American Airlines files for Chapter 11 bankruptcy
American Airlines followed in the footsteps of its rival companies Delta and United when it filed for Chapter 11 bankruptcy this morning.
November 29, 2011 at 06:11 AM
3 minute read
The original version of this story was published on Law.com
American Airlines followed in the footsteps of its rival companies Delta and United when it filed for Chapter 11 bankruptcy this morning. Since American has $4 billion in cash, one can't help but wonder if the company plans to further emulate the other airlines by using the court-protected restructuring time as a chance to merge with another airline.
According to analysts, US Airways would be a prime candidate for a merger with American, though if that were to happen, more than 70 percent of the U.S. market would be controlled by three companies, so regulators may end up opposing any such deal.
American's parent company, AMR, has fallen on hard times of late, with stock down 54 percent during the past three months, more than $10 billion in losses since 2001 and a recent contract dispute with the airline's pilots all leading up to the bankruptcy filing.
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