NEW YORK: American Airlines and US Airways announced a long-expected merger yesterday that would create the largest US airline, giving them more weight in an industry that has steadily consolidated in recent years.
The marriage would establish a huge carrier with more than 1,500 aircraft, able to compete head to head with powerful rivals United Airlines and Delta Air Lines.
It would also help lift American parent AMR Corp from bankruptcy reorganization, where it has been since November 2011.
Following American’s emergence from bankruptcy and the execution of the deal, US Airways will hold approximately 28 percent of the company, with American interests holding the rest, and the fleet will fly under the name American Airlines.
In a statement the companies valued the deal at $11 billion in implied equity value and predicted it would result in combined synergies of more than $1 billion.