Assignment 2

Assignment 2



Abstract
This assignment will discuss the circumstances that resulted in the merger or acquisition for the US Airways and American Airlines. I will discuss the reason why resulting to the merger and the acquiring of the American Airlines by US Airways. I will also explain the significant positive or negative effect on I will assess the significant positive (or negative) effects of the merger or acquisition and provide at least two (2) examples of those effects now that the merger or acquisition has been completed. I will also examine the organizational structure that has resulted from the merger or acquisition. Analyze the major differences between the resulting company and the original two (2) organizations. Lastly I will determine whether or not the human resources management practices of the company were modified to reflect the outcome of the merger or acquisition.
Mergers and Acquisitions
The circumstance of U.S. Airways and American Airlines merged was because American Airlines filed Chapter 11 Bankruptcy. (Lawton, 2013) When most companies fall on financial hardship they resort to bankruptcy. Bankruptcy seems like the easiest result but however in this case US Airways attempted to save American Airlines by merging and become one of the largest airlines. Also, these operations represent a defensive mechanism of managers as Gorton, Kahl and Rosen (2005) consider. Also, they show that the structure of the sector is very important for the dynamics of mergers and acquisitions. Therefore, the sectors in which several firms have relatively similar dimensions with that of the large firm, with opportunities of profitable
acquisitions, are open to making defensive operations (generating a wave of operations), if the
managers are busy with the private benefits related to control.(Vancea 2012)
The positive effects of American Airlines and US Airways was that it would be one of the largest airlines in the country. The negative effects of the merger is...

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