American Airlines and US Airways have agreed to merge in an $11 billion deal that would create the world's biggest airline - the seventh merger sine 2005 in an industry that faces rising gas prices and stiffer competition.
The new airline will take the American Airlines name, helping to buoy a company that has been in bankruptcy for more than a year, struggling to compete in recent years as its rivals have grown.
Although American dropped its Chicago-New Delhi direct flight last year due to losses, and typically such mergers often cut capacity and eliminate routes, the union could result in revisiting the flight given the constant uptick in US-India traffic.
The combine entity to create the world's largest airline whose fleet will be close to 1,000 planes and carry some 166 million passengers annually. The new combine will fly to 336 destinations in 56 countries .
US Airways CEO Doug Parker will run it, with AMR CEO Tom Horton serving as chairman until its first shareholder meeting, likely in mid-2014.
The boards of both companies approved the deal Wednesday. The companies announced it early Thursday and expect it to close in the third quarter of this year.
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