Exhibit (b)(1)
February 15, 1999
Board of Directors
ASA Holding, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000-0000
Members of the Board
We understand that ASA Holdings, Inc. ("ASA" or the "Company"), Delta Air Lines,
Inc. ("Delta") and Delta Sub, Inc., a wholly owned subsidiary of Delta
("Acquisition Sub"), propose to enter into an Agreement and Plan of Merger dated
as of February 15, 1999 (the "Merger Agreement"), which provides, among other
things, for (i) the commencement by Acquisition Sub of a tender offer (the
"Tender Offer") for all outstanding shares of common stock, par value $0.10 per
share, of ASA (the "Common Stock") for $34.00 per share net to the seller in
cash, and (ii) the subsequent merger (the "Merger") of Acquisition Sub with and
into ASA. Pursuant to the Merger, ASA will become a wholly owned subsidiary of
Delta and each outstanding share of Common Stock of ASA, other than shares held
in treasury or held by Delta or any subsidiary of Delta or as to which
dissenters' rights have been perfected, will be converted into the right to
receive $34.00 per share in cash. The terms and conditions of the Tender Offer
and the Merger are more fully set forth in the Merger Agreement.
You have asked for our opinion as to whether the consideration to be received by
the holders of shares of Common Stock pursuant to the Merger Agreement is fair
from a financial point of view to such holders (other than Delta and its
affiliates).
For purposes of the opinion set forth herein, we have:
(i) reviewed certain publicly available financial statements and other
information of the Company;
(ii) reviewed certain internal financial statements and other financial
and operating data concerning the Company prepared by the management
of the Company;
(iii) analyzed certain financial projections prepared by the management of
the Company;
(iv) discussed the past and current operations and financial condition and
the prospects of the Company, including the Company's expected future
relationship with Delta, with senior executives of the Company;
(v) reviewed the reported prices and trading activity for the Common
Stock;
(vi)
(vii) compared the financial performance of the Company and the prices and
trading activity of the Common Stock with that of certain other
comparable publicly-traded companies and their securities;
(viii)reviewed the financial terms, to the extent publicly available, of
certain comparable acquisition transactions;
(ix) participated in discussions and negotiations among representatives of
the Company and Delta and their financial and legal advisors;
(x) reviewed the Merger Agreement and certain related documents;
(xi) performed such other analyses and considered such other factors as we
have deemed appropriate.
We have assumed and relied upon without independent verification the accuracy
and completeness of the information reviewed by us for the purposes of this
opinion. With respect to the financial projections, we have assumed that they
have been reasonably prepared on bases reflecting the best currently available
estimates and judgments of the future financial performance of the Company. We
have assumed that the Tender Offer and the Merger will be consummated on the
terms set forth in the Merger Agreement. We have not made any independent
valuation or appraisal of the assets or liabilities of the Company, nor have we
been furnished with any such appraisals. Our opinion is necessarily based on
economic, market and other conditions as in effect on, and the information made
available to us as of, the date hereof.
In arriving at our opinion, we were not authorized to solicit, and did not
solicit, interest from any party, nor did we have discussions with any party
other than Delta with respect to the acquisition of the Company or any of its
assets.
We have acted as financial advisor to the Board of Directors of the Company in
connection with this transaction and will receive a fee for our services. In
addition, Xxxxxx Xxxxxxx provides no advice or recommendation as to whether or
not holders of shares of Common Stock should participate in the Tender Offer. In
the past, Xxxxxx Xxxxxxx has provided financial advisory and financing services
for Delta and has received fees for the rendering of these services.
Based on the foregoing we are of the opinion on the date hereof that the
consideration to be received by the holders of shares of Common Stock pursuant
to the Merger Agreement is fair from a financial point of view to such holders
(other than Delta and its affiliates).
Very truly yours,
XXXXXX XXXXXXX & CO. INCORPORATED
By: /s/ Xxxx X. Xxxxxxx
--------------------------
Xxxx X. Xxxxxxx
Principal
