Air- American Airlines: No ‘plan B’ if US Airways merger fails – National News

Posted: August 23, 2013 in Uncategorized

Aug. 21, 2013

American Airlines has no “Plan B” should its merger with US Airways fall through.

That’s according to American Airlines general counsel Gary Kennedy, who confirmed that detail to The Dallas Morning News. Kennedy was making his first public comments since the U.S. Justice Department’s surprise suit to block the merger.

Both American and US Airways have vowed to fight the Justice suit, but Kennedy says American faces an uncertain future if the carriers’ fight against Justice fails. AA had planned on its merger with US Airways for its business plan to emerge from Chapter 11 bankruptcy.

Kennedy tells the Morning News that American has “no contingency plan” if the merger effort falters.

“We are focusing all of our efforts and energies on winning this lawsuit,” he says to the newspaper. “There’s no Plan B,” he adds.

Kennedy also suggests that negotiations with Justice appear unlikely to produce a resolution, telling the Morning News that “DOJ has shown no interest in settlement discussions,”

For now, American’s long-term outlook remains in limbo while it and US Airways contest the Justice suit.

But beyond the uncertainty, the hold-up in the merger process also comes with a tangible cost as American’s stay under bankruptcy protection will last longer than expected.

The Morning News writes the delay “also extends American’s extraordinarily legal tab for the outside lawyers it is employing for the bankruptcy, merger and now the antitrust battle. Court records show that American Airlines, since it filed for bankruptcy in November 2011, is spending about $500,000 a day in legal expenses and that the airline’s total legal expenses have been about $150 million.”

via American Airlines: No ‘plan B’ if US Airways merger fails – National News.


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