American and US Airways Boards Approve Merger

by James Andrew Scott on February 13, 2013

in AAdvantage, American Airlines, Dividend Miles, US Airways

It’s official.  Today, the Wall Street Journal is reporting that the boards of American Airlines parent AMR Corp. and US Airways Group, Inc. have separately approved an agreement merging the two airlines.  The deal will be announced tomorrow.

US Airways CEO Doug Parker will head the merged airline, which will be the world’s largest by passenger traffic.  The merger was widely expected given the ongoing consolidation in the airline industry.  US Airways in particular lacked the size to compete with the much larger United Airlines (which completed its own merger with Continental last year) and Delta Air Lines.  Following the merger, American Airlines’ creditors will own 72% of the shares in the airline with US Airways shareholders owning the remainder.

It is expected that the airline will use the more widely recognized American Airlines’ name and maintain the AAdvantage loyalty program.  US Airways Dividend Miles members can expect to be eventually merged into the AAdvantage program.  American is currently engaged in a re-branding effort and recently unveiled a new logo and plane livery.

 

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