American Airlines plans to announce tomorrow its intention to acquire Trans World Airlines (TWA) and a stake in US Airways, the Wall Street Journalreported.
The newspaper said American Airlines is also looking to pay $1.4 billion for a 20 per cent stake in US Airways with United Airlines seeking to acquire the remaining 80 per cent.
If the deals go through, United and American will have amassed half of the US air travel market, leaving the other half scattered between six rivals, the newspaper said.
By selling assets to American Airlines - including 86 aircraft, landing slots and gates at key East Coast airports and setting up US Airways' popular Boston-New York-Washington shuttle as a joint venture - United hopes to satisfy regulators' concerns by creating parity between the two giant carriers.
It also cited other officials as saying the deals could lead to further consolidation in the US airline industry which would cut competition.
AFP