It's news to me...I hadn't heard about it previously and am wondering if anyone over at HP/AAA have?
here's an article (I need to get the RSS feeds up and running again)...
http://news.yahoo.com/s/nm/20061115/...usair_delta_dc
dunno what this means for everyone but there's even talk over on JC about this being a "hostile takeover"...
here's the article in the Atlanta Journal that talks about it...
--How a hostile takeover might work
By MARGARET NEWKIRK
The Atlanta Journal-Constitution
Published on: 11/15/06
A hostile takeover is never simple. But when the company being sought is in bankruptcy, it gets even more complicated. Jack Williams, a Georgia State law professor and bankruptcy expert, describes what US Airways faces in its $8 billion unsolicited bid for Atlanta-based Delta Air Lines, which is operating under federal bankruptcy court protection. Right now US Airways can begin to acquire the distressed debt of Delta. It can offer a premium over and above what that debt is trading for now, Williams said.
He noted investors already have been buying up Delta's old debt, anticipating a takeover and intending to essentially flip it for a huge profit.
By buying up the debt, US Airways would become the largest creditor.
But that wouldn't give it much immediate leverage. At least until Feb. 15, and probably longer, Delta retains the exclusive right to file a reorganization plan with the federal bankruptcy court in New York that is handling its case. Even Delta's largest creditor can't file a plan on the company's behalf as long as the airline remains in court. Williams said US Airways will make premium offers to creditors, and may even throw a little money on the table for Delta's stockholders, who now stand to get nothing.
"By doing that, they isolate management," he said. "If they can make it look like management is more interested in entrenchment than the best interests of the estate, and the court begins to focus on that, the publicity will start to move in US Airway's favor."
There are two schools of thought about what Delta should do, Williams said. One holds that the management should stay neutral. The other encourages them to weigh in.
Williams said the second is more likely in a bankruptcy, where a judge and bankruptcy trustee can guard against entrenchment. He said bankruptcy precludes Delta from taking some of the evasive actions it might take outside of bankruptcy. For example, a bankruptcy court is highly unlikely to allow the company to damage its own worth in order to make itself less attractive. That's called a scorched-earth strategy and is sometimes to used to discourage suitors. Williams suggested that Delta's management should bring in independent consultants and set up independent boards or committees to weigh offers, in order to stave off accusations of entrenchment.
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Feel free to discuss..I have no idea what to think yet...but man.. can you imagine the seniority fight?? years and years of fighting for that since HP/AAA don't even have it figured out yet!!