American formalises Eagle divestiture

Washington DC
Source:
This story is sourced from Pro
See more Pro news »

AMR Corporation, parent company of American Airlines, has announced that it will now move forward with divesting its wholly-owned regional subsidiary American Eagle.

"Strategically for AMR, it would be beneficial, as we could, over time, diversify our regional feed with additional regional airlines to ensure we have access to the most competitive rates and service. A divestiture could provide Eagle an opportunity to vie for business of other mainline carriers and allow the carrier to grow", said AMR CEO and chairman Gerard Arpey.

The company said it is expected that "the divestiture to take the form of a spin-off of Eagle stock to the shareholders of AMR". But AMR also said it "remains open to other options" such as a sale.

AMR has not announced "a specific time frame for the divestiture".

AMR initially announced plans to divest Eagle in November 2007, but in July 2008 the company said it would "place on hold planned divestiture until industry conditions are more stable and favourable". The company said at the same time that it still believed "that a divestiture makes sense in the long term for AMR, American, American Eagle, and their stakeholders".