US government, two airlines say open to settling merger fight

American Airlines , US Airways and the US Justice Department said they were open to settling a court fight over whether the two companies should be allowed to merge, but there was no sign of an imminent agreement.

The Justice Department filed a lawsuit in mid-August, asking a federal court to block the deal, which would form the world’s biggest air carrier. The government said the merger would lead to higher prices for customers, while the companies said it would make them more competitive and strengthen the market.

In a document filed jointly by the Justice Department and the two companies on Wednesday, the government said it was “open to a settlement that addresses the anticompetitive harms posed by the merger but have not yet received any such proposal from the defendants.”

In its initial complaint, the department focused on Ronald Reagan National Airport, outside Washington, DC, where the two companies own a combined 69 per cent of takeoff and landing slots. It also listed more than 1,000 city pairs where the two airlines dominate the market.

The two airlines said in the joint filing with the district court in Washington, DC, that they had tried to settle the case before the complaint was filed “and continue to believe there ought to be a realistic possibility of settlement.”

Two sources told Reuters earlier this week that there had been little or nothing in the way of settlement discussions before the complaint was filed. A person familiar with the matter said that the companies had offered concessions to the Justice Department but declined to describe them.