Courtesy of Benzinga.
The CEOs of bankrupt AMR Corp. (PINK: AAMRQ) and US Airways (NYSE: LCC) met on Thursday to discuss a potential merger between the two companies. The early morning meeting occurred at a downtown Washington D.C. hotel between AMR CEO Tom Horton and US Airways CEO Doug Parker.
According to the Wall Street Journal, Horton told Parker to expect AMR to “run a methodical process and not rush into any deals as the larger airline charts a path out of Chapter 11 bankruptcy.” Horton said that his company would be exploring a range of potential transactions, including a deal with another airline. These options need to be measured against AMR’s plans to emerge from bankruptcy as an independent company, according to WSJ sources.
Furthermore, the sources said that AMR would be sending nondisclosure agreements to multiple parties in the next several weeks, and that by signing these documents, potential suitors would be able to inspect confidential AMR financial information and vice versa, so that the companies could gain a clearer view of what a potential merger would look like. Parker apparently expressed some skepticism about signing a nondisclosure if the terms did not allow US Airways to exercise a full range of options.
“We are pleased that Tom Horton reached out to meet with us this morning,” US Airways said in a statement Thursday. “No substantial progress was made, but we hope this is the start of a meaningful, fair and transparent process that will give us the ability to demonstrate further why combining American Airlines and US Airways is in the best interests of all of our stakeholders.”
On Wednesday, Parker was enthusiastic about a potential merger between the two companies before a gathering of the National Press Club. The Wall Street Journal reports that US Airways has been aggressively pursuing a deal with AMR for months. Until recently, AMR’s Horton has been saying that his airline would not consider a deal until it has emerged from bankruptcy.
In this morning’s meeting with the US Airways CEO, he apparently back-pedaled from this stance saying that he would pursue any deal that would benefit AMR creditors and stakeholders, no matter the timing. According to the WSJ report, AMR is considering potential transactions with JetBlue (NASDAQ: JBLU), Alaska Air Group (NYSE: ALK), and Republic Airways (NASDAQ: RJET), in addition to US Airways. These companies, however, have expressed little interest in a potential deal at this point.
