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Entries in Merger (27)

Sunday
Jul282013

Publicis, Omnicon Merge to Become World’s Biggest Ad Firm

Fuse(NEW YORK)  -- Omnicon and Publicis announced Sunday that they would be merging and creating the largest advertisng company in the world, BBC News reports.

Together, Omnicom, a U.S. firm, and Publicis, a French firm, will be worth $35.1 billion and employee more than 130,000 people. The new Publicis Omnicom Group will be listed in Paris and New York.

John Wren and Maurice Levy, chief executives of Omnicom and Publicis, respectively, will be joint CEOs of the new entity.

"The communication and marketing landscape has undergone dramatic changes in recent years including the exponential development of new media giants, the explosion of big data, blurring of the roles of all players and profound changes in consumer behavior," BBC News reports Levy having said.

"John [Wren] and I have conceived this merger to benefit our clients by bringing together the most comprehensive offering of analogue and digital services," he continued.

Copyright 2013 ABC News Radio

Tuesday
Feb192013

OfficeMax, Office Depot to Merge?

Andrew Harrer/Bloomberg via Getty Images(NEW YORK) -- Office supply chains OfficeMax and Office Depot may soon become one, reports the Wall Street Journal.

People familiar with the matter tell the newspaper that both retailers are in "advanced talks to merge" and could make an announcement as early as this week.

While specific details have not yet been revealed, sources say the deal, which could still fall through, is expected to be stock-for-stock.

Spokespersons for both companies told the Journal they "don't comment on rumors or speculation."

Copyright 2013 ABC News Radio

Monday
Feb182013

Pros and Cons of an American and US Airways Merger

Andrew Harrer/Bloomberg via Getty Images(NEW YORK) -- American Airlines and US Airways still have to convince the Federal Trade Commission that their proposed merger doesn't create a monopoly, but company officials and industry observers seem confident it will go through.

So, if you're a frequent flyer on one, the other, or both, how will this affect you? Well, first of all, even the airlines themselves acknowledge the full merger process will take at least 18 months. So if you're worried about your frequent flyer miles, you have a year and a half to burn through them. In fact, while the two airlines are in the process of smushing themselves into one, you may well be able to use each airline's miles on the other. That's what Continental and United did when they merged.

All in all, travel experts say miles-holders usually "fare" fine in these situations -- pardon the pun. But there are upsides and downsides to everything. Here are some of the main ones.

Pro:

1. More places to go. The new airline, which will be called American, promises to make 6,700 flights a day on 600 planes to 336 cities in 56 countries! US Airways and American say they currently only have about a dozen truly redundant routes. If you have miles now on either airline, you'll be able to use them on the new airline to go to all these new places.

2. Nicer aircraft. American has been pushing and publicizing nice amenities like more seats that lie flat, personal in-flight entertainment systems, worldwide Wi-Fi and more seating where you can pay to get 4 to 6 more inches for your poor knees. American has made a big a hubbub about all this, and the new airline is being branded as American, so it's likely you'll see more of these features.

3. Possible Perks. American serves more meals in flight on shorter runs and lets you use miles to book one-way seats. On the other hand, US Airways is known for its enticing frequent flyer redemption rates, such as just 90,000 miles to fly business class to parts of Asia and 110,000 miles to Australia and South Africa. Many analysts fear these goodies will go away. But I view it differently. YOU, as interested flyers, have 12 to 18 months to lobby the new airline to keep the best of BOTH. Email and tweet your desires and demands and see what you can accomplish!

Con:

1. Fewer partner airlines. Nobody tracks frequent flyer mile programs as obsessively as Brian Kelly of ThePointsGuy.com. Kelly's intel is that the newly merged airline will choose to be a part of the OneWorld alliance, of which American is currently a member, and not the Star Alliance, with which US Airways has long been affiliated. "That means it will go from having 27 partners down to just 11," Kelly says. "But that still includes great partners like British Airways, Cathay Pacific and Qantas."

2. Potentially higher fares. In a conference call, the leaders of the new "Franken-airline" swore up and down that their marriage will bring fares down, not up. They argue that as a single, more robust airline they'll be better able to compete with the other big guys. However, fewer players traditionally mean higher prices. Classic supply and demand. So we'll see.

3. More customer competition. When any two airlines merge, there are more top-level flyers under one roof, whether they're called "elite" or "platinum."  That means competition for free seats and upgrades could be ratcheted up.

Copyright 2013 ABC News Radio

Thursday
Feb142013

American Airlines, US Airways Announce Merger

American Airlines(NEW YORK) -- It's official: American Airlines and US Airways have reached an agreement to become the world's largest airline.

In a statement Thursday, both carriers announced that their boards of directors "have unanimously approved a definitive merger agreement under which the companies will combine to create a premier global carrier, which will have an implied combined equity value of approximately $11 billion."

The combined carrier will operate under the American Airlines name and will be based in Fort Worth, Texas, the headquarters of American.  US Airways CEO Doug Parker will head the new company.

The new airline is expected to maintain all hubs served by American and US Airways and will offer "more than 6,700 daily flights to 336 destinations in 56 countries."

The merger is expected to be finalized by the third quarter of this year.

Copyright 2013 ABC News Radio

Thursday
Feb142013

What US Airways, American Airlines Merger Means for Travelers

PRNewsFoto/American Airlines(NEW YORK) -- American Airlines and US Airways announced on Thursday that they will merge their operations and become one airline, called American Airlines.  Together, they will be the world's largest airline by passenger traffic.

So what does the merger mean for travelers?  

In the short-term, travelers will see virtually no changes from either airline.  The merger still faces regulatory obstacles and must be approved by the Department of Transportation and the Justice Department.  If and when it passes that scrutiny, the process of merging the two airlines' operations will begin.

If you're holding a ticket on US Airways or American Airlines, that ticket will still be valid on the airline you planned to fly, on the day and time you planned to fly it.

When you get to the airport, you will head to the same airline check-in counter by which your ticket was issued.

The only possible exception is if you are holding a ticket for many months out and your airline's schedule changes as a result of the merger of flight schedules.  In this case, you will be contacted by the airline ahead of time, typically to the email address you provided when the ticket was purchased.

And members of either airline's frequent flier programs need not worry: Your miles are still valid on your airline and it's very unlikely you'll lose miles or elite status.  

American and US Airways will merge frequent flier programs.  The new American Airlines will be part of the oneworld Alliance.  US Airways will leave the Star Alliance.

Longer term, the merger could mean higher prices.  The U.S., in the last decade, has gone from six legacy carriers (Delta, Northwest, United, Continental, American and US Airways) to four (Delta, United, American and US Airways).

If this merger is approved, just three legacy carriers will remain.

Certainly, the higher fares can't all be attributed to consolidation in the industry (fuel costs, a reduction in available seats and the economy all factor in) but in general, less competition means higher prices.

Higher airfare tends to hit smaller cities harder than larger cities because smaller cities and airports have less competition.

On the up side, the merger will also mean more destinations for the new American Airlines.  US Airways passengers will benefit from American's international routes, particularly in Europe and Latin America.  American will be able to access the smaller U.S. cities where US Airways has a large presence.

Copyright 2013 ABC News Radio

Wednesday
Feb132013

American Airlines and USAirways Merger Announcement Likely Thursday

Joe Raedle/Getty Images(NEW YORK) -- They've been dating for a year, and now it looks as though the marriage of American Airlines and USAirways will be announced Thursday, according to a source close to the negotiations.

The source tells ABC News that details of the merger agreement have been worked out, but it still needs approval from the two airlines' Boards of Directors. They are meeting to consider the deal.

If the two carriers merge, they are expected to retain the American Airlines name. The new airline would become the largest in the world.

Any deal is still subject to approval of the bankruptcy judge overseeing American Airline's bankruptcy, as well as the anti-trust division of the Department of Justice. Both are expected to sign off on the agreement.

This would be the third mega airline merger in the past five years. Delta and Northwest announced a merger in 2008, followed by United and Continental in 2010. The industry consolidation would leave four major carriers operating in the U.S.: American, Delta, United and low-coast carrier Southwest.

For travelers, nothing will change immediately. These complicated mergers can take more than a year to accomplish. Will this ultimately mean higher fares for travelers? Some analysts believe fares won't be greatly affected, because American and USAirways don't compete now on many of their routes.

One thing travelers won't have to worry about is their coveted frequent flyer miles. The airlines will merge their two frequent flyer programs, and the larger route system will give passengers more opportunity to earn those miles.

Airline mergers can be messy affairs. The biggest problem with most mergers is consolidating employees and employee contracts. In this case, deals have already been worked out with pilots, flight attendants and mechanics, which will help ensure smoother sailing when and if the airlines combine.

Copyright 2013 ABC News Radio

Sunday
Feb102013

American Airlines, US Airways Expected to Announce Merger 

Medioimages/Photodisc/Thinkstock(NEW YORK) -- American Airlines and US Airways are expected to announce a merger this week after months of negotiations, the New York Times reports.

The merger would create the country's largest airline and would expand American's domestic network, especially in the Northeast and Soutwest, making it more competitive in the international market. It would also put the combined airline ahead of of Delta Air Lines and United Airlines, which have both grown through their own mergers in recent years, the paper says.

The new airline will be based in Dallas and will be named American Airlines, according to the New York Times.

Copyright 2013 ABC News Radio

Thursday
Feb072013

Merger Between American Airlines, US Airways Near

PRNewsFoto/American Airlines(NEW YORK) -- American Airlines unveiled a whole new look last month.  And now, it appears the carrier is about to get a whole lot bigger.

Sources tell ABC News affiliate WFAA-TV in Dallas that a merger between American and US Airways will be announced next week after more than a year of talks.  If the merger goes through, it would make the combined company the biggest airline in the U.S., surpassing United-Continental, according to the Wall Street Journal.

WFAA reports the new company would likely keep the American Airlines name and would be based in Fort Worth, Texas -- the headquarters of American -- but run by the CEO of US Airways.

So how would the consolidation impact consumers?  

On the plus side, Rick Seaney, the CEO of FareCompare, says it could mean newer equipment and technology for travelers.

"If this makes a stronger American Airlines and U-S Airways, they're going to have more money, that means they can invest in their products so some of us will actually, when we buy our next ticket, we may be flying a plane that was built this century and maybe even a few of us, something was actually built this decade," he tells ABC News Radio.

But the merger would cut down the number of airlines in the U.S., likely causing air fares to rise.

"I think, you know, in the short haul, probably no big deal.  In the long haul, it almost, it guarantees that these airlines will never compete and the number one driver of ticket prices is competition, so all things equal, it will drive up prices in the future," Seaney says.

Copyright 2013 ABC News Radio

Friday
Oct052012

T-Mobile/MetroPCS Merger: What It Means for Consumers

T-Mobile(NEW YORK) -- On Wednesday, Deutsche Telekom, the parent company of T-Mobile USA, struck an agreement with MetroPCS, which provides no-contract cellphones and low-rate, prepaid plans with unlimited talk, text and Web options for a mere $40 a month.

While the new company will keep the T-Mobile moniker, MetroPCS and T-Mobile will continue to operate as separate customer units: T-Mobile will be responsible for contract-based mobile service (along with services for businesses), while pre-paid and non-contract service will be available under both brands.

Currently, T-Mobile is the nation’s fourth-largest wireless carrier after Sprint, AT&T and Verizon; MetroPCS is the fifth.  The new T-Mobile will be a public company with about 42.5 million subscribers and $24.8 billion in revenue.

“We are extremely pleased to announce this transaction with MetroPCS, which enhances Deutsche Telekom’s position in the expanding U.S. wireless market,” René Obermann, chief executive officer of Deutsche Telekom, said in a statement.

But what does the transaction, which is expected to close in the first half of 2013, mean for you, the consumer?

On the one hand, it’s good, “because the merger will increase competition in the prepaid market and consumers are likely to see more attractive price plans as well more attractive handsets, given that prepaid is now almost 30 percent of the market,” Chetan Sharma, president of Chetan Sharma Consulting, told ABC News.

Will Power, a senior analyst at RW Baird, agreed. “The merger is designed to provide MetroPCS with the financial and spectrum resources to roll out its product offering in additional markets, which should benefit consumers in the form of greater choice,” he told ABC News.

According to the Wall Street Journal, both networks will keep running until the end of 2015, when the MetroPCS network will be shut down.  That means MetroPCS consumers won’t have to rush out and get a new phone any time soon.  And when customers do have to buy a new phone, they will be automatically moved over to T-Mobile’s network.

But the best news is that cellphone prices across the board may actually drop.

“This merger between T-Mobile and Metro PCS is going to make the field more competitive for larger service providers, specifically AT&T and Verizon,” Bartees Cox, a communications associate at Public Knowledge, a technology and IP policy public interest group in Washington, D.C., told ABC News.  “Whenever there’s more competition we usually see prices drop, which is great in the public interest.  If T-Mobile continues to offer an unlimited data plan, it’s going to make it really hard for Verizon or AT&T to compete.”

On the downside, customer service might not change at all, which may not be such a good thing.  In Consumer Reports’ phone-carrier ratings poll, T-Mobile rated lower than most other cellphone carriers for reader satisfaction in contract service.  MetroPCS was among the lower-scoring prepaid carriers.

J.D. Power and Associates rated T-Mobile the lowest for customer service among all carriers.

Copyright 2012 ABC News Radio

Wednesday
Oct032012

T-Mobile US and MetroPCS to Merge

T-Mobile(NEW YORK) -- There's about to be one less carrier in the U.S.  T-Mobile US, which is owned by Deutsche Telekom in Germany, has announced that it will acquire MetroPCS, the fifth-largest mobile carrier in the U.S.

The companies will be combined under the T-Mobile name.  According to the company, the deal will result in a more products and deeper network coverage, which will includes plans for a bigger LTE network.

"The new company will be the value leader in wireless with the scale, spectrum and financial and other resources to expand its geographic coverage, broaden choice among all types of customers and continue to innovate, especially around the next-generation LTE network," René Obermann, CEO of Deutsche Telekom, said in a statement.

Deutsche Telekom's board unanimously approved the deal.  MetroPCS shareholders will receive $1.5 billion in cash and 26 percent ownership in the combined company.

In March 2011, AT&T made a move to acquire T-Mobile US, the fourth-largest carrier in the U.S., from Deutsche Telekom, but the deal was ultimately rejected by the Department of Justice because of antitrust issues.

"After AT&T's rejected acquisition of T-Mobile, this makes perfect sense, as T-Mobile could not structurally be on their own," market analyst Patrick Moorhead told ABC News.  "The combined entity of T-Mobile and MetroPCS is good for both sides.  T-Mobile brings 4G and LTE and MetroPCS brings a new large customer base."

T-Mobile has struggled to keep up with the other leading U.S. carriers, including Verizon, Sprint and AT&T.  While it offers 4G with its HSPA+ network, it doesn't have an LTE network at this point nor does it offer the iPhone.  More recently it announced plans for its unlimited data plan and its progress in rolling out an LTE market by 2013.

MetroPCS has become the fifth largest U.S. carrier for the last number of years with its contract-free, unlimited plans.

The merger will still have to get regulatory and MetroPCS shareholder approval.  It is expected to close in the first half of 2013.

Copyright 2012 ABC News Radio







ABC News Radio