In a deal having far-reaching implications, American Airlines and US Airways have decided to merge in a $11 billion deal to create the biggest airline globally. The resulting entity will be named American Airlines but run by US Airways CEO Doug Parker. The boards of the two airlines have unanimously approved the deal.
AMR creditors and shareholders will own 72 % stake in the new company with the rest 28 % going to US Airways shareholders. The merger reduces the number of major U.S. airlines to four: the new American, United, Delta and Southwest.
The deal is a coup for US Airways, which pressed for a merger when American parent AMR Corp. filed for bankruptcy protection in November 2011. The combined airline is expected to achieve the scale, breadth and capabilities to compete more effectively and profitably in the global marketplace. The merger would save more than $1 billion a year.
The new airline would have 900 planes, 3200 daily flights and about 95,000 staff, excluding regional affiliates. It will be slightly bigger than United Airlines in terms of passenger traffic.