Under the proposed deal, American would pay $742 million for most of TWA's assets, including up to 190 planes and the St. Louis hub. It also would pay $82 million for a 49% stake in DC Air, a minority-owned start-up of UAL Corp.'s United Airlines and US Airways Group Inc. that would serve 44 markets out of Washington's Reagan National Airport. With TWA, American will become the largest carrier in the world, though arch rival United Airlines stands to regain that title if it wins approval for its proposed acquisition of most of US Air. With TWA's business, the new American would control 23% of the airline market, congressional investigators have estimated. The chief executive of TWA, William Compton, told a federal bankruptcy court that he would be forced to liquidate his carrier if its deal with AMR wasn't approved. The court approved the deal earlier this week. American's bid includes the assumption of $3.5 billion in aircraft leases. It was announced Jan. 10 - the same day that TWA filedfor bankruptcy for the third time in less than a decade. The deal will retire one of the most storied names in aviation history. TWA, which traces its roots to the 1925 founding of Western Air Express, once catered to popes and movie stars and was owned at one time by Howard Hughes. It held the world's attention during a 1985 hijacking in Beirut and the 1996 crash of a flight from New York to Paris. But the airline hasn't turned a profit since 1988 and has filed for bankruptcy twice before. It lost $115.1 million in the first nine months of 2000 and $353 million in 1999.

The Wall Street Journal