American Airlines and US Airways are set to formally announce a merger Thursday morning in the United States.
The $11 billion deal, approved late Wednesday by the boards of US Airways and AMR Corp. – the parent company of American Airlines – leaves just four major carriers for U.S. travelers to choose from.
However, as a result of the merger, the newly-created “American Airlines,” to be run to US Airways CEO Doug Parker will become the world’s biggest airline, edging ahead of United Airlines with slightly more passenger traffic.
If the deal is approved by a bankruptcy judge and anti-trust regulators, the new airline will control more than 3,200 daily flights on more than 900 aircraft, with more than 95,000 people in its primary airline, not including regional affiliates.
Sources who requested anonymity said current American Airlines CEO Tom Horton will continue as chairman of the new firm until at least mid-2014.
AMR is been restructuring under bankruptcy protection since late 2011, as pressure from creditors forced the company to consider whether to work towards creating a new independent airline, or to go for a merger.
Under the plan approved by the two boards Wednesday night, AMR creditors – and perhaps the shareholders – will own up to 72 percent of the company’s stock. Shareholders in the US Airways Group will own the rest.