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AMR, US Airways near merger deal

NEW YORK/DALLAS - The boards of American Airlines parent AMR and US Airways Group are prepared to vote on a merger tomorrow as executives and advisers work on final terms this weekend, people familiar with the matter said.

By Jeffrey Mccracken, Mary Schlangenstein And David Mclaughlin (Bloomberg)

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Published: Sun 10 Feb 2013, 9:31 PM

Last updated: Fri 3 Apr 2015, 3:02 AM

The sides have agreed that AMR’s bankruptcy creditors would get 72 pe rcent of the equity in the new carrier, with 28 per cent for US Airways shareholders, said two of the people, who asked not to be identified because the talks are private. US Airways chief executive officer Doug Parker will run the airline as AMR CEO Tom Horton becomes non-executive chairman, the person said.

Horton’s tenure in that post is still being negotiated, and will be limited to one or two years, one of the people said. AMR’s bankruptcy creditors committee is poised for a vote early this week on any merger accord, with an announcement as soon as Tuesday, two people said.

Leadership and the division of the equity had been the final major issues in the discussions, people familiar with the talks have said. A tie-up between American, the third-largest US airline, and No. 5 US Airways would create the world’s biggest carrier by passenger traffic.

American declined to comment on the deliberations, said Mike Trevino, a spokesman for the Fort Worth, Texas-based carrier. Kelly Sullivan, a US Airways spokeswoman who works for public-relations firm Joele Frank, Wilkinson Brimmer Katcher, also declined to comment. Jack Butler, an attorney for the creditors committee, didn’t respond to an e-mail or phone call seeking comment.

Besides the split of equity between AMR creditors and US Airways investors, the proposed merger calls for existing AMR stockholders to get shares in the combined company, two of the people said. Details of that plan are still being negotiated, one person said.