Potential Buyers, PE Among them, Eye American Airlines Parent

(Reuters) – US Airways Group and private equity firm TPG Capital are among several parties interested in potential bids for AMR Corp, the bankrupt parent of American Airlines, people familiar with the matter told Reuters.

These parties have been following AMR’s bankruptcy proceedings closely to evaluate a prospect for a merger or tie-up with American Airlines, the sources said.

The sources, however, cautioned that any deal is unlikely to materialize before AMR is close to completing its court restructuring, which could take a year or longer.

The Wall Street Journal said on Thursday that Delta Air Lines and TPG are weighing a separate bid for AMR, and added that Delta hired Blackstone as its financial adviser.

Delta has conducted an antitrust analysis on a possible tie-up with AMR and concluded that with some concessions, such a deal has a good chance of getting approval from regulators, according to the report.

Sources have told Reuters that while some assets such as American Airline’s Latin American routes could be attractive to Delta, any takeover attempt for the full company has a remote chance of winning antitrust approval.

Speculation on a possible tie-up with AMR has been rampant since the No. 3 U.S. airline filed for Chapter 11 protection from creditors in November.

Delta and AMR both characterized the Journal report as “rumors” and “speculation.” Blackstone was not immediately available for comment. TPG declined to comment, while U.S. Airways was not immediately available for comment.

US Airways, formed from a 2005 merger with America West Airlines, has consistently declined to comment on its prospects for an AMR merger.

The U.S. airline industry, battered for years by overcapacity and volatile fuel costs, has found renewed stability recently because of capacity cuts and mergers.

Proponents of airline consolidation say mergers are an effective remedy for overcapacity. The most recent merger of major U.S. airlines was in 2010 when United Airlines bought Continental Airlines to form United Continental Holdings.

In December, AMR Chief Executive Tom Horton warned employees in a letter that “opportunists” could attempt a merger with the airline as it restructures.

“We will have some input in the process from several interested parties, and we need to get used to that,” Horton said in the letter.

(Reporting by Greg Roumeliotis, additional reporting by Soyoung Kim, Kyle Peterson and Karen Jacobs; editing by Mark Porter)