business

Delta Air Lines CEO Richard Anderson told his employees Tuesday that he has not proceeded with a merger because Delta still doesn't have a deal that meets all of its goals.

Northwest Airlines and Delta have reached agreement on a merger, but executives at the carriers have been waiting for their pilot groups to integrate their seniority lists. It's unclear whether the two union groups can achieve that goal, because some pilots would be winners and others would be losers under virtually any methodology used to merge the lists.

"To date, we have not arrived at a potential transaction that meets all of our principles," Anderson said in a memo that was also signed by Ed Bastian, the airline's president.

Protecting the seniority of Delta employees was one of the five principles cited.

"Rest assured that we will not complete a transaction unless all of these conditions are met," the executives said.

Preserving the Delta name and Atlanta headquarters also are essential to Delta, the executives said. They added that a merger must allow Delta to strengthen its network and accelerate its plans to expand in the international market.

In November, Anderson said that the headquarters must remain in Atlanta. But Minnesota politicians pressed him in recent weeks to consider saving Northwest's headquarters in Eagan. The headquarters would be in Atlanta under the merger documents that the Delta and Northwest boards are poised to approve, according to a person familiar with the transaction.

In his employee memo, Anderson did not name the pilots' conflict or Northwest.

But it appears that he released the memo to reassure Delta employees that he has not deviated from core merger principles and that the airline has a "strong stand-alone plan" if that's needed.

Northwest CEO Doug Steenland said in a Tuesday message that Northwest's leadership is prepared to give "positive" consideration to a "transaction that would provide greater long-term security and growth opportunities for our employees" and create value for Northwest shareholders.

The Delta-Northwest merger is structured as a stock swap.

Liz Fedor • 612-673-7709