European Union Approved Merger of US Airways Group and AMR Corporation
European Union on 5 August 2013 approved merger of US Airways Group and AMR Corporation. This will form the largest airline of the world.
European Union competition authorities on 5 August 2013 approved the merger of US Airways Group and AMR Corporation. This will form the largest airline of the world after merger. The merger was cleared under the EU Merger Regulation.
The decision came with condition that the merged company will help in paving way for more competition on London-Philadelphia route. It is important to note that on this route, a joint venture with British Airways and Iberia helps in creating monopoly.
AMR Corporation, parent company of American Airlines and the US Airways Group on 14 February 2013 had confirmed about their merger plans. The combined company will have an equity value of approximately 11 billion US dollars. The net combined debt of these companies would be somewhere around 15 billion US dollars.
The deal was approved by the board of two companies. The deal came 15 months after the AMR Corporation sought for protection in November 2011. The US Airways chief executive, Doug Parker would be the chief executive of this new company. Tom Horton, AMR’s chief executive on the other hand will be the temporary non-executive chairman.
The operation of these two companies will take place from their respective parent hubs only.