Airlines work to sew up US mega-merger
AMR and US Airways yesterday set out on a winding road towards regulatory approval for their $11bn (£7.1bn) merger deal, which was confirmed yesterday.
US Air’s management team, led by chief executive Doug Parker, will assume operational control of the airline, while AMR creditors will wind up owning 72 per cent of the combined carrier and take five seats on the 12-member board.
The deal, which will create the world’s biggest airline with 6,700 flights a day under the American Airlines brand, faces up to two years of “the hard work of implementation”, said Robert Mann, head of consultant RW Mann & Co. “So far it’s just been pushing paper.”
The tie-up is subject to approvals from US and European regulators, labour unions and the US Bankruptcy Court, and will give creditors of the bankrupt American Airlines parent control of the combined airline.
The two companies said they expect $1.2bn in one-time transition costs, spread over the next three years, but that the deal will generate $1bn in annual savings by 2015.
The enlarged airline will be based in Dallas-Fort Worth, Texas.