Is American Airlines A Merger Target? | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Most Recent Daily Episodes

Episode Date

Airborne-Monday

Airborne-Tuesday

Airborne-Wednesday Airborne-Thursday

Airborne-Friday

Airborne On YouTube

Airborne-Unlimited-07.07.25

Airborne-NextGen-07.08.25

AirborneUnlimited-07.09.25

Airborne-FlightTraining-07.10.25

AirborneUnlimited-07.11.25

Sat, Feb 17, 2007

Is American Airlines A Merger Target?

Group Including BA Reportedly Interested In Carrier

It's almost unfathomable... and may be illegal, in the eyes of the Department of Transportation. But that hasn't stopped rampant speculation on the news American Airlines may soon be the target of a private buyout bid, by a group including investment firm Goldman Sachs and British Airways.

Business Week cited unnamed sources in its brief report Thursday. Several airline analysts discounted the story, stating any such acquisition of the world's largest airline in terms of passenger-miles flown would almost certainly fail to pass muster with the US government.

"While anything is possible in this high liquidity world of private equity, we're skeptical that this story has merit," Morgan Stanley analyst William Greene told the Associated Press.

According to the Business Week report, the buyout group plans to bid soon on American's parent company AMR, to the tune of between $46 and $52 per share. That translates to a total bid somewhere around $10.5 billion -- and would amount to a significant premium over AMR's closing price Thursday of a nickel over $38, said Tulsa World.

AMR spokesman Tim Smith did little to quell rumors.

"We won't speculate on what our potential role -- if any -- might be," Smith said. "If it becomes appropriate to comment further, we will do so."

A spokesman for British Airways declined to comment to the Associated Press. Goldman Sachs officials didn't return phone messages.

Doubting analysts cited several factors in downplaying the buyout reports -- including American's high debt load, and sheer size of operations. The most significant strike against such a merger, though, is the US government's attitude towards foreign ownership of domestic airlines.

As Aero-News reported, the DOT tentatively denied an application for an operating license by upstart low-cost carrier Virgin America in December. In its refusal, the DOT noted Virgin America would have to revise its ownership, corporate structure and associated agreements to be 75 percent-owned and actually controlled by US citizens before it could receive an operating certificate.

Virgin revised its ownership and resubmitted its application in January. The verdict is still out for that carrier... which is considerably smaller than American.

FMI: www.aa.com, www.britishairways.com, www.goldmansachs.com/

Advertisement

More News

Aero-News: Quote of the Day (07.11.25)

“Honored to accept this mission. Time to take over space. Let’s launch.” Source: SecTrans Sean Duffy commenting after President Donald Trump appointed U.S. Secret>[...]

ANN's Daily Aero-Term (07.11.25): Permanent Echo

Permanent Echo Radar signals reflected from fixed objects on the earth's surface; e.g., buildings, towers, terrain. Permanent echoes are distinguished from “ground clutter&rd>[...]

ANN's Daily Aero-Linx (07.11.25)

Aero Linx: European Hang Gliding and Paragliding Union (EHPU) The general aim of the EHPU is to promote and protect hang gliding and paragliding in Europe. In order to achieve this>[...]

NTSB Final Report: Schweizer SGS 2-33A

Glider Encountered A Loss Of Lift And There Was Not Sufficient Altitude To Reach The Airport Analysis: The flight instructor reported that while turning final, the glider encounter>[...]

NTSB Prelim: Aeronca 7AC

Airplane Climbed To 100 Ft Above Ground Level, At Which Time The Airplane Experienced A Total Loss Of Engine Power On May 24, 2025, at 1300 eastern daylight time, an Aeronca 7AC, N>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2025 Web Development & Design by Pauli Systems, LC