|
|
|
MailTribune.com
  • Judge signs off on airline merger

    American Airlines, US Airways can proceed; executive's $20 million severance plan nixed
  • U.S. Bankruptcy Judge Sean Lane on Friday made official a ruling he gave from the bench March 27, signing an order approving the merger of US Airways Group Inc. and American Airlines parent AMR Corp.
    • email print
  • U.S. Bankruptcy Judge Sean Lane on Friday made official a ruling he gave from the bench March 27, signing an order approving the merger of US Airways Group Inc. and American Airlines parent AMR Corp.
    The only part of the merger proposal that wasn't approved was the nearly $20 million in severance that was to go to Tom Horton, AMR and American Airlines' chairman, president and chief executive, upon completion of the merger.
    Lane, who is presiding over the AMR-American bankruptcy cases, previously had issued a "memorandum of decision" explaining why Horton's severance was beyond the limits allowed by a 2005 federal law.
    But in Friday's order, Lane said his decision "is without prejudice to the consideration and approval" of the severance terms at a later date. "We're pleased with the court's written approval of the merger agreement, as it allows us to continue progressing forward with our planned merger with US Airways," American Airlines spokesman Mike Trevino said.
    With Lane's order now issued, the next big hurdle is to get regulators' approval. The merger is under review by U.S. Department of Justice antitrust lawyers, and also by European regulators.
    Executives at American and US Airways have continued to say they expect the deal to close in the third quarter, most likely in September.
    On May 6, Horton and Doug Parker, US Airways' chairman and CEO, told the two airlines' employees that the top leadership team of the combined carrier soon will be made known. Parker will be CEO and Horton will be board chairman for a maximum of a year.
Reader Reaction

      calendar