There has been much turmoil surrounding the American Airlines bankruptcy announcement late last year. As the airline works to make more cutbacks and reorganize debts in Chapter 11, many other airlines are keeping a close eye on the moves AMR is making in case a buyout becomes viable.
Buying Up The Big Boys
As the largest airline in the United States, the bankruptcy announcement sent shock waves through the industry. Concerns over employee and customer relations became forefront as a everyone waited for the news of how AMR would proceed. After several rounds of layoffs, vacant terminal closings and cuts to flight routes, the issue now surrounds whether American will be able to make it out of bankruptcy as an independent company.
US Airways Group Inc. and Delta Airlines Inc. have both hired advisers to study AMR and their debt reorganization moves. Standing to gain major market share if they acquire American in a buyout, either airline would undoubtedly boost profitability as a result. Reports say that bids are being weighed and a potential buyout option may lie in the near future. However, AMR holds firm that they will be able to exit the bankruptcy process successfully and independently in the end.