View Full Version : Tom Horton said Wednesday creditors should get more stock in a combined airline

11-24-2012, 04:45 PM
The CEO of American Airlines? parent, AMR Corp., says that if his airline merges with US Airways, AMR creditors should get most of the new airline?s stock, according to people familiar with the situation. AMR CEO Tom Horton said Wednesday that AMR creditors should get considerably more stock in a combined airline than US Airways has so far proposed, said one of the people, who spoke on condition of anonymity because the companies have signed a confidentiality agreement. Horton made the comment during a meeting with a committee that represents creditors in AMR?s bankruptcy case. US Airways Group Inc. officials spoke to the committee on Tuesday, two people familiar with the discussions said. They said Horton also said that costs of a combined airline are hard to gauge because of labor uncertainty at US Airways, and that such uncertainty should be reason to give AMR creditors more equity as compensation for the risks related to combining the two airlines? workforces. US Airways is pushing for a merger that would create a company roughly the size of United Airlines, the world?s biggest carrier, and led by US Airways executives. While AMR has lost more than $10 billion since 2001 ? it filed for bankruptcy protection in November 2011 ? US Airways has returned to profitability despite competing against bigger rivals such as United and Delta Air Lines Inc. AMR discounts that performance, saying that US Airways has kept labor costs artificially low by not reaching new contracts with union workers such as flight attendants and pilots. The carrier, created in the 2005 merger of America West Airlines Inc. and US Airways Group Inc., has been unable to get approval for new contracts with pilots and flight attendants, who still work under the contracts negotiated at America West and US Airways. US Airways flight attendants picketed around the country on Wednesday and are conducting a strike authorization vote, after twice turning down tentative agreements earlier in 2012. The pilots are still fighting over the issue of seniority integration, among other issues. The Associated Press, 14 November 2012 10:17 PM

11-24-2012, 06:13 PM
Typical SH...TUFF that is expected