Report by Louise Longman
AMERICAN Airlines is to buy Trans World Airlines for about
$500 million, in a move which will make American one of the largest US
carriers.
The proposed takeover is dependent on TWA receiving
bankruptcy approval from the US courts, and will give American a new hub in St
Louis, as well as 190 aircraft, 175 gates and 173 slots.
TWA passengers who are AAdvantage members will be able to
accrue AAdvantage miles on TWA flights.
American’s purchase of TWA is part of a $5 billion
transaction package that includes acquiring key strategic US Airways assets and
a 49% stake in DC Air, a regional US airline which is being set up as part of
United’s merger with US.
American has agreed to pay $1.2 billion to United Airlines
for the US Airways assets, which include 14 gates, 36 slots, 66 owned aircraft
and an additional 20 leased aircraft.