US Air, AMR near $11-bn merger

  • Reuters, New York
  • |
  • Updated: Feb 10, 2013 22:13 IST

US Airways Group Inc and AMR Corp are nearing an $11 billion merger that would create the world's largest airline and could announce a deal within a week, after resolving key differences on valuation and management structure, people familiar with the matter said.

Under terms of a deal that are still being finalised, US Airways chief executive Doug Parker would become CEO, while AMR's Tom Horton would serve as non-executive chairman of the board until spring of 2014, when the combined company holds its first annual meeting, the sources said.

The deal would come more than 14 months after the parent of American Airlines filed for bankruptcy in November 2011.

The all-stock merger is expected to value the combined carrier at between $10.5 billion and $11 billion, and would give AMR creditors 72% of the ownership in the new company and US Airways shareholders the rest, they said.

 

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