Delta/Northwest merger seen likely to be approved

By John Crawley

WASHINGTON (Reuters) - A proposal by Delta Air Lines (DAL.N: Quote, Profile, Research) to buy Northwest Airlines (NWA.N: Quote, Profile, Research) is likely to be approved by the U.S. government, an influential lawmaker on aviation affairs said on Wednesday.

Rep. John Mica, a Florida Republican and former chairman of the House of Representatives aviation subcommittee, told a hearing on the merger proposal the deal to create the world's biggest airline did not appear anti-competitive.

Democratic colleagues on the panel predicted the merger would probably lead to service reductions and job cuts and usher in other mergers to further narrow choices for consumers.

"In short, the pending merger places at risk the consumer benefits of airline deregulation," said James Oberstar, a Minnesota Democrat and chairman of the House Transportation Committee.

But Mica said the industry faces enormous challenges and it was more likely than not that "this merger will be granted" by officials at the Justice and Transportation departments who are reviewing the potential impact on competition and service.

Antitrust and industry experts have said previously the Delta/Northwest proposal stood a good chance of winning regulatory approval.

A senior official from the Justice Department's antitrust division, James O'Connell, told the hearing that he could not comment on the case.

But O'Connell said competition in the airline industry "is critical" and said the agency has a "strong record" of "enforcing antitrust laws" in the industry.