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American Airlines CEO Thomas Horton suggests that his management team has earned the right to keep leading the company even if it merges with US Airways, The Associated Press reported yesterday. The approval of a new labor contract by pilots last week was the last major hurdle American and parent AMR Corp. needed to clear before emerging from bankruptcy protection in the next few months. American is positioned to finish its chapter 11 restructuring faster than Delta Air Lines and United Airlines did theirs last decade. "If you look at the speed and the result of this restructuring, I think it stands apart from all the others," Horton said Monday. "This team has done an outstanding job, and I'm very proud of them." American's unions, however, are pushing for new management, and some analysts agree with them. Other airline industry observers believe Horton should run AMR, whether or not there is a merger. American and AMR filed for bankruptcy protection in November 2011. US Airways has been pushing for a merger that would put its executives in charge. But Horton said that a deal could happen after his airline emerges from bankruptcy, which raises the possibility that American could buy US Airways.

American Airlines parent AMR Corp. is open to the possibility of helping pay for its bankruptcy exit with private equity or other outside funding, Chief Executive Officer Tom Horton said, Bloomberg News reported today. AMR is close to completing its reorganization plan and its evaluation of whether to stay independent or merge with US Airways (LCC) Corp., Horton said yesterday. Financing, leadership and choosing from options including a merger and a go-it-alone approach are among the unresolved questions facing Fort Worth, Texas-based AMR. An ad hoc bondholder group with about $885 million in AMR debt has told American's pilots that its support for a stand-alone airline would be conditioned on the naming of a new board. Horton said he expects AMR to exit chapter 11 soon, without providing a timeframe. AMR has maintained the more than $4 billion in cash and short-term investments (AAMRQ) it had when it filed for bankruptcy on Nov. 29, 2011. The case is In re AMR Corp., 11-15463, U.S. Bankruptcy Court (S.D.N.Y.) (Manhattan).

American Airlines pilots approved its first new contract in more than nine years, helping the carrier secure $1.06 billion in annual labor cost cuts as parent AMR Corp. restructures in bankruptcy, Bloomberg News reported Friday. The accord was approved by 74 percent of those voting, according to the Allied Pilots Association. The six-year contract will give pilots a 13.5 percent stake in the post-bankruptcy company and annual pay raises while freezing their pensions and requiring longer work hours. Pilots are the last work group to accept pay, benefit and work-rule changes, a step toward AMR's completion of its reorganization plan. Creditors have been awaiting a resolution on labor costs to allow a comparison of the Fort Worth, Texas-based carrier's stand-alone plan for leaving bankruptcy with a merger bid by US Airways Group Inc. "This ratified agreement should not in any way be viewed as support for the American stand-alone plan or for this current management team," said Dennis Tajer, a union spokesman. "We continue to support an American-US Airways merger as the best way to strengthen our airline and enhance our pilots' long-term career prospects." The airline's 8,000 pilots rejected a previous tentative agreement with 61 percent of the vote, prompting American to throw out the existing contract and begin imposing changes to lower spending. American and its pilots last agreed on a contract in 2003, and talks on a new deal began in 2006. The case is In re AMR Corp., 11-15463, U.S. Bankruptcy Court (S.D.N.Y.) (Manhattan).

The lawyer for AMR Corp. (AAMRQ)'s unsecured creditors' committee warned American Airlines pilots of the risks of rejecting a tentative contract that would allow the carrier's post-bankruptcy plan to be weighed against a US Airways Group Inc. (LCC) merger, Bloomberg News reported today. Jack Butler of Skadden, Arps, Slate, Meagher & Flom LLP told members of the Allied Pilots Association that pilots would lose a 13.5 percent stake in a restructured AMR if the deal isn't approved. A successful vote would help the creditors' committee evaluate AMR's preferred strategy to leave bankruptcy on its own and US Airways' takeover push. Fort Worth, Texas-based AMR needs a contract with the pilots, the only union without a new accord, to determine its future costs. Negotiations have ground on since 2006 without a final agreement, even as AMR warned of bankruptcy before filing for court protection on Nov. 29, 2011. A tentative accord calling for union concessions failed in August when 61 percent of pilots voted it down, prompting American to throw out their existing contract and begin imposing terms to lower costs.

American Airlines would keep four gates at Lambert-St. Louis International Airport but shed $2.3 million a year in payments to the airport under a proposed deal with the city, the St. Louis Post-Dispatch reported yesterday. The agreement is expected to be filed next month with the U.S. Bankruptcy Court in New York, where American’s parent, AMR Corp., filed for bankruptcy protection in November 2011. Among the airlines at Lambert, American ranks No. 2 in flights, behind Southwest Airlines, with 30 departures a day to six destinations. The carrier has agreed to pay Lambert $722,811 in debt from before the bankruptcy filing and other pending amounts that are still due the airport, officials said. Airport officials were unable to estimate how much American will pay before and after approval of the settlement, but under the agreement, American has agreed to pay about 40 percent of its $542,072 annual share of terminal improvements. Lambert officials plan to file a claim in bankruptcy court for the remaining 60 percent. AMR has requested that the bankruptcy court extend the deadline for its reorganization plan until March 11.

Hawker Beechcraft's disclosure statement and reorganization plan, which includes emerging from bankruptcy as a smaller, stand-alone company, has been approved by the U.S. Bankruptcy Court for the Southern District of New York, the Wichita (Kan.) Eagle reported today. The approval from the court paves the way for the company to begin soliciting approval from its creditors. The voting process for creditors is to be completed by Jan. 22. Hawker Beechcraft will seek approval from the court to emerge from bankruptcy at a confirmation hearing scheduled for Jan. 31.

American Airlines passenger service agents, the only major employee group at the carrier not unionized, began voting yesterday on whether to be represented by the Communications Workers of America union, Reuters reported yesterday. About 9,700 airport agents and reservations representatives are eligible to cast ballots in a vote being conducted by the National Mediation Board (NMB), said Chuck Porcari, a CWA spokesman. Voting ends Jan. 15. The U.S. Supreme Court cleared the way for the vote last week when it denied American's request for a stay of an earlier ruling that upheld the election.

American Airlines' bankrupt parent has asked a judge to extend by six weeks, through March 11, the period in which it has the exclusive right to propose a plan to exit bankruptcy, Reuters reported on Friday. The current exclusive window is set to end on Jan. 28. AMR Corp filed for bankruptcy a year ago in hopes of reducing labor costs and returning to profitability. Its smaller competitor, US Airways Group Inc, is making a push to acquire it out of bankruptcy. AMR said earlier this year it would prefer to exit as a standalone company, but is discussing merger options, including with US Airways.

A group of some of bankrupt American Airlines' most significant bondholders said that it will not support a standalone restructuring unless a new board is brought in, a move that may increase hurdles for Chief Executive Tom Horton and his team, Reuters reported today. The 12-member bondholder group, which includes JPMorgan Chase & Co, Pentwater Capital Management and York Capital Management, is the primary group to have expressed an interest in funding an independent exit for the airline's parent company AMR Corp. AMR's current management team, led by Horton who is also chairman of the board, has lost the confidence of the company's unions, which support a takeover bid by smaller competitor US Airways Group. The bondholders, who hold more than $700 million in AMR debt, said in the letter to Keith Wilson, president of American's pilots' union, that its support for an independent exit was "conditioned, among other things, on that plan providing for the naming of a new board of directors."

US Airways pilots have filed a motion in the American Airlines bankruptcy case, seeking to be involved in the process that could lead to a merger that would shape their careers, Forbes.com reported today. The motion filed by the U.S. Airline Pilots Association would "give us access to critical testimony and information presented during the closed bankruptcy hearings," said USAPA President Gary Hummel wrote in a letter. During the summer, Hummel wrote, USAPA negotiated a preliminary memorandum of understanding with US Airways, addressing wages and working conditions that would take effect if a merger occurs. But two months ago US Airways and American signed a non-disclosure agreement, bringing an end to the information flow and to discussions about the memorandum of understanding.