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US Air ignores Global bid
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August 6, 2001: 10:08 a.m. ET
No. 6 airline doubts seriousness of $1.8B offer from firm that failed to buy TWA
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NEW YORK (CNNfn) - US Airways Group, whose proposed $4.3 billion purchase by United Airlines was thwarted last month by the U.S. government, dismissed a $1.8 billion cash-and-stock offer from Global Airlines Corp. Monday, a privately held company that unsuccessfully bid for Trans World Airlines earlier this year.
"Neither Mr. (Emil) Bernard, nor his company has established any meaningful credentials in support of their so-called proposal, nor has he met with senior executives of US Airways," the company said in a statement. "The company does not believe that it can give any credibility to this so-called proposal, and accordingly, has no plans to deal with it."
Global Airlines Corp. said Sunday it will offer $27 a share in cash and stock for Arlington, Va.-based US Airways (U: up $1.06 to $17.94, Research, Estimates). In addition, it said it would assume nearly $8 billion in debt of the No. 6 U.S. carrier.
Global Spokesman John Scott said a tender offer initially was made July 18, and that the offer had been extended to midnight, Aug. 13.
Under the terms of the offer, Global would acquire all 67.1 million outstanding shares of US Airways for $10 cash and another $17 in Global nonvoting class B stock, which would be registered and traded on the New York Stock Exchange under the symbol GAC if the deal goes through, Scott said. If US Airways' board of directors doesn't respond to the offer which it has indicated it will not, Global will proceed with a tender offer to US Airways' shareholders no later than Sept. 4, Scott said.
Last November, Global Airlines, which has no operations, offered to buy TWA for $298 million in cash and stock, but the deal fell through after analysts questioned the offer's validity.
Global Airlines is a holding company based in New York and Los Angeles that was set up to acquire an airline.
"Going forward, we want to buy other companies," Scott said.
Global's bid for US Airways comes on the heels of that carrier's failed merger attempt with UAL Corp.'s (UAL: Research, Estimates) United Airlines July 27. US Airways and United cancelled their deal after federal regulators said they wouldn't approve the transaction.
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The Justice Department said the deal, which would have been the largest airline combination in history, would have hurt competition and raised air fares.
Last week, US Airways said it was seeking the approval of its pilots' union to add regional jets to its fleet in an effort to remain functional and competitive as a stand-alone company. 
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