Delta chief tells senator no merger deal yet

By John Crawley

WASHINGTON (Reuters) - The chief executive of Delta Air Lines (DAL.N: Quote, Profile, Research) told a U.S. senator on Tuesday there is no merger agreement yet with Northwest Airlines (NWA.N: Quote, Profile, Research), but the two sides are continuing to work toward a deal.

Sen. Amy Klobuchar, a Minnesota Democrat, told Reuters in an interview that she spoke with Richard Anderson earlier in the day and he told her the airlines continue to work with their pilots on getting union support for consolidation.

Klobuchar said the Delta CEO did not have a specific time frame for any agreement or any guarantee from Anderson that a deal would be reached, but one source briefed on the matter told Reuters earlier that an announcement was possible within the next day or two.

The airlines have refused to comment substantively on merger discussions. Delta would not comment on reports that the boards of both carriers were scheduled to meet on Wednesday, possibly to vote on a plan.

Shares of U.S. airlines were mainly lower on Tuesday. Delta lost 55 cents, or 3.2 percent, to close at $16.77. Northwest fell 23 cents, or 1.3 percent, to $16.97.

In a letter to Klobuchar, Anderson and Northwest Chief Executive Doug Steenland discussed their vision of consolidation in an effort to reassure lawmakers concerned about possible service cuts and job losses.

The executives said they favor any merger that would offer greater efficiency and service improvements, not job cuts or contraction of routes or hubs.

"Any merger we might contemplate would be a transaction that succeeds through the power of addition, not subtraction," the two wrote in the letter dated February 8. Klobuchar's office released the letter on Tuesday.