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US Air, America West merger talks heat up

Merger talks between bankrupt US Airways Group Inc. and America West Holdings Corp. heated up last week with the carriers hoping to seal a deal before America West’s May 17 annual meeting, the Wall Street Journal reported on Monday.
/ Source: Reuters

Merger talks between bankrupt US Airways Group Inc. and America West Holdings Corp. heated up last week with the carriers hoping to seal a deal before America West’s May 17 annual meeting, the Wall Street Journal reported on Monday.

Several potential investors are studying a proposed business plan under which the combined company would operate under the US Airways brand and focus attention on Midwestern markets while introducing flights to Hawaii, the report said.

The airlines last month confirmed they were talking, but they have not commented further.

No agreement is certain to result from the complex discussions, and possibly no deal will be reached before the meeting, the Journal said, citing people close to the talks.

The people cited in the report said the carriers are closer to signing up new equity investors to help fund the exit of US Airways from bankruptcy-court protection.

Mesa Air Group has also emerged as a possible investor in US Airways, which last week said it took a $91 million charge for terminating employee pension plans and said it will shrink its mainline fleet by another 10 aircraft this summer.