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American Airlines, US Airways Merger Talks Get Off the Ground

by The Associated Press Aug 31st 2012 10:23AM
American Airlines, US Airways Start Merger TalksBy SCOTT MAYEROWITZ

NEW YORK -- American Airlines and US Airways are one step closer to a potential merger.

The companies said Friday they signed legal documents allowing them to confidentially exchange information. But a deal is still far from reality.

"It does not mean we are merging -- it simply means we have agreed to work together to discuss and analyze a potential merger," US Airways CEO Doug Parker said in a letter to employees Friday.

Such a merger would put the combined airline on par with the world's largest - United Continental Holdings -- and the slightly smaller Delta Air Lines.

Parker has been pushing for a merger since American's parent company, AMR Corp., entered Chapter 11 bankruptcy protection on Nov. 29, 2011. American Airlines CEO Tom Horton has said his airline is weighing several options, including remaining independent or merging with one of several airlines, including US Airways Group Inc.

In a note to all American Airlines managers Friday, the airline said it is cutting its expenses in bankruptcy court and is "also now looking at other strategic options that could make the new American even stronger."

The signing of non-disclosure agreements means the companies will not share their discussions with outside parties. The airlines warned in a joint press release that they will not "provide any further announcements regarding the status of any such discussions unless" a merger is ready to be announced or if the talks fall apart.

US Airways' stock price rose nearly 4 percent to $10.89 shortly after the market opened Friday. The merger talk announcement came before trading began.


Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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34 Comments

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Robert L.

Lesson lost? America, United Airlines could not effectively manage their downsized (smaller) airline; with all due respect for stupidity, they doubled their size with a merger that suckered there employees and service to the public.

........................................................This merger is now an airline swamp...........................................................

Is This American Airlines thing "monkey see, monkey do".

The public deserves somthing much better than that costly, cattle-crowded container and it disenfranchisement of consumer-satisfaction benefits. This sector of the so-called "private sector" is a bust.

September 02 2012 at 9:37 PM Report abuse rate up rate down Reply
lacabrera

Didn't know that the Air Lines were Republican ,,Poor George Bush is paying for Everything ,Everybody does Stupid People ,just don't know when to stop !!

September 02 2012 at 6:50 PM Report abuse rate up rate down Reply
dnmbear

Two losers get married! WOW, and neither are any good with the traveling public. Both have been struggin since Robert Crandall "booked" with all that 80 million plus! He knew that the "cow" was gonna run dry, and got the hell out fore it fell on him! HMMMM, Wonder why CEO"s always think they are worth so much?

September 02 2012 at 4:26 PM Report abuse rate up rate down Reply
jmslotnick

How American Airlines can merge with any other airlines is unimaginable unless the other airline takes over the teaching of manners and major essentials to run a good airline. American employees have the rudest and worst in the world and I had such a bad experience with them 15 years ago I have never flown with them again.

September 02 2012 at 12:25 PM Report abuse rate up rate down Reply
up.yours

One mor way to screw the public...

September 02 2012 at 12:21 PM Report abuse +1 rate up rate down Reply
tcorchid

Hope the meger improves American Airlines customer service. We were stranded overnight in Chicago because the boarding clerk would not look for our tickets on a rebooked flight. She treatened me with security if I didn't leave. Turns out the tickets were right there on her desk but she wouldn't look past her computer to find them. thanks for the lousy ending to a trip we saved years for ... If there was train transportation within 150 miles we would take it.

September 02 2012 at 12:12 PM Report abuse rate up rate down Reply
alfredschrader

I built jetliners for 19 years. These decisions are always up in the air . To the commenters complaining about the higher fares. Ryan Air has it all figured. You stand up during the flight. But, I took it to the next level. I removed everything inside of the plane saving tons of weight. No luggage is allowed, we send everything by UPS airfreight and throw it out in a fly-over, no airfield landing fees, no gas guzzling take-offs. The snaks are on a piece of plywood suspended on a clothesline that runs the full length of the cabin. As it goes by, you select peanuts or chips and place $5.00 in the cup. All purchases are recorded by a cell phone CCD camera. The stewardess also flies the plane, no pilot, no co-pilot. She is the pilot. No fasten seat belt light or demonstrations or pillows even exist. The plane itself is the flotation device. A recorded voice playback on a Radioshack model 3 tape recorder tells you everything you need to know. Restroom use is free, but you buy the restroom tissue in packets off the plywood board for 50 cents. Sorry, no refunds on anything. Flying on Ryan Air is considered historical entertainment, and as such non-refundable. Enjoy your flight.

September 01 2012 at 6:32 PM Report abuse rate up rate down Reply
burnsengine

Another opportunity for US (the consumer) to have fewer choices.... which, in the long run, means higher fares and fewer opportunities.
I think it's time for M&A to take a break.

September 01 2012 at 2:03 PM Report abuse rate up rate down Reply
1 reply to burnsengine's comment
burnsengine

I thought I would never say this: but where IN THE WORLD is Krantz!!!??
He might have been goofy - but he knew how to run an airline.

September 01 2012 at 2:05 PM Report abuse +1 rate up rate down Reply
aaflyboy1

I JUST HAVE TO LAUGH, YOU PEOPLE WANT CHEAP AIRFARES.
PAY THE AIRLINE EMPLOYEES BILLS, THAN WE WILL GIVE YOU CHEAP AIRFARES!
YOU WANT CHEAP AIRFARES, GO TO SPIRIT AIRLINE.COM
ALL YOU SPOILED BUSINESS TRAVELERS WILL ENJOY THOSE COMFORTABLE PLANES AND INFLIGHT SERVICE!!!
WAKE UP YOU IDIOTS!
AIRLINE EMPLOYEES HAVE GIVEN SO MANY TIME TO "HELP SAVE" THE AIRLINE!
ITS THE REPUBLICAN CEOS AND THERE GREED THAT DESTROYED GREAT AIRLINES NOT THE PEOPLE WHO COME TO WORK AND FLY YOUR MISERABLE ASSES AROUND THE WORLD ( CONSTANT COMPLAINING AND LOOKIN FOR FREEBIES AND UPGRADES! THAN, WHEN YOU GET THE UPGRADE, YOU STILL COMPLAIN!)

September 01 2012 at 1:25 PM Report abuse +1 rate up rate down Reply
1 reply to aaflyboy1's comment
visconti24

If you learned how to write and found out how to undo the caps lock perhaps your point would be more comprehensible. As it is, it is a jumble that does not help your argument.

September 02 2012 at 8:59 PM Report abuse rate up rate down Reply
aaflyboy1

FIRST OFF, THE AIRLINE EMPLOYEES ARE TIRED OF SUBSIDIZING LOW COST TRAVEL!!!
YOU WANT TO SEE AUNT BETTY LOW IN EULESS TEXAS? I NEED MONEY TO PAY MY BILLS,ETC.
AIRLINE EMPLOYEES PAY FULL PRICE FOR ALL THE GOOD AND SERVICES WE NEED!
SO, YOU WANT TO TRAVEL? START PAYING!!! THE DAYS OF $69.00 AIRFARES ARE GONE!
REGARDING A MERGER WITH USAIR. USAIR EMPLOYEES WILL STAY AT THERE BASES AND AMERICAN STAY AT THERES!
TWA WAS ANOTHER STORY, AMERICAN GOT NOTHING FROM TWA!! EXCEPT EMPLOYEES WHO WERE GIVEN FULL SENIORITY WAGES, VACATION AND SICK TIME! (BIDDING WAS ANOTHER STORY! WHY? AMERICAN DID NOT GET ANY ROUTES FROM TWA THAT THEY USE! ZERO!) N JUST OLD EMPLOYEES AND OLD DIRTY PLANES!
NOW, USAIR AND AMERICANS UNIONS ALL READY HACE AGREEMENTS WHICH WE BOTH AGREE TO!
SO, IF YOU THOUGHT FOR A SINGLE MOMENT THAT GRANDMA AND GRANDPA FROM TWA ARE GOING TO BUMP THE AMERICAN EMPLOYEES FROM THEIR NEW AIRCRAFT AND ROUTES WE HAVE FLOWN FOR YEARS! YOUR CRAZY!!!! AND DUMB!!!
SO AUNT BETTY LOU, YOU MAY HAVE TO SEND MONEY TO THE KIDS IN ORDER FOR THEM TO COME HOME FOR THE HOLIDAYS!

September 01 2012 at 1:16 PM Report abuse +1 rate up rate down Reply
1 reply to aaflyboy1's comment
visconti24

If airline employees are "tired of subsidizing low cost travel," they should get out of such nasty business, don't you think? Why work where you are unappreciated, disrespected and make no money? If airlines lost 25% of their employees, I am sure they would hurry up and make the jobs more attractive in terms of salaries, benefits and "respect."
You, rightly, do not want to subsidize cheap travel. I do not want to subsidize poor service, dirty planes, surly employees, lost bags. I spend my dollar where I am welcome.

September 02 2012 at 9:04 PM Report abuse rate up rate down Reply