A group of AMR Corp. bondholders with about $885 million in debt has told pilots that its support for a stand-alone American Airlines after bankruptcy would be conditioned on the appointment of a new board.
The board representing AMR Corp.’s American Airlines pilots reached a transition agreement that removes another hurdle to a combination with US Airways Group Inc. that would form the world’s largest carrier.
AMR Corp.’s American Airlines, the third-largest U.S. airline, asked a bankruptcy judge to let it void labor contracts with union workers after failing to reach agreements on $1.25 billion in annual cost reductions.
Pilots for AMR Corp.’s American Airlines asked a U.S. bankruptcy judge to suspend his order allowing the carrier to throw out their labor contract and impose cost cuts while their appeal is considered.
American Airlines and its pilots union are working to reach a contract agreement over the next several days, spurred by a manpower shortage that forced the carrier to cut flights and close a crew base.