AMR takes next step in spin-off of Eagle as separate publicly-traded company

AMR Corporation reported that its subsidiary, AMR Eagle Holding Corporation, has filed a Form 10 Registration Statement (“Form 10”) with the U.S. Securities and Exchange Commission.  The Form 10 filing marks the next step in a potential spin-off of Eagle and describes the potential spin-off, provides an overview of Eagle’s business, management and its ongoing relationship with American Airlines, and provides historical and pro forma consolidated financial statements of Eagle.  In the spin-off, AMR Corporation would distribute to its stockholders 100 percent of the outstanding shares of Eagle on a pro rata basis, and AMR Corporation would not retain any ownership interest in Eagle.

On a pro forma basis, in 2010, Eagle generated $1.2 billion in revenue with more than $250 million from ground handling services.  Eagle would operate the third largest regional airline in the United States as it provides the vast majority of American’s regional flight operations.  Under a nine-year air services agreement with American, Eagle would initially operate 281 aircraft on behalf of American.  American could withdraw from Eagle and re-bid up to 12 turbo prop aircraft per year beginning in 2012 and a specified number of jet aircraft up to 40 per year beginning in 2014.  The agreement would also include a provision to re-set rates to reflect any change in market levels for regional feed after four years.

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