JetBlue to Pass on American Buyout
Aug 21st 2012 7:13AM
Updated Aug 21st 2012 9:35AM
JetBlue Airways Corp. (NASDAQ: JBLU) will not be one of the bidders for the assets of bankrupt AMR, parent of American Airlines. That does not leave the crippled airline without a suitor. U.S. Airways Group Inc. (NYSE: LCC) has repeatedly said it would like to create a "merged" company to compete with United Continental Holdings Inc. (NYSE: UAL) and Delta Air Lines Inc. (NYSE: DAL), which have gained scale because of mergers of their own. The lack of a second bidder could bring down the price at which the assets are sold. But AMR has become more attractive since it went into Chapter 11. Aside from the traditional benefits of cuts in debt and plane leases, the firm has gotten most of its unions to agree to contracts that favor the carrier. Flight attendants recently came to an agreement, which leaves pilots as the only group not to settle. According to Bloomberg:
After being identified by AMR last month as likely to get a non-disclosure agreement, JetBlue has held no talks with the larger airline about a combination, Chief Executive Dave Barger said yesterday in an interview at Bloomberg's headquarters in New York.
"We have not received a non-disclosure agreement," he said. "We're not interested in receiving a non-disclosure agreement from American Airlines."
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, Airlines, Mergers & Acquisitions Tagged: DAL, JBLU, LCC, UAL