AMR Pilot Board Reaches Accord Needed for US Airways Merger

The board representing AMR Corp. (AAMRQ)’s American Airlines pilots reached a transition agreement that removes another hurdle to a combination with US Airways Group Inc. (LCC) that would form the world’s largest carrier.

By an 11-5 vote, the Allied Pilots Association’s board approved a memorandum of understanding to be considered by the managements of AMR and US Airways and the U.S. Airline Pilots Association, which represents US Airways’ pilots, APA said today in a statement. No terms were disclosed.

Ed Stewart, a US Airways spokesman, told Bloomberg News in an e-mail that the airline cannot comment because of a non- disclosure agreement. American Airlines spokesman Mike Trevino said by e-mail that the company “remains actively engaged in discussions with US Airways, APA and USAPA to develop a framework for the terms of employment for pilots in the event of a merger.”

The accord takes the carriers closer to a possible merger by minimizing the risk of labor objections and easing the two pilot groups toward a joint contract that would align pay and work rules. AMR, which has been in bankruptcy since 2011, has a board meeting set for Jan. 9 to decide whether to go ahead on a combination, people familiar with the matter have said.

Photographer: Andrew Harrer/Bloomberg

A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways would surpass United Continental Holdings Inc. as the world’s largest airline, based on passenger traffic. Close

A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways would... Read More

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Photographer: Andrew Harrer/Bloomberg

A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways would surpass United Continental Holdings Inc. as the world’s largest airline, based on passenger traffic.

The Allied Pilots Association represents about 8,000 active pilots who fly for the Fort Worth, Texas-based American, while the U.S. Airline Pilots Association represents 5,200 who fly for Tempe, Arizona-based US Airways.

A combination of American, the third-biggest U.S. carrier, and No. 5 US Airways would surpass United Continental Holdings Inc. as the world’s largest airline, based on passenger traffic.

AMR filed for Chapter 11 protection in November 2011 ahead of a fourth straight annual loss, listing $24.7 billion in assets and $29.6 billion in debt.

To contact the reporter on this story: Mary Jane Credeur in Atlanta at mcredeur@bloomberg.net.

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net

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