Dec. 8 (Bloomberg) -- Northwest Airlines Corp. plans to hire Evercore Group LLC for strategic advice, fueling speculation it's considering a merger or acquisition. The shares jumped 48 percent, and a bond rose to a 14-month high.

The airline asked a U.S. bankruptcy court today for permission to hire Evercore. Such requests are usually granted.

Northwest, the fifth-largest U.S. carrier, may feel pressure to combine with another airline as rivals look to grow through acquisitions. US Airways Group Inc. proposed a hostile takeover of Delta Air Lines Inc. last month, and United Airlines Chief Executive Officer Glenn Tilton has said mergers would help the industry recover from $40 billion in losses since 2001.

Airline mergers are imminent, said Michael Roach, a San Francisco-based consultant with Roach & Sbarra and a former airline executive. ``We have a game of musical chairs here, and the music's running, and there aren't very many chairs.''

Evercore, a unit of Evercore Partners Inc., would be paid $75,000 a month along with a $3 million fee when Northwest emerges from bankruptcy, the filing said. If Northwest completes a merger, Evercore would collect an additional $2 million.

Evercore Chairman Roger Altman and senior managing directors William Hiltz and David Ying would work with Northwest, according to a letter filed in bankruptcy court.

``It's not a bad time to start looking for a partner,'' said Jon Ash, president of InterVistas-GA2, a Washington consulting firm. Northwest would be a good fit for Delta or US Airways because they have complementary route systems, Ash said.

Shares, Bonds Gain

Shares of Northwest gained $1.59 to $4.90 at 4:09 p.m. New York time in over-the-counter trading. They have risen from 54 cents at the start of the year on speculation about a merger or acquisition.

The company's 7.625 percent note due in 2023 rose 4.5 cents to 89.5 cents on the dollar, yielding 12.5 percent, according to Trace, the NASD's bond-price reporting service. It was the bond's highest price since October 2005.

Northwest spokesman Kurt Ebenhoch said the Eagan, Minnesota-based carrier wouldn't comment beyond the filing. Northwest has said it plans to emerge from bankruptcy on its own in the first half of 2007. New York-based Evercore's outside public relations counsel, Chuck Dohrenwend, declined to comment.

Northwest is working toward a goal of $2.5 billion in annual cost cuts. It has trimmed flying and slashed jobs as part of its plan to emerge from Chapter 11 protection.

US Airways made an $8.63 billion hostile takeover bid for bankrupt Delta on Nov. 15. Delta is fighting the proposal and has said it still plans to emerge from bankruptcy next year on its own.

Industry Consolidation

US Airways exited bankruptcy 14 months ago through a merger with America West Holdings Corp. UAL Corp.'s United hasn't commented on published reports that it hired Goldman, Sachs & Co. for strategic advice in September.

Northwest has hired other bankruptcy and strategist firms for counsel since its Sept. 14, 2005, filing for Chapter 11. It works with Seabury Group LLC of New York, which has advised other bankrupt carriers such as US Airways during its merger with America West Airlines.

Northwest said in the filing that Evercore's work wouldn't overlap with Seabury. Seabury focuses mostly on restructuring bankrupt companies, Ash said.

Owl Creek Asset Management LP of New York bought $6.6 million worth of Northwest shares in recent months in anticipation of a transaction involving Northwest. The airline has said it anticipates canceling its common stock upon exiting bankruptcy.

The case is In re. Northwest Airlines Corp., 05-17930, Bankruptcy Court, Southern District of New York (Manhattan).

To contact the reporters on this story: Eric Torbenson in Dallas at etorbenson@bloomberg.net; Mary Schlangenstein in Dallas at maryc.s@bloomberg.net

Last Updated: December 8, 2006 17:34 EST