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S&P: US Airways on developing watch
Standard & Poor's said it placed its ratings on US Airways Group Inc., including the B- corporate credit ratings on US Airways Group Inc. and its major operating subsidiaries America West Holdings Corp., America West Airlines Inc. and US Airways Inc., on CreditWatch with developing implications.
The agency noted that the CreditWatch placement is based on the company's November proposal to merge with Delta Air Lines Inc. (rated D), under which the companies would combine upon Delta's emergence from bankruptcy, expected in the first half of 2007.
The proposal offers $8 billion in cash and stock to Delta's unsecured creditors, using $7.2 billion of committed credit facilities to fund the $4 billion cash portion of the offer and to refinance various existing debt, S&P said.
If US Airways is successful in completing the merger with Delta and realizing these synergies, ratings could be raised modestly, the agency added.
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