American Airlines, US Airways Merger Talks Begin

Fort Worth-based American Airlines and US Airways are closer to a potential merger.

The companies said Friday they've signed a non-disclosure agreement allowing them to confidentially exchange information. The Wall Street Journal reports American has also signed an NDA with International Airlines Group, the parent company of British Airways.

US Airways CEO Doug Parker said both sides have agreed to work together to discuss and analyze a potential merger.

American parent AMR Corp. filed for Chapter 11 bankruptcy protection last November. American CEO Tom Horton has said the carrier is weighing several options, including remaining independent or merging with one of several airlines, including US Airways Group Inc.

American told its managers Friday that the carrier is cutting its expenses in bankruptcy court and is also now looking at other strategic options.

"We believe the non disclosure agreement to be a positive step in the right direction. It represents the first step in American's compliance with the merger protocol that it agreed to earlier in the year. The NDA will allow US Airways to develop and submit an alternative plan of reorganization which could potentially lead to a merger of the two airlines," said Tom Hoban, with the Allied Pilots Association.

American said Friday morning that they do not expect to provide any further announcements regarding the NDA until the airlines have entered into a transaction or terminated discussions. American also said that simply signing the NDA and beginning talks with US Airways didn't guarantee a merger will take place.