15 Feb 2013

US airlines to merge

8:55 am on 15 February 2013

American Airlines and US Airways have announced plans to merge, in a deal that would form the world's biggest airline.

The move had been widely touted after the two boards were said to have met on Wednesday, the BBC reports.

The merger follows a wave of bankruptcies and consolidations in the United States airline industry.

The lion's share of the new company will be owned by American Airlines' bankruptcy creditors, who will have 72% of the company.

The merger will bring American Airlines closer in value to rival Delta Airlines, with an estimated market valuation of $US11 billion.

The deal is still subject to regulators' approval.