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Tue, Aug 13, 2013

US Airways, AA Merger Grows In Value

Latest Estimates Put $14 Billion Price Tag On The Deal

In court documents filed by AMR Corp, the parent of American Airlines and American Eagle, the value of its proposed merger with US Airways has grown from $11 billion to $14.3 billion, according to the creditors' committee.

The Dallas Morning News reports that the original valuation was based on the price and number of shares of US Airways common stock as of February 13. That stock has risen in value from $14.66 to $19.38 as of August 1.

Those who are most excited about the news are likely the current owners of AMR stock. Those shareholders have been promised 3.5 percent of the stock in the new American Airlines Group after the merger. Creditors will be paid what they are owed, but no more, so the rising stock value means little to them.

U.S. Bankruptcy Judge Sean Lane is currently considering AMRs plan to emerge from Chapter 11 reorganization. Lane is scheduled to hold a hearing on the plan Thursday. If he approves the plan, it must be examined by the Justice Department for potential antitrust violations.

FMI: http://www.aa.com/i18n/amrcorp/corporateInformation/facts/amr.jsp

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