ST. LOUIS Trans World Airlines will announce today its plans to file for Chapter 11 bankruptcy protection and accept a buyout by AMR Corp.s American Airlines.
TWA CEO Bill Compton briefed political leaders in Missouri on the deal via telephone after the airlines board approved it last night. U.S. Rep. William Lacy Clay, a Democrat from St. Louis, said Compton told him the deal would be announced this morning in New York.
TWA spokeswoman Julia Bishop-Cross refused to comment, as did a spokesman for AMR.
While he was not given any financial details, Clay said Compton promised American would keep all of the airlines union employees and that St. Louis would remain a hub. According to a report on The Wall Street Journals Web site, American will pay TWA $500 million and assume about $3 billion of aircraft operating leases.
American reportedly will acquire about 20 percent of US Airways assets. Its a deal that might help UAL Corp.s United Airlines gain regulatory approval of its $4.3 billion purchase of US Airways, according to analysts.
If approved and completed, the deals would give Chicago-based United and American control of more than half of the U.S. air travel market.
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