Merger Timeline

August 15, 2013

Bankruptcy Court Hearing to Approve Plan of Reorganization, United States Bankruptcy Court – Southern District of New York

---

June 19, 2013

The Senate Subcommittee on Aviation held a hearing in Washington on June 19 on the American-US Airways merger. It was the third and, in all likelihood, the last Congressional hearing on the issue. Representatives from the U.S. Department of Transportation, the Government Accountability Office, and the Consumer Travel Alliance testified alongside Doug Parker of US Airways and Gary Kennedy of AA. APFA members, including APFA Legislative Representative Julie Frederick attending the hearing along with Glen Hayataka, IMA; Deb Roland, DCA; and Juan Carlos Ayub, DCA.

Not surprisingly, the issue most Senators are focused on is service to DCA. The government is closely examining the market share the new American would hold at DCA and may force the new American to divest some of its slots before completing the merger. Members of Congress worry that small and medium sized markets would lose direct service to the nation’s capital as a result. Although no final ruling has been made, members of Congress have made clear they do not want any cuts to DCA service.

---

March 27, 2013

Bankruptcy Court Hearing to Approve Merger 10:00 a.m., United States Bankruptcy Court – Southern District of New York

---

March 22, 2013

Senate Judiciary Hearing Recap

In Washington this week, APFA members and leadership attended a hearing before the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights in support of the American Airlines/US Airways merger.

• Read the testimony of the hearing’s witnesses

• Read labor’s joint letter in support of the merger

• Watch the recorded Senate hearing on C-Span

---

US Airways’ Employee Merger Publication: ” Arrivals “

• March 6, 2013

• February 27, 2013

• February 20, 2013

---

February 26, 2013

House Antitrust Subcommittee Hearing

On Tuesday, the House Subcommittee on Regulatory Reform, Commercial, and Antitrust Law convened a hearing to examine the proposed merger of US Airways and American Airlines. Prior to the hearing, Laura Glading sent a letter supporting the merger to each of the Members of the Subcommittee. APFA’s support was reiterated in testimony given by Stephen Johnson of US Airways, as well as Laura Glading’s own testimony which was submitted for the record following the hearing. Finally, APFA members and national officers attended the hearing in uniform to demonstrate their support. They sat alongside our colleagues at APA as well as our future colleagues – the pilots and flight attendants of US Airways. Members of the Subcommittee expressed bipartisan support for the merger and cited the strong backing of the companies’ unions – more proof that unity pays!

• Letter to Chairman Bachus – 2.27.13

• APFA President Laura Glading’s Testimony – 2.26.13

• US Airways/AA Joint Washington Post Ad – 2.26.13

• Hearing Transcript in its Entirety – 2.26.13

• Click here for Hearing Information from the “Committee on the Judiciary“
  

---

February 14, 2013

APFA Merger Announcement and Plan of Reorganization Timeline

APFA wholeheartedly welcomes the news that the management teams of US Airways and American have announced their collective decision to merge and that they are eager to get the merger process started. This transaction will be an integral part of American’s Plan of Reorganization, which it currently is required to file by April 15.

This development speaks to the courage and resolve of the APFA membership. Our union’s efforts to realize this merger began nearly a year ago, when we were quick to identify the benefits of this strategic alternative. Since then, there have been a series of tense negotiations and heroic stare-downs, but the Flight Attendants never blinked. As a result, we will soon find ourselves working at an airline that can compete with any in the industry, under an industry-rate contract, and for a new management team that appreciates our hard work.

Never before in a major airline bankruptcy has organized labor achieved such an outcome. The unions on American Airlines property banded together and forced an alternative on management that is better for the Company, the industry, our passengers, and the employees.

Though the highest hurdle is now behind us, there remain some significant challenges ahead. Fortunately, our team is already preparing for the next steps in this process and we are ready to press on. With this development, there will be lots of exciting changes and we still have much work to do. But the largest challenge is now behind us.

Typically, approval for the merger and an exit from bankruptcy can take anywhere from 4-6 months or possibly more. The following is an explanation of the several layers of approval that must be completed before the merger can be finalized.

 

What’s Left Before American Exits Bankruptcy?

1. American files a Plan of Reorganization (“POR”) and Disclosure Statement that provides for, among other things, treatment of creditors and a merger transaction (Disclosure Statement includes an explanation of the Plan and the treatment of the various creditor classes)
2. Disclosure Statement approved by court depending upon the requirements outlined by the US Bankruptcy Code
3. Pursuant to a POR that provides for a merger of the two airlines, unsecured claims will receive a recovery in the form of equity in the new American
4. Merger requires approval from the Department of Justice (DOJ) and would entail Hart-Scott-Rodino (“HSR”) review
5. Bankruptcy Court approval is required at various stages and stakeholders (for example: UCC, creditors, labor, etc.) have an opportunity to object
6. The POR must receive necessary votes from stakeholders to become “effective”
7. More than 1/2 in number and at least 2/3 in dollar amount of impaired classes of creditors must vote in favor of the POR, among other requirements
8. Once declared effective, a confirmed Plan will discharge the company’s outstanding debts and allow the company to emerge from Bankruptcy
9. Typically, the process takes 3-4 months beginning with the filing of a POR, depending on whether there are stakeholders opposing the POR.* 
   

Week 1: File POR/Disclosure Statement
Week 4: Hearing to approve Disclosure Statement
Weeks 5-7: Distribution of information and solicitation of votes (20 days)
Week 7: Voting deadline for POR, tabulation of votes
Week 9: Hearing to confirm POR
Week 12: POR becomes effective – Debtor emerges

*A merger transaction may entail additional time beyond a typical bankruptcy process given DOJ and Hart-Scott-Rodino requirements