American Airlines Takeover Nears


A number of press reports say that U.S. Airways Group Inc. (NYSE: LCC) will take over the airline operations of bankrupt AMR. The marriage of U.S. Airways and American Airlines would create one of the largest carriers in the world. But travelers and consumer advocates have reason to worry about the effect of the deal.

The merger of Delta Air Lines Inc. (NYSE: DAL) and Northwest Airlines, as well as the marriage between Continental Airlines and United Airlines to form United Continental Holdings Inc. (NYSE: UAL), have produced large numbers of complaints about ground service and reservation systems. As has been true with most airline mergers, these problems will take years to sort out.

The media's focus on the merger has not concentrated on the future of the two airlines. Rather, the headlines have been dominated by whether AMR CEO Thomas Horton or U.S. Airways CEO Doug Parker will run the corporation once it is formed.

Filed under: 24/7 Wall St. Wire, Airlines, Mergers and Buy Outs Tagged: DAL, LCC, UAL