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Public merger of two airlines on hold by Dept. of Justice


Businesses around Baton Rouge face acquisitions or mergers on a daily basis. And it's probably safe to say that most transactions are dictated by rules and regulations by different government entities. Sometimes the decisions made by the government can determine if a merger even takes place. Be it federal, state or city, someone always has a hand in these and some even end in business litigation.


An example of this is the current merger between US Airways and American Airlines. In what was assumed to be an allowable merger, due to other large airline mergers having been allowed, the Department of Justice has put a halt the merger. This would have created the world's single largest airline carrier. A lawsuit is now in place saying that the merger would create higher prices and less service for customers. Higher fees and fewer flights were used as examples. Additionally, the suit contends that competition would decrease. Both American and US Airways disagree and feel that the joining of the airlines would only be a benefit to customers.

This very public merger is supposed to determine what's best for all involved and the Justice Department is certainly trying to keep competition going as well as keep customers from getting hurt. However, not all mergers have to be this bumpy.

A business attorney can help draw up a contract or provide support for proposed mergers. They can help navigate the regulatory process or work through disputes. Someone with experience can assist in working through the daunting business process.

Source: CNN.com, "US government seeks to block American-US Airways merger," Even Perez, Aug. 13, 2013

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Dale M. Maas, Attorney at Law
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