MIAMI (CBSMiami) – One of South Florida’s largest employers will likely get larger this week when American Airlines and US Airways are expected to announce a long-awaited merger. The merger would create the country’s biggest airline if it was approved by regulators.
Officials with American Airlines’ parent corporation were scheduled to meet Monday and directors of US Air were scheduled to meet over the weekend to help iron out final details involved with the size of the merger.
The two sides have been hung up on two major issues – the division of ownership and management roles, according to people who have spoken on the condition of anonymity.
Negotiators have settled on a split that would give a little more than 70 percent of the new company’s stock to AMR bankruptcy creditors and the rest to US Airways shareholders. US Airways CEO would run the new company which would keep the American Airlines name.
The likely merger could mean the end of the massive consolidation through mergers that have taken over the airline industry in the last decade. According to the New York Times, since 2001, there have been five major mergers reducing the numbers of main carriers to three along with a handful of low-cost carriers like Southwest and Jet Blue.
American Airlines has been in bankruptcy protection for more than a year, but is still the country’s third-largest airline, while US Airways is fourth-largest.
Once a deal is agreed to by both parties, a bankruptcy judge would still have to approve the final details and it would have to get approval from federal regulators.
(TM and © Copyright 2013 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2013 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)