US Airways, American drawing up proposed settlement: report
By Diane Bartz and Karen Jacobs
WASHINGTON (Reuters) - US Airways LCC.N and American Airlines will offer to give up some takeoff and landing slots at Washington, D.C.'s Ronald Reagan National Airport as part of a attempt to get the U.S. Justice Department to allow their merger to proceed, a Dow Jones report said on Wednesday, citing people familiar with the process.
The companies' stock prices have been buoyant recently as investor sentiment has increased that a deal can be reached to create the world's largest air carrier.
The shares rose further on the Dow Jones report. American Airlines' parent company AMR Corp AAMRQ.PK closed up 4.3 percent at $7.30 and US Airways Group closed up 0.94 percent at $22.58.
US Airways, AMR and the Department of Justice all declined to comment on the Dow Jones report.
In a complaint filed in August aimed at stopping the proposed transaction, the Justice Department focused on Reagan National. The two carriers control a combined 69 percent of takeoff and landing slots at the airport, which is used by many members of Congress to travel to and from their home districts.
In its complaint, the federal government also listed more than 1,000 city pairings where the two airlines dominate the market and where a merger could conceivably drive up prices or cut the number of flights.
Dow Jones reported that one of the two people familiar with the proposed settlement said that the airlines still expected to go to trial, set to begin November 25.
The two sides this week agreed to mediation. Both the airlines and the Justice Department have said that they are open to a settlement agreement. Continued...