How Budget Cuts are Helping the AMR Corporation (AAMRQ) – US Airways Group Inc (LCC) Merger

This pressure may also force the DOJ to seriously consider a settlement. While the airlines have cautiously floated compromise options — including selling off some slots at Washington’s congested Reagan National Airport — Assistant Attorney General Bill Baer has been pushing for a “full-stop” injunction against the merger . If he feels that he does not have enough time to prepare a strong case, he may opt for the “bird in the hand” by allowing AMR Corporation (OTCMKTS:AAMRQ) and US Airways Group Inc (NYSE:LCC) to merge if they agree to a few concessions.

Foolish bottom line

Judge Colleen Kollar-Kotelly’s recent decision to set the AMR Corporation (OTCMKTS:AAMRQ)-US Airways Group Inc (NYSE:LCC) antitrust trial for Nov. 25 was a significant win for the two companies. A speedy trial gives the airlines a better shot at holding their deal together until the verdict. Moreover, it allows the two companies to take advantage of severe budget cuts that have left the DOJ understaffed.

Meanwhile, antitrust lawyers for the government are now faced with an unpalatable choice between caving in by agreeing to a settlement, or rushing to court with a half-baked case. The first point in the battle between the DOJ and AMR Corporation (OTCMKTS:AAMRQ)/US Airways Group Inc (NYSE:LCC) thus goes to the airlines.

The article How Budget Cuts are Helping the AMR-US Airways Merger originally appeared on Fool.com is written by Adam Levine-Weinberg.

Fool contributor Adam Levine-Weinberg has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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