American Airline and US Air Way

Satisfactory Essays

In March 2012, American Airlines was looking for a merger with another airline under Chapter 11 Bankruptcy Protection. American Airline’s CEO Tom Horton announced that the airline was ready and open to merge. Meanwhile, the parent of US Air Way, US Air Way Groups had showed the interest in taking over the parent company of American Airlines, AMR Corporation since January. US Air Way expressed that the merger would be a great opportunity for American Airline to merge and save over 1.5 billions per year in added to revenue and reducing cost. American Airlines ‘s stakeholders and shareholders supported this merge between two airlines. In February 2013, American Airlines and US signed the deal worth $11 billion and officially announced to merge two airlines. The new merged airlines would be the world’s largest airline under American Airline name, and it would rename the new corporation as American Airlines Group Inc. Internationally, it would have 100,000employees serving mostly 6700 flights to over 330 destinations in over 50 countries daily after the merger. Also, it planned to have new delivery of 517 narrow body and 90 wide body aircrafts. More specifically, the AMR Corporation’s stakeholders would take 72% of company shares, and US Airways shareholder will take the rest of 28 % company share. Judge Sean Lane approved the merger on March 27, 2013. On July 12, 2013, US Airway shareholders accepted and approved the merger. This merger would bring more benefits to customers.

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