American’s bankruptcy judge approved the anti-trust settlement between American, US Airways, the US Department of Justice and several states.
What’s more, the judge ruled that incorporating the settlement didn’t constitute a material change to American’s plan or reorganization, thus a new plan approval was not required.
The merger will be allowed to proceed, and is expected to close December 9th.
A ‘private’ anti-trust suit remains underway. The group suing the airlines had sought a restraining order to block the merger, but the judge ruled that they had failed to show irreparable harm should the merger proceed and denied their request and ruled that they would have to cover costs.
In my view because US Airways is overpaying, American’s unsecured creditors will be made whole and there will be some equity in the new company for American’s shareholders as well.
The Dallas News Aviation blog reproduces the judge’s order allowing the merger to proceed.
The process sure took long enough — bankruptcy for nearly two years, merger speculation for nearly that long, a merger that had been expected to close back in August before the Department of Justice filed suit.
I don’t know any frequent flyer who actually wanted this. I’m as close to any that will benefit from it, living in a US Airways hub city as an American Airlines 100,000 mile flyer.
My hunch is that we will see some changes coming to the combined frequent flyer program of the new airline — changes that would have happened anyway, that get attributed to the merger. And that while there will be unhappiness amongst the flyers of both airlines, what emerges will be a frequent flyer program that is still better than Delta’s (and an award chart more lucrative than United’s as well), and an airline operation better than United’s. I suppose that’s George Bush’s ‘soft bigotry of low expectations’ and while I’d have much preferred standalone carriers, American going forward is highly likely to remain my domestic airline of choice.
As a reminder, we can expect reciprocal mileage-earning and redemption January 7. There should be some elite status recognition coming after that, as well as a likely ability to move miles back and forth between the two frequent flyer programs.
US Airways will leave the Star Alliance — possibly March 1, but highly likely by the end of March. It will then join oneworld, sometime after it leaves Star and possibly on or about April 1.
The airlines will continue to operate independently. My guess is that they are combined into a single brand before the end of the first quarter of 2015 — perhaps sometime in February 2015 or if I had to guess a date certain it would be March 7, 2015.