US Airways/America West merger talks in final stage
Bankrupt US Airways and America West are entering a critical and final stage with announcements expected in next few days.
“We don’t have many other options left. This is it,” said a US Airways Group Inc. executive who spoke on condition of anonymity because of the sensitivity of the negotiations, reported the Washington Post.
Sources briefed on the negotiations said several important details remain to be worked out, reported USA Today.
Since both airlines are cash poor, a successful conclusion of the pending $1 billion rescue loan from a consortium of lenders, including Airbus, Air Canada, Air Wisconsin, General Electric and hedge funds is critical to the merger talks.
It is anticipated that the merged airlines would operate under the better-known name of US Airways. Doug Parker, America West’s CEO, and his senior management team in Arizona are expected to fill the top spots. This could move some of the 1,970 Washington-based jobs out of the Washington region
The emergence of Airbus as a principal backer apparently added significant momentum to merger talks, says USA Today.
US Airways has 126 Airbuses, plus orders for 29 more. America West has 89 and orders for 34.
A combined US Airways-America West would be better able to compete with discount rivals and complement each other geographically, US Airways’ Chairman David G. Bronner said Tuesday night.
Charles Kao
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