Filed by Northwest Airlines
to Rule 425 under the
Act of 1933 and deemed filed
to Rule 14a-12 under the
Exchange Act of 1934
Company: Northwest Airlines Corporation
File No.: 0-23642
filing (including information included or incorporated by reference herein)
includes “forward-looking statements” within the meaning of the safe harbor
provisions of the United States Private Securities Litigation Reform Act of
1995. Words such as “expect,’ “estimate,” “project,” “budget,”
“forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,”
“believes,” “predicts,” “potential,” “continue,” and similar expressions are
intended to identify such forward-looking statements. These
forward-looking statements include, without limitation, Delta's and Northwest’s
expectations with respect to the synergies, costs and charges, capitalization
and anticipated financial impacts of the merger transaction and related
transactions; approval of the merger transaction and related transactions by
shareholders; the satisfaction of the closing conditions to the merger
transaction and related transactions; and the timing of the completion of the
merger transaction and related transactions.
forward-looking statements involve significant risks and uncertainties that
could cause the actual results to differ materially from the expected results.
Most of these factors are outside our control and difficult to
predict. Factors that may cause such differences include, but are not
limited to, the possibility that the expected synergies will not be realized, or
will not be realized within the expected time period, due to, among other
things, (1) the airline pricing environment; (2) competitive actions taken by
other airlines; (3) general economic conditions; (4) changes in jet fuel prices;
(5) actions taken or conditions imposed by the United States and foreign
governments; (6) the willingness of customers to travel; (7) difficulties in
integrating the operations of the two airlines; (8) the impact of labor
relations, and (9) fluctuations in foreign currency exchange
rates. Other factors include the possibility that the merger does not
close, including due to the failure to receive required stockholder or
regulatory approvals, or the failure of other closing conditions.
Northwest caution that the foregoing list of factors is not exclusive.
Additional information concerning these and other risk factors is contained in
Delta’s and Northwest’s most recently filed Forms 10-K. All
subsequent written and oral forward-looking statements concerning Delta,
Northwest, the merger, the related transactions or other matters and
attributable to Delta or Northwest or any person acting on their behalf are
expressly qualified in their entirety by the cautionary statements above. Delta
and Northwest do not undertake any obligation to update any forward-looking
statement, whether written or oral, relating to the matters discussed in this
Information About the Merger and Where to Find It
connection with the proposed merger, Delta will file with the Securities and
Exchange Commission (“SEC”) a Registration Statement on Form S-4 that will
include a joint proxy statement of Delta and Northwest that also constitutes a
prospectus of Delta. Delta and Northwest will mail the joint proxy
statement/prospectus to their stockholders. Delta and Northwest urge
investors and security holders to read the joint proxy statement/prospectus
regarding the proposed merger when it becomes available because it will contain
important information. You may obtain copies of all documents filed with the SEC
regarding this transaction, free of charge, at the SEC’s website (www.sec.gov).
You may also obtain these documents, free of charge, from Delta’s website
(www.delta.com) under the tab “About Delta” and then under the heading “Investor
Relations” and then under the item “SEC Filings.” You may also obtain these
documents, free of charge, from Northwest’s website (www.nwa.com) under the tab
“About Northwest” and then under the heading “Investor Relations” and then under
the item “SEC Filings and Section 16 Filings.”
Northwest and their respective directors, executive officers and certain other
members of management and employees may be soliciting proxies from Delta and
Northwest stockholders in favor of the merger. Information regarding the persons
who may, under the rules of the SEC, be deemed participants in the solicitation
of Delta and Northwest stockholders in connection with the proposed merger
will be set forth in the proxy statement/prospectus when it is filed with the
SEC. You can find information about Delta’s executive officers and directors in
its Annual Reports on Form 10-K (including any amendments thereto), Current
Reports on Form 8-K and other documents that have previously been filed with the
SEC since April 30, 2007 as well as in its definitive proxy statement to be
filed with the SEC related to Delta’s 2008 Annual Meeting of Stockholders. You
can find information about Northwest’s executive officers and directors in its
Annual Reports on Form 10-K (including any amendments thereto), Current Reports
on Form 8-K and other documents that have previously been filed with the SEC
since May 31, 2007 as well as in its definitive proxy statement to be filed with
the SEC related to Northwest’s 2008 Annual Meeting of Stockholders. You can
obtain free copies of these documents from Delta and Northwest using the contact
Lines, Inc. and Northwest Airlines Corporation have created a website at
www.newglobalairlines.com with information about the merger. The website
includes the information being filed herewith.
Myths About Airline Mergers
Richard Anderson and Doug Steenland
that the merger we've just announced between Delta Air Lines and Northwest
Airlines will be much debated in coming weeks, and many voices will weigh in on
the merits of the transaction. That is healthy and part of the
our view of where things stand.
airline industry is at a crossroads. One choice is to continue on the road now
traveled, with network carriers whipsawed by the high price of oil; nationwide
competition from discount carriers; and increasing competition from large,
well-funded foreign airlines that are increasing service to the U.S. through
Open Skies agreements that have liberalized aviation markets around the
choice, the path we are taking, is to combine our two complementary route
systems into a single global network at a time when we are both in a position of
strength. The combined company will be more stable and be better able to grow to
meet the challenges of the future, both at home and abroad.
no question that the track record of airline mergers has been mixed, but the
entire industry is the product of consolidation. The mergers that were driven by
overlapping route systems and hub cutbacks had a hard time integrating their
operations. Complementary ones -- like Delta-Western in 1987 -- have gone more
smoothly. The industry that has resulted is the most competitive in the world,
and provides Americans with far more airline service, at much lower prices, than
before the industry was deregulated.
some myths and misperceptions about airlines mergers:
One: Airline mergers cause big job losses.
Reality: Bankruptcies and
high oil prices have caused significantly more job losses than mergers. The last
recession, combined with the terrorist attacks of Sept. 11, 2001, caused a wave
of bankruptcies that resulted in a loss of over 150,000 jobs just among the U.S.
in the first half of 2008 alone, record fuel prices have led to the shutdown or
bankruptcy filings of five U.S. carriers. We will furlough no frontline
employees as a result of this merger.
Two: This deal will jeopardize employees' benefits.
Reality: The merger will
create a financially stronger airline, better positioned to protect jobs,
compensation and benefits. Delta and Northwest worked side by side with their
employees to obtain passage of the Pension Protection Act of 2006, to make
pension funding more affordable. The transaction will make employee pensions and
benefits more secure.
Three: Prices will go up as a result of the merger.
Reality: In this industry,
prices are set by market forces and competition. There is very little overlap
between our route networks and the merged airline will face intense competition
throughout its system.
U.S., discount carriers have more than doubled their capacity since 2000; they
now account for one-third of domestic traffic, and the legacy carriers must
match their ticket prices or risk losing business.
now carries more passengers annually than any other airline; and even after a
Delta-Northwest merger, Southwest would continue to have the largest share of
domestic passengers, with no single U.S.
holding more than a 20% domestic passenger share.
Four: We need to close hubs to justify synergies.
Reality: This merger will be
different from any actual or proposed airline merger of the recent past. Those
mergers were often predicated on achieving cost savings by eliminating hubs.
Thanks to our complementary route networks, we will keep all of our hubs open.
The synergies are largely driven by expanded route networks and operational
Five: Consolidation will result in service cutbacks for customers.
Reality: You are already
seeing airlines being forced to cut capacity across the U.S. because of sky-high
fuel prices, not because of mergers.
first half of 2008 alone, record fuel prices have forced the industry to reduce
by more than 1.6 million the number of seats available to passengers. The
merger, by producing a stronger competitor, will make service cutbacks less
likely than if Delta and Northwest remained separate.
combined airline will serve more than 140 small communities in the U.S. -- more
than any other airline. From the small communities and the cities we serve,
customers will be able to reach virtually any place in the world with fewer
connections, as we bring together our two geographically distinct route
Six: This is all being driven to fatten profits for Wall Street and hedge
Reality: This has nothing to
do with hedge funds. It is about paying employees fair wages, reinvesting in new
products and services for customers, earning a return for shareholders who have
committed their capital, and being a good corporate citizen.
unprofitable airline cannot do any of these things. Collectively the industry
has lost more than $29 billion since 2001. Major U.S. carriers are once again
losing money. Rising fuel costs have offset savings from cost-cutting and
restructuring initiatives. Volatile fuel prices have fundamentally changed the
economics of the airline industry. Building a stronger route network is an
antidote to the boom-bust cycle that has plagued the airline industry, and is
the best way to reverse the trend of service cuts that is happening as a result
of record fuel prices.
in the industry may be the only alternative to another wholesale round of
turmoil and dislocation, the likes of which we are already beginning to see.
Combining Delta and Northwest, with our complementary domestic and international
routes, will create a strong U.S. competitor to the foreign airlines -- while
preserving jobs by becoming a more financially secure airline. This is good news
for our customers, the communities we serve, and our employees.
Messrs. Anderson and Steenland are
CEOs of Delta Air Lines and Northwest Airlines, respectively.