Federal antitrust officials reviewing America West Airlines' proposed acquisition of US Airways concluded yesterday that the move wouldn't reduce competition and could produce...
PHOENIX — Federal antitrust officials reviewing America West Airlines’ proposed acquisition of US Airways concluded yesterday that the move wouldn’t reduce competition and could produce efficiencies that benefit consumers.
The Justice Department’s decision to close its review allows the deal to move forward.
It still needs approval from America West shareholders, a court overseeing US Airways’ bankruptcy case, the U.S. Department of Transportation, the Securities and Exchange Commission and the federal board that handled government bailout loans made to both airlines after the Sept. 11 terrorist attacks. The Air Transportation Stabilization Board lent the companies more than $1 billion total.
Even though America West is the acquirer, the US Airways name will survive and be used when the nation’s seventh- and eighth-largest carriers combine to create the No. 6 airline. The deal will be funded by $1.5 billion in new capital from a variety of investors, including aircraft maker Airbus.
Arlington, Va.-based US Airways Group Inc. has a strong presence on the East Coast and in the Caribbean. America West, based in Tempe, Ariz., operates across the West from hubs in Phoenix and Las Vegas.
The deal will enable the combined airline to offer consumers better service to more locations, R. Hewitt Pate, assistant attorney general for the Justice Department’s antitrust division, said in a statement.
The carriers said yesterday they remain on track to get all regulatory approvals this summer and plan to close the deal by the early fall.
Outside investors have until June 30 to submit a competing bid for US Airways in its bankruptcy case. If there isn’t one, the airlines can seek final approval of the deal from the bankruptcy judge as part of US Airways’ emergence from Chapter 11 protection.
Shares of America West Holdings Corp. fell 39 cents to close at $5.66 Thursday on the New York Stock Exchange.