The long awaited sale?

[roz]

http://www.marketwatch.com/news/yhoo/sto...8B2B262C51C8%7D

Here's the original article:

Delta in Talks to Sell Subsidiaries
By EVAN PEREZ
Staff Reporter of THE WALL STREET JOURNAL
March 7, 2005 11:09 p.m.

Delta Air Lines is in talks with contract carrier SkyWest Inc. to sell one or both of its regional airline subsidiaries, according to a SkyWest executive.

The third-largest U.S. airline in terms of traffic is still struggling to overcome huge financial losses as it pursues a turnaround strategy that includes a simplified fare structure, cost-cuts and efforts to improve customer service. After reporting a $2.2 billion loss in the fourth-quarter the airline startled investors by revealing it was planning to tap the last of a $1.1 billion cash infusion it received last fall, raising the prospect that, with fuel costs still high, it may have significant cash needs later this year.

Bradford Rich, chief financial officer of SkyWest said Monday at an investors conference said Delta had expressed "more than just an interest" to sell the two subsidiaries, Comair and Atlantic Southeast. SkyWest, based in St. George, Utah, operates regional feeder jets for Delta, mostly out of the carrier's Salt Lake City hub.

"We think we're in the best position of anyone to take advantage of this type of opportunity," Mr. Rich said at the Raymond James Institutional Investors Conference in Orlando, Fla. He didn't specify whether SkyWest was interested in one or both of the carriers and he noted that the discussions were in the early stages. But he said SkyWest's initial view is that it can cut about 5% of the costs of either carrier.

A Delta spokesman didn't return a call seeking comment. A SkyWest spokeswoman said she didn't have additional information to provide.

Delta spent $2.9 billion acquiring ASA and Comair about five years ago, back when the company was swimming in dot-com era profits. While producing badly-needed revenue, and some profitability, the two companies have been problematic for Delta, including a 2001 pilots strike at Comair, and operational and customer-service problems at ASA. Last quarter, the company recorded a $1.9 billion charge related to the estimated fair value of ASA and Comair.

[Kristie]

yup, I heard this over at JC...we'll have to see what happens.

[lucky81698]

Sounds like a nightmare waiting to happen. At least for the employees. Mergers/buyouts aren't fun!

Jan

[roz]

Well you coulda read it here first--and only here posts the original source! [img]images/graemlins/grinning-smiley-044.gif[/img]

SkyWest is not union. So, if this happens, things could get ugly for the Comair/ASA employees.