US merger would create world's biggest airline
Nikhil Kumar is The Independent's New York correspondent. He was formerly assistant editor on the foreign desk and has also done a variety of jobs on the city desk, where he wrote about markets, commodities and other business and economics topics.
Tuesday 12 February 2013
A merger of American Airlines and US Airways to create the world's largest carrier is in prospect as the two sides work on the final details.
Speculation has been mounting about an agreement which could be announced in coming weeks, with reports yesterday indicating that the boards of the two airlines would meet tomorrow to consider the plan. Although talks could yet break down, a deal, which could be worth as much as $11bn (£7bn), would see the creation of the world's largest airline by passenger traffic.
On Friday, US Airways pilots signed an agreement over pay and working terms if there is a merger. The three staff unions at American Airlines also support a deal.
US Airways is said to have initiated merger talks after American's parent, AMR, sought bankruptcy protection last year, partly as a result of expensive labour agreements which hampered its ability to compete.
The deal would push a combined American-US Airways ahead of United Airlines and Delta Air Lines. The latter two are themselves the result of consolidation within the industry. United and Continental merged in 2010, while Delta joined with Northwest in 2008.
Any deal involving AMR would require the approval of anti-trust authorities and the bankruptcy judge, as it remains under court protection.
According to reports, the deal would involve US Airways leaving the StarAlliance marketing group. Instead, the combination would be a member of the OneWorld Alliance, which currently counts American Airlines as a member, as well as British Airways.
BA's parent, IAG, was said last year said to be weighing a stake in American but this is now considered unlikely as American emerges from bankruptcy protection.
The US Airways chief executive, Doug Parker, is likely to head the merged entity.
- 1 Benedict Cumberbatch says Hollywood is better for black British actors
- 2 Man who held up 'hire me' sign at Waterloo station returns a year later with 'I'm hiring' sign
Rowan Atkinson to sell £10 million McLaren 'supercar' he crashed into a tree and a lamppost
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
US blames Russia after rocket attacks in Ukraine kill at least 30
Warriors in ancient Iraq suffered Post-Traumatic Stress Disorder more than 3,000 years ago, say researchers
Nigel Farage: NHS might have to be replaced by private health insurance
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
George Galloway condemns 'racist, Islamophobic, hypocritical rag' Charlie Hebdo at freedom of speech rally
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...
£16000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...