NEW YORK, N.Y. - Shares airlines slid Tuesday after the Justice Department and a number of state attorneys general challenged the proposed merger between US Airways and American Airlines' parent company, AMR Corp.
US Airways Group Inc. stock dropped 10 per cent to $16.90. Its shares have quadrupled since late 2011, when AMR filed for bankruptcy and US Airways began to pursue a merger.
The deal would create the world's largest airline by passenger miles, with 6,700 daily flights and annual revenue of roughly $40 billion.
Were the deal to be approved, the four biggest U.S. airlines — American, United, Delta and Southwest — would all be the products of a wave of mergers that began in 2008. Those deals have helped the industry control seats, push fares higher and return to profitability.
Stock of United Continental Holdings Inc., the current No. 1, dropped 5.5 per cent to $31.38 per cent. S
Shares of Delta Air Lines Inc., the second-biggest airline, dropped 7.6 per cent to $19.44.
Southwest Airlines Co. stock lost 2.3 per cent to $13.41.
The selling struck shares of smaller airline too. JetBlue Airways Corp. shares shed 2.5 per cent to $6.20, while Spirit Airlines Inc. stock slid 3.1 per cent to $33.29.