The board of Directors of US Airways Inc. (LCC: Quote) and American Airlines parent AMR Corp. (AAMRQ.PK) approved the merger plan separately on late Wednesday, according to people familiar with the matter.
The official announcement is planned for early Thursday. The marriage, which will create the world's largest air carrier, is likely to have a market value of around $11 billion.
As per the all-stock deal's terms, American Airlines will own 72 percent of the combined airline, and US Airways shareholders will possess the remaiing stake. The new airline will be run by US Airways CEO Doug Parker and American Airlines' CEO Tom Horton will become the chairman, according to sources.
The deal would serve as the reorganization plan taking American out of bankruptcy proceedings. AMR and some of its subsidiaries, including American Airlines and American Eagle, had filed for Chapter 11 bankruptcy protection in November 2011.
LCC closed the Wednesday's trading session at $14.66, up 2.73%. In the after-hours trading, the shares grew 1.64% and ended at $14.90. AMR corp. shares closed at $1.30, up 3.59% on Wednesday.
by RTT Staff Writer
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