American, US Air Establish Office of Integration, Hire McKinsey

By Paul Riegler on 22 March 2013
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American Airlines' new and old livery

American Airlines’ new and old livery

American Airlines and US Airways, which announced their merger transition team on February 25, said that the two airlines have created an Integration Management Office as the “primary nerve center” for the work required to integrate the two airlines.  The two airlines, which first announced plans to merge on February 14, also announced that they had hired McKinsey & Co. as advisors on the integration.

Last month, American CEO Tom Horton and US Airways CEO Doug Parker named two executives to lead the integration of the two airlines, namely Bev Goulet, American’s chief restructuring officer, and Scott Kirby, US Airways’ president.

Heading up the Integration Management Office will be US Airways’ chief operating officer, Robert Isom, and American’s Goulet. Under them will be US Airways’ chief financial officer, Derek Kerr, and American Airlines’ senior vice president of people, Denise Lynn.

According to an internal memorandum sent out yesterday, the Integration Management Office will be charged with “capturing the value of the merger” (i.e. cost savings and increases in revenue), “developing the master plan and timeline” for integration, and working with human resource management departments at both airlines “to implement the design of the new organization.”

Four other executives were also named to the merger team: Jim Butler, American’s managing director of commercial planning and performance; Kerry Hester, US Airways’ senior vice president of customer experience; Candice Irvin, American’s managing director of corporate development; and Matt Pfeifer, American’s managing director of operations and strategic planning.

McKinsey advised American during its Chapter 11 bankruptcy case, earning $7.5 million in fees.

The merger requires the approval of U.S. Bankruptcy Judge Sean Lane and must clear a Department of Justice anti-trust review.  The merger is expected to close at the start of Q4 2013.

(Photo: Accura Media Group)

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