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Before moving to UnitedHealth, Richard Anderson spent 14 years rising through the ranks at Northwest Airlines.  He served as CEO during several difficult years preceding the airline's bankruptcy in 2005.  During his tenure, he oversaw one of the industry's leading franchises across the Pacific.   

Anderson, who currently serves on Delta's board, says the Atlanta-based carrier now needs to expand internationally.  Delta is up against Northwest for new routes to China, and Delta is considered a frontrunner in that competition.  Anderson says Delta must develop its network across Asia and other destinations. 

"Delta has to move from its roots as a regional airline to a real global airline. I have a lot of experience internationally, both with alliances, and with operations in the Pacific," Anderson says. "And the ability to branch out and take the great Delta service and the great Delta name to all corners of the world is a big opportunity ahead of us."

Anderson's move has reignited speculation on Wall Street and in the industry about a merger between Northwest and Delta.  Their route systems have little overlap, and they already have an agreement to sell tickets on each others' flights. 

Many industry observers are convinced the industry will eventually have to consolidate.  Merger speculation took off earlier this year when US Airways unsuccessfully tried to buy Delta. At one point Delta formally announced that it had considered a potential "business combination" with Northwest.  

Anderson is now downplaying the possibility of a combination, telling reporters Delta has no plans for a merger.  Northwest would not comment on the matter.

Airline analyst Darryl Jenkins says now is not really the time for Delta and Northwest to pair up, especially when both are enjoying post-bankruptcy profits.

"In an upswing, labor is going to want a big chunk of the pie. And so the only time you can get a merger through labor is during a downturn when they think they're all going to lose their jobs," he says.

Jenkins contends the more interesting marriage to watch right now is between Northwest and Midwest Airlines.  Northwest and a private equity firm plan to buy the Milwaukee-based carrier, pending approval by Midwest shareholders and the Department of Justice.  Jenkins thinks the DOJ's ruling could send some signals about anti-trust issues in the airline industry.

"It does appear that Northwest could be an active investor in that, and there's some real interesting competitive issues.  So I do think that how Justice handles that could give us some real clues to how they might view consolidation in the future," Jenkins says.

This story also involves alternative energy. Enter Lois Quam.  Or rather, exit Lois Quam. She's also leaving UnitedHealth, which means the company is losing two of its three top executives under CEO Stephen J. Hemsley. Last year Fortune magazine named Quam to its list of 50 most powerful women.

Quam is taking a job with Piper Jaffray to develop new businesses focused on alternative energy, clean technology and health care.

Quam says a stock options backdating scandal and ongoing investigations of UnitedHealth Group were not a factor in her decision. 

Instead, she points to the influence of recent travels with Arctic explorer Will Steger, who is outspoken about the effects of global warming. Quam says her travels convinced her of the need to fix the nation's energy problems.

"Addressing these challenges that we have is going to take business and government working together," Quam says. "It's going to take growing new businesses don't exist now, or taking businesses like wind that are relatively small and make them very big, and I thought, 'That's what I already do.'" 

UnitedHealth immediately named replacements for Quam and Anderson, and said one of the company's hallmarks is a deep bench of leadership talent.

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Business and Economic News

Annie Baxter

Author

UnitedHealth Group, the giant Minnetonka-based health insurer, is losing two high-profile executives.  Both departures come as something of a surprise.

University of Minnesota Carlson School of Management Professor Steve Parente talks about the changes at UnitedHealth

University of Minnesota Carlson School of Management Professor Steve Parente

UnitedHealth spokesman Don Nathan discusses the executive departures

UnitedHealth spokesman Don Nathan

UnitedHealth outgoing executive Lois Quam talks about her job change

UnitedHealth Group loses two top execs, one to Delta Airlines, one to Piper Jaffray

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