Here's What Could Make the AMR-US Airways Merger a Success


After months of negotiations and handwringing, US Airways and AMR Corp. have agreed to merge. Current US Airways chief Doug Parker will lead the carrier, which will carry the American Airlines brand and updated livery.

Parker's ascent is unusual, in that current AMR stakeholders -- notably bondholders and creditors who've been positioning for a claim on the carrier's assets in bankruptcy -- will own 72% of the combined carrier. Equity holders get 3.5% of that stake.

Plenty of investors dislike the deal. Shares of US Airways fell 7% in Thursday morning trading, perhaps echoing the sentiments of the Fool's Sean Williams, who predicted that the combined carrier would become the "worst company ever."

Is he right? Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova says there's more to the story, and cites one strategy Parker could take to boost profits measurably over the short and long-term. Click the video below to learn more, and then leave a comment to let us know what you think.

Airlines are one of many industries subject to the whims and whimsies of oil prices. If you're on the lookout for some profitable alternatives, check out The Motley Fool's 3 Stocks for $100 Oil. You can get free access to this special report by clicking here.

The article Here's What Could Make the AMR-US Airways Merger a Success originally appeared on

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's web home and portfolio holdings, or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.