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Delta stock soars on renewed speculation about merger

ATLANTA - Delta Air Lines Inc. shares soared as much as 13 percent Thursday following renewed speculation that the nation's No. 3 carrier may be close to inking a deal to combine with another airline.

In afternoon trading, Delta shares were off their highs of the session, but still up $1.23, or 9.1 percent, at $14.75.

The surge followed a nearly 15 percent rise in Delta's stock on Wednesday.

On Wednesday, the head of the Atlanta-based company's pilots union said in a letter to rank-and-file members that a combination involving Delta may be close.

Lee Moak, chairman of the union's executive committee, said in the letter that 'consolidation may indeed be at our door.'

He added later in the letter, 'While the bankruptcy threat is now behind us, the potential for a consolidating event is every bit as real.'

Moak said union leaders are meeting in Atlanta this week in part to discuss 'the fact that our company may soon be involved in some form of industry consolidation.'

Moak noted in the letter that fuel prices are at record highs and Delta's stock price since the company emerged from Chapter 11 last April has fallen dramatically, at one point as much as 45 percent. Its shares soared nearly 15 percent in trading Wednesday.

Moak did not say in the letter how the union is aware Delta may be close to a merger. The pilots union has a representative on Delta's board of directors.

Moak did not provide any specifics on a possible merger involving Delta, but he said the union has retained legal counsel specializing in the field of mergers and acquisitions, and he has reactivated the union's strike preparedness committee.

Moak reiterated that the pilots union would support a merger involving Delta under the right circumstances.

Delta spokeswoman Betsy Talton declined to comment Wednesday on Moak's letter beyond restating what Delta has previously said regarding consolidation.

Delta has said its board is evaluating whether to enter into a deal to combine with another airline.