American Airlines and US Airways confirm merger

American Airlines and US Airways have officially confirmed merger plans, following months of speculation. Subject to regulatory approval, the merged carrier will operate under the American Airlines name, and will be a member of the Oneworld alliance (US Airways is currently a member of Star Alliance). In a statement the two carriers said that the combined entity “expects to maintain all hubs and service to all destinations”. AMR, the parent company of American Airlines, will take a 72 per cent stake in the new company, with US Airways owning 28 per cent. The merged carrier will be headquartered in Dallas Fort Worth, with “significant corporate and operational presence in Phoenix). The merger is expected to deliver annual synergies of more than US$1 billion by 2015. Announcing the merger Tom Horton, chairman, president, and chief executive officer of American Airlines said: “Today, we are proud to launch the new American Airlines – a premier global carrier well equipped to compete and win against the best in the world. Together, we will be even better positioned to deliver for all of our stakeholders, including our customers, people, investors, partners, and the many communities we serve. “The combination of American and US Airways brings together two highly complementary networks with access to the best destinations around the globe and gives us a strong platform to provide our customers the most connected, comfortable travel experience available. "The operational and financial strength of the combined airline is expected to enable continued investment in new products and technologies and will create exciting new opportunities for our people, even as we deliver strong cash flow and sustainable profitability. Doug Parker, chairman and chief executive officer of US Airways, said that American Airlines “is one of the world’s most iconic brands”, adding that “The combined airline will have the scale, breadth and capabilities to compete more effectively and profitably in the global marketplace”. Horton will serve as chairman of the combined airline’s board of directors, while Doug Parker will serve as chief executive officer. The deal will also require approval from the US bankruptcy courts, with American Airlines having entered into bankruptcy protection in November 2011 (see online news December 1, 2011). The agreement follows the mergers of US carriers Delta and Northwest, and United and Continental in the last few years. A new website has been created giving more details of the AA / US Airways merger plans at newamericanarriving.com. Report by Mark Caswell