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Deal in place to rescue American/US Air merger

Airline merger cleared for takeoff

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    Airline merger cleared for takeoff

Airline merger cleared for takeoff 01:38

Story highlights

  • Justice Department had sued to block the planned combination of the two big airlines
  • The deal announced on Tuesday requires the carriers to sell certain facilities to boost competition

The Justice Department has reached a settlement with American Airlines and US Airways that requires them to sell facilities at seven airports in order to complete their planned $11 billion merger to create the world's biggest carrier.

The deal announced Tuesday allows low-cost airlines to increase their presence at Boston Logan, Chicago's O'Hare, Dallas Love Field, Los Angeles, Miami, New York LaGuardia, and Washington National airports.

The Justice Department and attorneys general from several states and the District of Columbia sued in August seeking to block the merger on grounds it would lead to higher prices and less service for consumers.

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The agreement requires court approval as part of American's bankruptcy restructuring. The carriers now expect to complete their merger in December.

Virgin CEO: Merger hurts small airlines

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    Virgin CEO: Merger hurts small airlines

Virgin CEO: Merger hurts small airlines 03:00

Antitrust officials claimed the planned merger, which follows a wave of airline industry consolidation in recent years, would "substantially lessen competition" for commercial air travel.

The carriers fought back, saying that integrating their networks to benefit passengers was their motivation for merging and that blocking the deal would only "deny customers access" to a broader network that "gives them more choices."

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