US Airways shareholders approved the carrier's $11 billion merger with American Airlines (AA) Friday during the company's annual meeting in New York.
The approval moves the carrier a step closer to creating the new American Airlines, with US Airways stockholders owning about 28 percent and the remaining shares going to creditors from AA's bankruptcy. In a statement, US Airways said the merger agreement was approved by 99 percent of its shareholders.
"This approval is a major milestone on our path to completing the merger, and we continue to make excellent progress overall thanks to the focused efforts of the dedicated representatives from both companies," said Doug Parker, chairman and CEO of US Airways.
Once finalized, Parker will become the CEO of the newly merged American Airlines. The merged carrier plans on operating 6,700 flights daily to 336 destinations in 56 countries, becoming the largest airline in the nation.
The merger is still subject to regulatory approvals in the United States and internationally.
Although Parker has said that the new AA would provide numerous benefits to consumers, a recent Government Accountability Office (GAO) study reported that the proposed merger would reduce competition for 1,665 flight choices impacting 53 million passengers. Parker has previously said that the merger would reduce competition on the 12 nonstop destinations that the two carriers currently overlap on independently.
Lawmakers have also expressed concern about the merger, with Sen. Amy Klobuchar (D-Minn.) and Sen. Jay Rockefeller (D-W. Va.) saying that the new airline will increase air fares for passengers. Both Klobuchar and Rockefeller are urging the Justice Department to be extremely thorough in its scrutiny of the merger.
US Airways said Friday it expects to finalize the combined airline by the end of the third quarter.
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