logo  
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

US Airways Shareholders Give Go Sign to Merger with American Airlines

By  +Follow July 12, 2013 1:16PM
Share:
Tickers Mentioned:

The merger between US Airways Group, Inc. (LCC) and American Airlines parent AMR Corporation (AAMRQ) that would create the world’s biggest airline got a step closer to realization on Friday as US Air reported shareholder approval of the deal.  US Airways made the announcement from what could be its last shareholder meeting, being held in New York City.

The $12.8-billion stock deal was first announced in February, with expectations that the transaction would be completed by the end of September.

US Air said that of 132,788,060 votes received, representing over 99 percent of LCC stock, 132,273,780 voted in favor of the merger.  257,757 voted against and 256,523 abstained.

"By bringing together two highly complementary networks and generating significant revenue synergies, the new American Airlines will deliver enhanced value for its shareholders,” said Doug Parker, chairman and chief executive of US Airways.  Upon completion of the merger, Parker will be seated as CEO of the combined company.  AMR’s current CEO, Tom Horton, will assume the role of nonexecutive chairman of the merged company, at least for a short period.  The merged company will be headquartered in Dallas-Forth Worth and keep the American Airlines name.

It’s estimated that the large carrier will operate 950 aircraft, employ more than 100,000 employees and offer in excess of 6,700 flights daily to 336 destinations in 56 countries.

The deal still has to win approval of several other antitrust authorities, including the U.S. Department of Justice, the European Union and the bankruptcy court overseeing AMR Corp.’s restructuring.  Overrun by debt and unable to secure a cost-cutting labor agreement, AMR filed for Chapter 11 bankruptcy protection in November 2011.  A federal judge has scheduled a hearing for August 15 to finalize the AMR plan to emerge from bankruptcy.

The merger will give AMR creditors 72 percent of the new company, leaving current US Airway shareholders with 28 percent.

The Justice Department has in the recent past approved the mergers of Delta Air Lines Inc. (DAL) and Northwest, Southwest Airlines Co. (LUV) and Air Tran and United Airlines (UAL) and Continental.  To that end, most expect the American/US Airways deal to go through.

There has been speculation that the US DOJ may want the new American Airlines to give up some of its takeoff and landing slots at Reagan National Airport outside Washington, D.C.  Parker has said he doesn’t think that will be a requirement.  In 2010, the DOJ made Continental sell slots at its Newark, New Jersey hub to Southwest as a contingency to approval in the merger deal with United.

Protestors, including members of the Service Employees International Union wanting higher pay for airport workers, gathered outside building where the US Airways meeting was being held.

Shares of AAMRQ have put together a strong climb in 2013, appreciating more than 500 percent.  At 2013 highs of $7.15, shares were up a whopping 800 percent in May.  With today’s news, shares have inched up 2 percent to $4.96 halfway through the trading day.  Shares of LCC are up by 2 percent as well at $17.76, putting shares ahead about 40 percent so far in 2013.





DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


Liked What You Read? Join Equities.com as a contributor and get eyeballs on your content FOR FREE!

Results for lcc
Harry Walkman
26 Feb 15 15:04:39
$LCC A year into USAir merger, American Airlines is flying high http://t.co/4PcIz6ACeN
Jeffrey Blake
26 Feb 15 15:04:38
$LCC Fitch Rates American Airlines Group Inc. Notes 'B+/RR4' http://t.co/hB4oCCXOUL
$Stocknewsalerts
26 Feb 15 08:42:40
$LCC ALERT: New American Airlines Group Inc SEC Filing From our Stock News Alerts App
$Stocknewsalerts
26 Feb 15 04:53:31
$LCC American Airlines Group Announces Proposed Offering of Unsecured Senior Notes From our Stock News Alerts App
Jack Trader
25 Feb 15 11:02:49
$LCC American Airlines Group Inc (AAL) Stock Has 50% Upside: Barron's http://t.co/ijlghjNfRk
John Turner
25 Feb 15 11:02:48
$LCC A year into USAir merger, American Airlines is flying high http://t.co/CfESCVlYOy
$Stocknewsalerts
25 Feb 15 05:14:53
$LCC ALERT: New American Airlines Group Inc SEC Filing From our Stock News Alerts App
chartguy89
24 Feb 15 06:46:14
LCC +0.54% Stock Charts $LCC LC Corp. S.A. (WAR) Last Updated: 02/24/2015 08:46:18 LCC Stock Chart - 1 Month h http://t.co/m5s1KgU1lX
$Stocknewsalerts
24 Feb 15 06:34:14
$LCC American Airlines To Webcast Presentation At J.P. Morgan Aviation, Transportation & Industrials Conferen From our Stock News Alerts App
BBY Limited
22 Feb 15 21:41:10
CONT: The big banks led the way today, $ANZ +0.66% the best performer. Among those reporting, $LCC +0.89%, $BXM +0.19%. #ausbiz #ozearnings
Clair Voight
20 Feb 15 09:04:01
$LCC American Airlines, US Airways Pilots Approve Joint Contract http://t.co/hbRbfQhbJE
Thomas Collins
20 Feb 15 09:03:58
$LCC A year into USAir merger, American Airlines is flying high http://t.co/6tWeHGAACr
$Stocknewsalerts
20 Feb 15 09:02:30
$LCC American Airlines Becomes The Official Airline Partner Of The Los Angeles Clippers From our Stock News Alerts App
Jack Trader
19 Feb 15 13:02:17
$LCC American Airlines, US Airways Pilots Approve Joint Contract http://t.co/vm9xRQWT4l
Irma Doucet
19 Feb 15 13:02:15
$LCC A year into USAir merger, American Airlines is flying high http://t.co/NB8KHc4tZz
				
				
By  +Follow July 12, 2013 1:16PM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.