico, the Caribbean and London/Stansted.
  • Southwest has $3.7 billion sitting around, probably drawing 0% interest, just like our CDs.
  • Plus, Sun Country currently resides in bankruptcy court -- ground zero for airline merger speculation.

    Keay emphasized that he has no knowledge of any talks; he just thinks the idea is an interesting one.

    The airline industry, which loves merger speculation, owes him its thanks.

    -- Written by Ted Reed in Charlotte, N.C.

    >To contact the writer of this article, click here: Ted Reed
    2 of 2

    Check Out Our Best Services for Investors

    Action Alerts PLUS

    Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

    Product Features:
    • $2.5+ million portfolio
    • Large-cap and dividend focus
    • Intraday trade alerts from Cramer
    Quant Ratings

    Access the tool that DOMINATES the Russell 2000 and the S&P 500.

    Product Features:
    • Buy, hold, or sell recommendations for over 4,300 stocks
    • Unlimited research reports on your favorite stocks
    • A custom stock screener
    Stocks Under $10

    David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

    Product Features:
    • Model portfolio
    • Stocks trading below $10
    • Intraday trade alerts
    14-Days Free
    Only $9.95
    14-Days Free
    Dividend Stock Advisor

    David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

    Product Features:
    • Diversified model portfolio of dividend stocks
    • Updates with exact steps to take - BUY, HOLD, SELL
    Trifecta Stocks

    Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

    Product Features:
    • Model Portfolio
    • Intra Day Trade alerts
    • Access to Quant Ratings
    Real Money

    More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

    Product Features:
    • Access to Jim Cramer's daily blog
    • Intraday commentary and news
    • Real-time trading forums
    Only $49.95
    14-Days Free
    14-Days Free
    LCC $0.00 0.00%
    JBLU $25.46 2.90%
    LUV $46.95 2.30%
    AAPL $117.24 -0.90%
    FB $107.00 2.60%


    Chart of I:DJI
    DOW 17,841.72 +121.80 0.69%
    S&P 500 2,095.91 +15.50 0.74%
    NASDAQ 5,144.7860 +36.12 0.71%

    Free Reports

    Top Rated Stocks Top Rated Funds Top Rated ETFs