AA, US Airways announce $11-bn merger
American Airlines and US Airways agreed Thursday to merge in an $11 billion deal that would create the world’s biggest airline.india Updated: Feb 15, 2013 02:07 IST
American Airlines and US Airways agreed Thursday to merge in an $11 billion deal that would create the world’s biggest airline.
The combined carrier will be called American Airlines and be based in Fort Worth. It expects to have $40 billion in annual revenue and offer more than 6,700 daily flights to 336 destinations in 56 countries.
The deal is a coup for smaller US Airways Group Inc., and was driven by the persistence of its CEO, Doug Parker, who will run the combined airline.
Parker sought a merger after American parent AMR Corp. filed for bankruptcy in November 2011.
As Parker pushed ahead, creditors forced AMR’s management to consider the value of a merger compared with a plan for an independent American.
Eventually they concluded that the best return for stakeholders, and the best chance to compete with bigger rivals United Airlines and Delta Air Lines, came from a merger.