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AMR Corp., the bankrupt parent of American Airlines, says that its value has "significantly appreciated" and there may be value for shareholders, Bloomberg News reported yesterday. AMR, which is considering a merger with US Airways Group Inc., notified the Office of the U.S. Trustee of the development in a Jan. 3 letter filed today with the Securities and Exchange Commission. "Depending upon the ultimate strategic alternative adopted and pursued, there exists a reasonable possibility that there may be value for AMR equity holders," AMR attorney Harvey Miller wrote.

The chief executive of American Airlines' parent said yesterday that his company is just a "matter of weeks" away from concluding its evaluation of the potential benefits, costs and risks of a proposed merger with US Airways Group Inc. as a way out of bankruptcy court, the Wall Street Journal reported today. In a memo to employees, AMR Corp. Chairman and CEO Tom Horton cited a proposed memorandum of understanding that the union representing American Airlines' pilots reached this weekend, which would govern the way they would be integrated with US Airways' pilots should a merger occur. Horton said that discussions with the US Airways pilots and with other unions at both companies also are in progress. AMR will review the proposed memorandum of understanding with its pilots union and other factors to make "an informed decision about whether a merger should be pursued," Horton said.

Bloomberg Law Bankruptcy Columnist Bill Rochelle explores potential restructuring trends in 2013 in his latest video post. Click here to watch!

Pinnacle Airlines Corp. said yesterday that it reached agreements, including additional financing, that will allow it to emerge from bankruptcy protection as a subsidiary of Delta Air Lines Inc., the Associated Press reported yesterday. Pinnacle said that it must file a reorganization plan acceptable to Delta and other creditors by Feb. 15. The company is trying to cut costs and streamline its fleet to 81 fuel-efficient planes that it would operate for Delta, which has been pressing Pinnacle to reduce costs.

AMR Corp. sought bankruptcy court approval for restructured contracts with its aircraft and jet engines suppliers that the carrier said will help it switch to more fuel-efficient planes as part of its reorganization, Bloomberg News reported today. AMR, the parent company of American Airlines, filed redacted settlement agreements with Boeing Co., Airbus SAS, General Electric Co. and Rolls-Royce Plc. The restructured agreements will in "no way adversely impact" AMR’s pursuit of strategic alternatives, the company said in the request.

In a step that potentially could ease the way for a merger of American Airlines parent AMR Corp. and US Airways Group Inc., the board of American's pilots union approved an interim labor framework should the two carriers proceed with a combination to take AMR out of bankruptcy court protection, the Wall Street Journal reported today. After three weeks of confidential negotiations overseen by AMR's creditors committee, the Allied Pilots Association board on Saturday voted 11-5 in favor of a proposed accord, the union said, though terms were not disclosed. The proposal requires the assent of the other parties to the talks, including both carriers and US Airways' pilot union.

American Airlines' pilot union warned that an American Airlines merger with US Airways Group Inc. may not occur during the AMR Corp. unit's bankruptcy unless pilot groups from the carriers agree on interim contract terms, Bloomberg News reported today. If an accord is not reached “in the very near future, in all likelihood there will be no merger before American Airlines exits restructuring,” said Keith Wilson, president of the Allied Pilots Association. The pilot groups, joined by executives from both carriers, began negotiating the accord earlier this month. American, which filed for bankruptcy on Nov. 29, 2011, has said it prefers to assess mergers after it leaves court protection. US Airways has been pushing for a tie-up since January.

American Airlines parent AMR Corp. and US Airways Group Inc. are moving closer to a merger, and a decision could come early next month, Bloomberg News reported yesterday. Teams from each carrier are discussing how to combine departments, including personnel, compensation and severance. AMR's board will meet on Jan. 9 to decide whether to go ahead, with an announcement possible within days. The push follows AMR's efforts to reorganize in bankruptcy court before a merger and US Airways’s quest to lead a takeover creating the world’s largest airline. The chief unsettled issues pending 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.

AMR Corp.'s American Airlines won court approval for a new contract with its pilots union, a deal that cuts labor costs and boosts the airline's effort to exit bankruptcy protection, Bloomberg News reported yesterday. The agreement, approved at a hearing yesterday by Bankruptcy Judge Sean Lane, comes after American secured new contracts with unions representing flight attendants and mechanics as part of its restructuring. Judge Lane said that the agreement with the Allied Pilots Association is a significant step to resolving the bankruptcy case that began more than a year ago and helps achieve “long-term viability” for the airline.

American Airlines' pilots union still supports a merger with US Airways Group, a union spokesman said on Thursday, and it was unmoved by a pitch from AMR Chief Executive Tom Horton that the company should exit chapter 11 as an independent carrier, Reuters reported yesterday. Next week, US Airways CEO Doug Parker is expected to meet with the board of the Allied Pilots Association. Horton, who became CEO of American parent AMR Corp as the company filed for bankruptcy protection in November 2011, requested the meeting with the pilots union leadership and met with the board for about three hours on Thursday. US Air has been pushing for a merger with American all year, and its plan has the support of unions that represent American's flight attendants and ground workers, in addition to the pilots union. The two carriers combined would be on par with current No. 1 United Continental Holdings in scope. American Airlines creditors want a potential merger with US Airways to be an all-stock deal rather than one that pays some claims in cash. Merger discussions among US Airways, AMR and its creditors are reported to be at an advanced stage.