LITTLE ROCK — AMR Corp., the bankrupt parent of American Airlines, and US Airways Group Inc. are moving closer to a merger, and a decision is possible early next month, people familiar with the matter said.
Teams from each carrier are discussing how to combine departments, including personnel, compensation and severance, said the people,who asked not to be identified because details are private. AMR’s board will meet Jan. 9 to decide whether to go ahead, with an announcement possible within days, the people said. They said that talks may yet be scuttled or delayed.
The push follows AMR’s efforts to reorganize in bankruptcy before a merger and US Airways’ quest to lead a takeover that would create the world’s largest airline. The chief unresolved issuespending with AMR’s unsecured creditors committee, which must approve any exit plan, are how to divide the equity in a new company and who would run it, three people said.
US Airways President Scott Kirby and Denise Lynn, senior vice president for people at American, have been involved in talks with pilots from each carrier, along with Jack Butler, the attorney for the creditors’ panel, two peo-ple said.
An agreement may be completed this week on work rules for each pilot group until a joint contract is negotiated with a merged carrier, one person said. Kirby is leading the merger analysis for US Airways Chief Executive Officer Doug Parker, people familiar with his role have said.
AMR is “actively taking part in ongoing discussions” with its pilots, US Airways and the smaller airline’s pilots, Michael Trevino, a spokesman, said in a response to questions about department-level planning, the board and a possible merger announcement by the carrier, based in Fort Worth.
US Airways declined tocomment about meetings with AMR, said Todd Lehmacher, a spokesman for the airline, based in Tempe, Ariz.
Parker, Kirby and Butler met Wednesday with the board of the US Airline Pilots Association, which represents US Airways pilots, in Charlotte, N.C., said James Ray, a union spokesman. He declined to comment on the substance of the talks. Lehmacher also declined to comment.
AMR CEO Tom Horton has said the company’s future should be resolved “soon,” after completing contract changes that provided $1.06 billion in labor savings, and that he hasn’t ruled out a merger. In the past, he backed a stand-alone bankruptcy exit, with tie-ups to be considered after that.
He met last week withthe Allied Pilots Association board to discuss AMR’s progress in bankruptcy and plans for the future that include adding about 550 new jets to replace aging planes and increasing international service to attract more business fliers.
After becoming CEO when AMR filed for bankruptcy, Horton focused first on the idea of remaining independent.
US Airways began pursuing a merger in January and said in April that its bid was backed by unions for American’s pilots, flight attendants and mechanics and baggage handlers.
A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways would surpass United Continental Holdings Inc. as the world’s largest airline, based on passenger traffic.
Business, Pages 28 on 12/21/2012