American Airlines is expected to begin evaluating merger proposals, including one with US Airways, following a ruling by a bankruptcy court judge on its labour contracts on 22 June.

US Airways says that it looks forward to participating in the process with American, the Fort Worth, Texas-based carrier's board and the unsecured creditors committee, in a regulatory filing today.

The Tempe, Arizona-based carrier is pursuing a merger with American that it claims would create $1.2 billion in combined cost savings as well as position the combined airline to better compete with Atlanta-based Delta Air Lines and Chicago-based United Airlines.

American backed off its plan to only pursue a standalone restructuring under chapter 11 bankruptcy when it agreed to discuss potential merger options last month.

The carrier says that its leadership, board and unsecured creditors committee will compare all consolidation options against its standalone plan but did not provide a timeline.

US Airways may seek Department of Justice anti-trust approval of a merger in July, ahead of an agreement with American. The move would allow it to avoid potential delays in approval due to the US presidential elections, which will be held on 6 November, according to a recent research report from Morgan Stanley.

The airline declines to comment on the anti-trust approval process.

American is in court-mediated talks with the Allied Pilots Association today and held discussions with the Transport Workers Union earlier this week. Talks with the Association of Professional Flight Attendants fell apart two weeks ago.

"Our goal is to reach consensual deals with all of our unions," says American on the talks.

US Airways has support from all three of American's unions for a merger.

Source: Air Transport Intelligence news