- The Washington Times - Wednesday, November 15, 2006

1:44 p.m.

US Airways Group Inc. proposed an $8 billion takeover of bankrupt Delta Air Lines Inc. today after an attempt at merger talks failed earlier in the fall.

The offer, which US Airways said would create the largest trans-Atlantic carrier, is the latest move by Chief Executive Doug Parker, who orchestrated the May 2005 takeover of bankrupt US Airways by America West and has pushed for consolidation in the industry.

Mr. Parker said a merger with Delta, which has been operating in Chapter 11 bankruptcy protection since September 2005, should be compelling to Delta’s creditors.

“We just believe this is a better plan, and we want to get it on the table to the creditors,” Mr. Parker said. “We believe once they understand this alternative plan, they’ll prefer it.”

US Airways has obtained $7.2 billion in committed financing for the deal from Citigroup.

However, Delta’s management has said it isn’t interested in the offer.

In a prepared statement issued this morning, Delta Chief Executive Gerald Grinstein said the airline’s goal is to emerge from bankruptcy during the first half of 2007 as a stand-alone carrier.

“We received a letter from U.S. Airways this morning and will, of course, review it,” he said, adding that “our plan is working, and we are proud of the progress Delta people are making to achieve this objective.”

In morning trading, US Airways rose $6.75 at $57.68 on the New York Stock Exchange, and Delta was up 9 cents to $1.56 in over-the-counter trading.

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