Delta Air Lines has ruled out seeking a white knight in favour of filing its own restructuring plan next month to fend off the hostile $8.7 billion (€6.8 billion) merger proposal from US Airways.
Executives at the third-largest US airline have highlighted the execution risks of the US Airways' plan revealed last week, and insist it will progress with the exclusive right to reorganise and exit almost two years of bankruptcy protection in mid-2007 as a standalone carrier.
"We'll come out with a strong plan [in mid-December] that our creditors will view with much more confidence and certainty [than US Airways']," said Ed Bastian, Delta's chief financial officer.
The takeover battle is being closely watched in the industry, and any positive signals from anti-trust regulators could lead to efforts to merge other large carriers such as American or United. Mr Bastian declined to outline details of Delta's proposal, but said there were "no plans" to solicit a white knight or strengthen its balance sheet with capital from a stronger carrier such as Air France-KLM, a SkyTeam alliance partner.
He said Delta was focused on talks with creditors like the federal Pension Benefit Guaranty Corporation, which took on some of Delta's terminated employee plan, and on exit financing.
US Airways made its proposal to creditors after Delta rebuffed merger talks, and has seen the indicative value of the cash and stock rise 8 per cent since the announcement was made on November 15th.
