Business » Companies
Author`s name Dmitry Sudakov

Delta and Northwest Airlines to create world's largest airline with huge problems

To all appearances, there will be a gigantic airline formed in the foreseeable future. USA ’s Delta announced that it agreed to acquire Northwest Airlines. The deal will bring about the world’s largest airline. Its fate has been already determined: boards of directors of the two companies consented to the merger.

Delta experts evaluate the new enterprise at $17.7 billion. The aircraft giant will be headquartered in Atlanta . Delta’s current chief executive Richard Anderson will run the new company.

The merger plans were unveiled about a year ago. At that time the two companies abolished the foreign administration that is stipulated in the US Credit Protection law. However, their merger will be acknowledged as legitimate only after the US antimonopoly administration approves the document.

Analysts believe that even after all red tape problems are solved, the newly-fledged giant will face personnel difficulties when it will have to integrate the labour force of the two companies. Both Delta and Northwest Airlines have their own staff, including top managers, and after the merger they will be demoted or even laid off.

Delta’s standing in the US market seems auspicious against a background of the present crisis: four US small-scale airlines suffered great difficulties within the last weeks. Some of them declared bankruptcy or even closed.

Translated by Julia Bulygina
Pravda.ru