Merger rumors may start over Delta's pick for CEO

ATLANTA — Delta Air Lines named former Northwest Airlines Chief Executive Richard Anderson as its new leader Tuesday, a move that could revive speculation about a possible merger between the two carriers.

Anderson, a Delta board member and an executive at UnitedHealth Group, will replace Gerald Grinstein as Delta's CEO.

Seattle native Grinstein had said he would step down once his successor was named.

Anderson, 52, will become CEO effective Sept. 1, and Grinstein, 75, will retire from Delta and from its board and return to Seattle.

In a statement, Delta said Anderson "brings a unique depth of experience to the position, having served in top jobs for several major U.S. corporations."

The board's chairman, Daniel Carp, said Anderson "possesses the right blend of seasoned leadership, strategic skills, international experience and airline knowledge the company needs to navigate the industry's challenges and capitalize on its opportunities."

Grinstein said in a memo to Delta Air Lines employees that while he believed an internal candidate could run the company, Anderson will be an effective CEO.

At the same time, Grinstein said the future "will require a commitment to change and constant improvement and innovation."

"It will require a willingness to capitalize on the momentum created and to seize the right opportunities," Grinstein added.

Anderson said in his own memo to employees that there is a solid strategy in place and he plans to "stay the course."

He added that in the weeks ahead, he will travel around the Delta system to meet employees and "listen and share ideas about how we can take Delta to new heights of value, performance and service."

"In this brutally competitive industry, we need to think together about how to capture the momentum you've created and make it work to the advantage of our customers, our shareholders and importantly, all of you," Anderson wrote.

The chairman of the executive committee of Delta's pilots union, Lee Moak, said the pilots hope Anderson will work with employees to improve the company, which they've worked hard to keep independent.

"Working together, we will build a successful, profitable and stand-alone Delta," Moak said. "That will be in the best interest of the Delta pilots, all Delta employees and our customers."

Anderson has worked at UnitedHealth for nearly three years. Before that, he was CEO of Northwest Airlines from 2001 to 2004.

He also serves as a director of Cargill and Medtronic, according to Delta's Web site.

The change at the top at Delta follows the airline's 19 ½-month reorganization under bankruptcy protection.

Delta entered Chapter 11 on Sept. 14, 2005, and emerged April 30.

In bankruptcy, Delta shed billions in costs and restructured the carrier's operations. It also survived a hostile takeover bid by US Airways.

Delta executives, faced with questions about a post-bankruptcy valuation below what they initially had projected and below what US Airways offered for Delta, have declined to speculate about whether the airline would consider a deal with another carrier to increase shareholder value.

Besides finding a new CEO, Delta's board has to decide whether to sell or spin off regional carrier Comair.