This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Everyone Declares Victory After US Airways/AMR Merger Approval

Stocks in this article: AAMRQ LCC

CHARLOTTE, N.C. ( TheStreet) -- Now, as expected, nearly everybody can declare victory following the settlement for the merger of US Airways (LCC) and American (AAMRQ).

Arguably, it's legitimate. The Justice Department got more than it started with, the airlines got the merger they needed, the labor unions were rewarded for their lobbying and even some consumer advocates said they weren't displeased.

On a media conference call, a reporter suggested to Assistant Attorney General Bill Baer of the Department of Justice's Antitrust Division that he didn't get much more than the airlines had originally offered. "You're dead wrong," Baer responded. "There was nothing close to this that was ever on the table until recently. There just was not."

On a subsequent conference call, American CEO Tom Horton was asked whether the carriers recently made substantial movement in negotiations. "I don't think the settlement is terribly different from what I would have anticipated early on," Horton responded. "I think it's a reasonable settlement. It allows us to go build the world's best global network."

Asked about the toughest concession in the settlement package, US Airways CEO Doug Parker said "the most painful is the slots at Reagan." Horton agreed, but said the Reagan divestiture "represents about 15% of the combined slots between American and US Airways, so even after divestiture, the new American will have more slots at Reagan than US Airways did prior to the merger."

Baer, meanwhile, noted that the divestiture package in total, which also included 19 slots at New York LaGuardia and gates at five other airports, was "the largest ever in an airline merger."

American's three principal labor unions applauded the merger, as did the US Airways flight attendants union. Gary Hummel, president of the US Airways pilot union, wrote in a letter to pilots that "the overall synergies of the combined airline will be good for the employees and flying public."

As for consumer groups, Business Travel Coalition Chairman Kevin Mitchell said "the remedies that were agreed upon were extensive.

"What's more, in its settlement, Justice recognized the reduced influence of Southwest Airlines (LUV) in keeping fares affordable, and opened up airports and facilities to encourage low-cost airline entry," Mitchell said.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs