US Airways (LCC), AMR (AAMRQ) Said to Be Finalizing Details in Potential Merger

February 7, 2013 11:59 AM EST
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US Airways (NYSE: LCC) and AMR Corp (OTCBB: AAMRQ) have been in talks over a potential deal for what seems like ages. Those discussions may be coming to a head soon however, with a potential deal expected to be announced within weeks.

Reports out Thursday have the two sides working to hammer out the last major details, aiming to finalize a deal soon.

The market cap of the combined company could surpass $10 billion, placing it ahead of United Continental (NYSE: UAL) as the largest airline in the U.S. by traffic, according to WSJ-compiled data.

Talks could fall apart, with decisions about management structure, ownership split, how AMR's creditors would be treated in bankruptcy court, and board seats still on the table. AMR has also expressed plans to emerge from bankruptcy at various points throughout negotiations, halting progress at various points through the process.

While US Airways has suggested about $1.2 billion in additional revenue and cost synergies if the two companies should merge, AMR has repeatedly come up with a number lower, yet another sticking point in the talks.

US Airways CEO Doug Parker could remain in that position for the combined company, while AMR CEO Tom Horton may become non-executive chairman.

Shares of US Airways are up 1.7 percent as investors remain hopeful Thursday.

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