The deal was approved by the boards of both companies earlier in the week and it is expected to close in the third quarter of this year. The new airline will take the American Airlines name but current CEO of US Airways, Doug Parker, will run it at least until its first shareholder meeting, which is expected to be held in mid-2014.
The joining of these two airlines is expected to create the world’s biggest airline and represents the seventh such merger in the industry, which has suffered from rising fuel prices and strong competition.
On announcing the deal the two companies said that they expect to see some $1bn in combined benefits and cost savings of around $150m.
In a statement, Doug Parker said: “The combined airline will have the scale, breadth and capabilities to compete more effectively and profitably in the global marketplace.
“Our combined network will provide a significantly more attractive offering to customers, ensuring that we are always able to take them where they want to go.”
The only concern for US business travellers is whether this deal increases ticket prices.
Speaking to CBSNews Rick Seaney, CEO of FareCompare, an airfare comparison site said: “Even though people say this particular merger of US Airways and American Airlines isn’t going to raise ticket prices, I don’t believe that one bit.”
