The Star-Telegram sat down with the executives before a news conference to talk about why they decided to merge while American is still in bankruptcy and how Parker landed the chief executive position at the new company.
Here are some of the excerpts from the interview and the news conference.
S-T: Describe the emotions of the past week as this deal became a reality.
Horton: I think this is the culmination of a great restructuring with American Airlines and the new American is going to be a powerhouse. We're really building the world's leading airline here. I couldn't be more excited about that and I know Doug is too.
Parker: My emotions in the past week have been very high and culminating today. We're extremely excited about being with them and moving forward.
The announcement we have today makes me extremely happy.
S-T: Why did you decide to do this merger now? Mr. Horton, you had been initially against a merger. What changed your mind?
Horton: What changed my mind. I'm not really sure my mind changed. When we started on this thing, Andrea, it was all about getting the most value for our owners and best outcome for our customers and our people. When there was talk of a merger right when we were at the outset of our restructuring, I thought that was unwise. I didn't think that would create an outcome that maximized value for our owners. I didn't think it would create a good outcome for our people.
So Doug and I were very candid about this. I said this to Doug and I said this to the creditors as well. The best thing we can do is go build a strong, independent plan for this company. And that can be a very strong independent company and against that we can measure any merger alternatives.
So once we had line of sight on a competitive cost structure, a stronger balance sheet, all of the things we were doing with the product and the new airplanes, we had built a lot of value. ... So at that point Doug and I got together and said, 'Let's sit down and look at this under a nondisclosure agreement where we can share information with one another and really determine if a deal can be made.' And that's what we did. And the result speaks for itself. The American owners own 72 percent of this combined company. That would not have happened in January or February or March or April.
S-T: Did you offer something different initially that was much less than the final equity split, Doug?
Parker: We haven't disclosed offers. We're happy where we ended up. And this is one of the situations where it works out because there was so much value created. It works out great for the US Airways shareholders and great for the American creditors because there is just so much value created in this deal.
S-T: How did you decide who would run the new airline? A flip of a coin?Horton: Yeah. It was the flip of a coin.
Parker: Yeah, and I lost.
Horton: I can’t believe you said that Doug! (laughter)
Parker: It was a joke. (laughter)
Horton: I was asked my views on this by the board, by the creditors, and others and I said I think what is important is that we put together the best team possible here because mergers are all about execution. If you don't execute well, the revenue synergies don't exist, right?
That I was very focused on. It was not about me. But it was about making sure we had the best team. So I said when asked, I said there ought to be a chairman/CEO structure in the early portion of this merger and I said I'm happy to take either job. And so Doug and I talked about it. We kicked it around. There was a lot of discussion among various constituencies. And we concluded this as the best outcome. And I am very happy with it.
S-T: How involved will you be in the carrier as a nonexecutive chairman?
Horton: After closing of the deal, some months in, Doug will be responsible for running the company. He'll be the CEO and I'll be the chairman of the board and I will do chairman of the board duties. Doug and I have known each other for 25 years so neither of us is going to be bashful in sharing our views with one another. But it will be customary chairman and CEO duties.
Q: What does this merger mean for North Texas and Dallas/Fort Worth Airport?
Horton: I think it's only good news for DFW. It just means that the airline that is the home-base airline of DFW is just that much stronger, that much bigger and in time I think it will mean growth for DFW.
Q: Are you concerned about receiving regulatory approval for the merger?
Parker: These are two highly complementary airlines. We fly over 900 routes individually. When you add them up, there are only 12 of them where we have overlap. So this merger is about taking two airlines and putting them together and providing better service to customers.
Q: What kind of layoffs or workforce reductions will be seen, particularly at the headquarters?
Horton: We expect very little redundancy at all in the operations. It's really about putting together the management teams and the efficiencies that can be created there. So there will be some reductions.
Q: When will you transition to the Oneworld alliance?
Parker: Not yet. We still have our Star partners. ... American Airlines is obviously a founding member of Oneworld and the minute we become part of American Airlines, we'll become part of Oneworld.
ST: Will you keep the new livery that American unveiled a few weeks ago?
Horton: It looks like something you would design if you were going to put American and US Airways together. But it is a new look. We are rolling it out very quickly. In fact, we have 60 new airplanes coming this year that will be delivered with the new livery. ... And I think it's a great presentation of the new American going forward.