Air France/KLM To Invest In Combined Airline

No one is commenting publicly on the matter, of course... but unnamed sources say executives with Delta Air Lines and Northwest Airlines have reached agreement on major terms of a rumored merger between the two carriers, that would create the largest US airline by passenger traffic.

The joined airline will keep the Delta name, according to sources cited by Bloomberg, and will be based in Atlanta, GA. Delta CEO Richard Anderson (right) will run the combined airline, they added.

Air France/KLM will invest in the combined airline, the reports state, in exchange for a board seat. The size of Air France's potential stake hasn't been set.

Spokespeople with Delta, Northwest, and Air France continued to remain mum on the matter, as has become tradition since talks reportedly began late last year.

As ANN reported, Air France-KLM -- which partners with both Delta and Northwest in the SkyTeam alliance -- said in January it was eager to offer strategic or financial backing for a merger between the two.

Adding credibility to the reports was official word from Delta on Wednesday, that Anderson agreed to waive millions of dollars in payments which would be due him under terms of his contract if a merger took place.

"The personnel and compensation committee of Delta's board of director has accepted his offer," a Delta spokesman told Reuters.

The same reports, however, suggested Anderson might be displaced in the merger... so who knows?

As for a timetable, it's looking less likely we'll hear an official merger announcement this week, as some analysts had predicted just a few days ago. Talks within the Air Line Pilots Association to resolve issues involved in combining pilot workforces are reportedly proceeding slowly.

Reuters states insiders believe a merger announcement is now expected "within weeks."

FMI: www.delta.com, www.nwa.com, www.airfrance.com