Revamped American Airlines will run 6500 US flights daily
Dallas – Arabstoday
American Airlines parent company AMR Corp and US Airways have announced that their boards have approved
a merger agreement to create the largest US airline.
The combined company, which will have an implied equity value of approximately $11bn, will become a fully operating entity following American\'s pending bankruptcy proceeding, according to a news release.
The morning announcement would create a combined airline with 94,000 employees, 950 planes, 6,500 daily flights, eight major hubs and total sales of nearly $39bn.
The carrier, expected to be called American Airlines, would be based in Fort Worth, Texas, where current bankrupt American parent AMR Corp has its headquarters.The new American -- taking the number one spot from United Airlines, which merged with Continental Airlines in 2011 -- would be the market leader on the US East Coast and Southwest but would remain a lesser player in Europe than United and Delta Air Lines, The New York Times said.
The merger was not expected to significantly strengthen the new American\'s presence in Asia, where it would trail United and Delta, the Times said.
If the merger is approved, American, United, Delta and Southwest Airlines would control 87 percent of the domestic US airline market, Airline Weekly analyst Seth Kaplan told USA Today.
The American-US Airways merger still needs to pass several steps. It must be approved by American\'s bankruptcy judge in New York, US Airways stockholders and the Justice Department\'s antitrust division.
Analysts said they expected regulators would clear the deal, although they might require the combined airline to give up slots at Washington National. Slots are the right to schedule a landing or departure during specific time periods.
\"I expect that the regulators will force a combined American-US Airways to divest themselves of some of the slots, and competitors would be free to compete for those available slots,\" William Swelbar, a researcher at the MIT International Centre for Air Transportation, told The Washington Post.
The merger has the backing of key American creditors, which is expected to smooth the way for bankruptcy-court approval.
Lawyers for American and its creditors were to appear in bankruptcy court on Thursday to discuss the merger and request a time extension to propose a reorganisation plan, the Journal said.
Source: AFP, UPI