Airbubba
7th Jun 2001, 07:25
Transportation’s Mineta: United-
US Airways merger won’t fly
Expects Justice Department to reject deal
ASSOCIATED PRESS
WASHINGTON, June 7 — Transportation Secretary Norman Y. Mineta said he expected the federal government to reject the proposed United Airlines-US Airways merger.
Mineta did not offer any reasons for his beliefs. He said that even if the United Airlines-US Airways proposal is rejected, other airline mergers could receive federal approval.
The Transportation Department does not approve airline mergers; that role falls to the Justice Department, which has yet to make a decision. Justice officials initially set an April 2 target for completing its antitrust review of the $4.3 billion deal, but have missed the deadline as they review the additional information they asked for.
In addition, United Airlines last month suspended the work of its merger preparation team, though company officials said the employees working on combining the two airlines would resume those tasks later.
If approved, the deal would combine the nation’s second- and sixth-largest airlines and create the largest airline in the U.S., surpassing AMR Corp.’s American Airlines.
Several lawmakers have criticized the proposed deal, saying the combined airline would dominate several key airports. Legislation pending in both houses of Congress would halt all airline mergers while the effects of such combinations are studied.
United spokeswoman Susana Leyva cautioned that the process is not yet completed.
“We have a very complicated transaction, and we’re working with the Department of Justice on that transaction, which we feel is in the best interest of the company, our employees, our customers and our shareholders,” she said.
Nineteen states are investigating the proposed merger, and Minnesota Attorney General Mike Hatch said last month that he would go to court to block the combination if the Justice Department approves it.
“I think it’s a significant enough issue for this country that we should not be permitting that type of concentration in such an important industry,” Hatch said.
In early trading on the New York Stock Exchange Wednesday, shares of United parent company UAL Corp. were up 2 cents to $35.66. Shares of US Airways Group were up 3 cents to $24.28.
US Airways merger won’t fly
Expects Justice Department to reject deal
ASSOCIATED PRESS
WASHINGTON, June 7 — Transportation Secretary Norman Y. Mineta said he expected the federal government to reject the proposed United Airlines-US Airways merger.
Mineta did not offer any reasons for his beliefs. He said that even if the United Airlines-US Airways proposal is rejected, other airline mergers could receive federal approval.
The Transportation Department does not approve airline mergers; that role falls to the Justice Department, which has yet to make a decision. Justice officials initially set an April 2 target for completing its antitrust review of the $4.3 billion deal, but have missed the deadline as they review the additional information they asked for.
In addition, United Airlines last month suspended the work of its merger preparation team, though company officials said the employees working on combining the two airlines would resume those tasks later.
If approved, the deal would combine the nation’s second- and sixth-largest airlines and create the largest airline in the U.S., surpassing AMR Corp.’s American Airlines.
Several lawmakers have criticized the proposed deal, saying the combined airline would dominate several key airports. Legislation pending in both houses of Congress would halt all airline mergers while the effects of such combinations are studied.
United spokeswoman Susana Leyva cautioned that the process is not yet completed.
“We have a very complicated transaction, and we’re working with the Department of Justice on that transaction, which we feel is in the best interest of the company, our employees, our customers and our shareholders,” she said.
Nineteen states are investigating the proposed merger, and Minnesota Attorney General Mike Hatch said last month that he would go to court to block the combination if the Justice Department approves it.
“I think it’s a significant enough issue for this country that we should not be permitting that type of concentration in such an important industry,” Hatch said.
In early trading on the New York Stock Exchange Wednesday, shares of United parent company UAL Corp. were up 2 cents to $35.66. Shares of US Airways Group were up 3 cents to $24.28.