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Behind the Scenes of the American Airlines/US Airways Merger Talks | Corporate Counsel (Sue Reisinger)

Behind the scenes of the proposed $11 billion merger between American Airlines Inc. and US Airways Group Inc. are groups of in-house and outside counsel struggling with the myriad legal issues involved in creating the world’s largest airline. But they won a unique victory last December when marathon negotiations ended in an agreement with both companies’ pilot unions.

“This deal culminated after a fairly dramatic, two-week, round-the-clock, multi-party negotiating process in a room in Dallas over the Christmas [holidays],” recalled labor lawyer Robert Siegel. He is a partner at O’Melveny & Myers and was representing US Airways.

“Well, we did take some sleep breaks,” Siegel corrected himself, “but there were some all-night efforts, and all of them were late-night efforts.” Fortunately the negotiating room was located in law offices across the street from the hotel.

He said the deal helped pave the way for the two airlines to announce their approval of the merger on February 14. It still must pass federal antitrust and bankruptcy court scrutiny.

What made the agreement unique were two factors. First, the deal was cut as part of the merger negotiations while American Airlines was still in Chapter 11 proceedings in U.S. Bankruptcy Court for the Southern District of New York.

via Behind the Scenes of the American Airlines/US Airways Merger Talks.

American Airlines, US Airways unveil $11 billion merger | Reuters

American Airlines and US Airways Group said they plan to merge to form the world’s biggest airline with a combined equity value of $11 billion.

The widely expected merger caps a wave of consolidation that has helped put U.S. airlines on more solid financial footing.

The merged airline will be majority owned by creditors, unions and employees of American parent, AMR Corp, which filed for Chapter 11 bankruptcy in November 2011.

The airline – to carry the American Airlines name – would be 2 percent larger than current No. 1 United Continental Holdings Inc in traffic, as measured by the number of miles flown by paying passengers worldwide.

“By utilizing American’s connecting network with penetration into smaller markets, and global alliance revenues, the new company could more effectively raise revenues and reduce costs, while addressing labor integration and capital problems,” Sterne Agee & Leach analyst Jeffrey Kauffman said in a note before the deal was announced on Thursday.

The new American will be based in Dallas-Fort Worth and will be headed by US Airways Chief Executive Doug Parker, who has long advocated industry consolidation. US Airways began its pursuit of a merger in early 2012.

via UPDATE 2-American Airlines, US Airways unveil $11 billion merger | Reuters.