NEW YORK (AP) — American Airlines won bankruptcy court approval Wednesday to combine with US Airways and form the world's biggest airline.
"The merger is an excellent result. I don't think anybody disputes that," Judge Sean H. Lane said before issuing his decision.
The combined airline will have 6,700 daily flights and annual revenue of roughly $40 billion. The new American Airlines will fly slightly more passengers than United, the current No. 1. It will be run by Doug Parker, the CEO of US Airways Group Inc., who began pursuing a merger shortly after American filed for bankruptcy protection in November 2011.
Lane declined, however, to approve a proposed $20 million severance package for outgoing American CEO Tom Horton. The U.S. trustee had objected to the package and, while he didn't question the amount, Lane agreed that the timing of it seemed to violate prohibitions in the bankruptcy law.
"Approving it today is just not appropriate," Lane said. The judge plans to issue a written decision at a later date detailing his reasoning.
Horton has spent nearly his entire career at American, becoming CEO when the company filed for bankruptcy. Horton will cede the CEO position to Parker when the deal closes, and has agreed to leave the company's board within a year of the closing date.