Hearings on a US Airways takeover sought by 3 on S.L. County Council

0 Comments | Deseret News (Salt Lake City), Dec 21, 2006 | by Jenifer K. Nii Deseret Morning News

A day after Delta Air Lines rolled out its plan to re-emerge from bankruptcy -- solo, thank you very much, rival/suitor US Airways -- three members of the Salt Lake County Council announced plans to request public hearings into what effect US Airways' proposed hostile takeover might have on the county.

Randy Horiuchi, Jenny Wilson and Joe Hatch said Wednesday they will ask the council to schedule public hearings on the matter so that the county's "voice is heard, and that all the facts are presented."

"We are the custodians, if you will, of a lot of the state's tourist industry," Horiuchi said. "The Salt Palace is under our jurisdiction. We manage it. Delta is such an important cog and piece of our strategy to go out and get conventions to come to the Salt Palace, so (a Delta/US Airways deal) has enormous ramifications. One of our biggest selling points has been the convenience of Salt Lake and having a Delta hub here."

Delta filed its reorganization plan Tuesday, calling for it to emerge from bankruptcy next spring as a stand-alone company, formally rejecting a $8.5 billion takeover bid from US Airways. US Airways responded shortly thereafter, saying it is still in the hunt as "a disciplined and determined bidder."

Jeff Allen, who will take his seat on the Salt Lake County Council in January, said he likes that the group is asking questions. But he has some of his own.

"It is an interesting idea, and I'm all in favor of talking about what options are available to us, and what we can do" to protect jobs and the county, Allen said. "I'm not yet certain what jurisdictional powers we have, or how we can affect a deal like that."

Horiuchi said he has already begun looking into those issues.

"We're investigating what our material opportunities would be to affect this business buyout," he said.

The council may not be able to intervene or prevent a takeover, but Horiuchi said it may look into how it may affect certain things put in place in years past to advantage or lure Delta -- fly-over tax rulings passed seven years ago, for example. And he's looking into whether the council has subpoena power to compel US Airways officials and others to participate in the hearings.

The trio's efforts are still preliminary, Horiuchi emphasized. They're still learning about what a potential takeover would look like, he said, and the process involved. But after Tuesday's anti- merger rally at Salt Lake City International Airport and the Salt Lake City Council's letter sent earlier this month supporting Delta, Horiuchi said they thought it was time for the County Council to get involved.

"We thought it was certainly worthwhile to get as much information as possible, to get some answers, thoughts and rationale as to why this is happening," he said.

Horiuchi said he will try to contact the other council members in the next few days to gauge their interest, although, he added, "we have the independent authority to go ahead and hold these hearings. The only things we'd really need to commit (are) some staff time and a place to hold the meetings."

Ideally, he hopes to get the ball rolling early in the new year.

Horiuchi, Wilson and Hatch are three of the council's four Democrats. The Salt Lake County Council is a nine-member body. But the three argued Wednesday, the proposed hearings are not about politics.

"This is not a Republican or Democrat issue. This is a Utah issue," Hatch said in a prepared statement. "Corporate raiders should not have the final say when it comes to airline safety or access to reasonable fares, and we have every reason to be concerned that if this hostile takeover goes through, the Salt Lake City airline hub will be the big loser."

E-mail: jnii@desnews.com