American Airlines' merger with US Airways Group Inc. was approved by U.S. Bankruptcy Judge Sean Lane, Bloomberg News reported yesterday. Fort Worth, Texas-based American and US Airways, based in Tempe, Ariz., announced the merger in February. US Airways began its pursuit of a deal in January 2012, less than two months after American parent AMR Corp. filed for bankruptcy. The merger with US Airways will create the world’s largest carrier and will be completed through a bankruptcy reorganization plan for American. That plan requires creditor support and separate approval from Judge Lane. The court hearing to approve the bankruptcy plan should occur in about six months, said Stephen Karotkin, an attorney for American. Read more:
http://www.bloomberg.com/news/print/2013-03-27/amr-s-merger-with-us-air…
In related news, Bankruptcy Judge Sean Lane said that it would be "inappropriate" to approve a $20 million exit package for the outgoing chief executive of American Airlines parent AMR Corp., calling it his only "hang-up" as he cleared the way for a merger with US Airways LCC Group Inc., the Wall Street Journal reported today. Judge Lane yesterday granted American's request to send the merger plan to the airline's creditors for a vote. AMR CEO Tom Horton, though, will have to wait for approval of the $19.9 million severance negotiated as part of the merger agreement. Once the merger is approved by creditors and antitrust regulators, Horton will become nonexecutive board chairman of the new company, called American Airlines Group Inc., until spring 2014. U.S. Trustee Tracy Hope Davis objected to Horton's severance package, calling it in court papers an "end run around" a federal law that limits retention bonuses and other payments to executives running firms under chapter 11 protection. Read more. (Subscription required.)
http://online.wsj.com/article/SB100014241278873235010045783868540946967…