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Justice OKs TWA deal
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March 16, 2001: 4:19 p.m. ET
Agency won't oppose AMR Corp.'s $742M bid for bankrupt TWA
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NEW YORK (CNNfn) - The Justice Department said Friday it will not challenge American Airlines' bid for Trans World Airlines.
AMR Corp. will pay $742 million to take TWA out of bankruptcy.
The DOJ said it reached the decision "after a comprehensive investigation that included consideration of TWA's bankrupt condition."
On Monday a federal bankruptcy court judge accepted American's bid, after he ruled that three competing bids, including one submitted by billionaire financier Carl Icahn, were not valid.
The Icahn-financed bid of more than $1.1 billion depended upon achieving $100 million in cost savings from TWA's unions, or, alternatively, using the bankruptcy court's powers to reject the unions' labor agreements if they do not agree to the $100 million cost savings. The cost savings include a presumed 5,000-person reduction in TWA's work force.
"Quite frankly, it's almost a joke," Judge Peter Walsh said on March 8 of a two-page document outlining the Icahn group's proposal. "It's an opener for discussion, and you're not going to have that discussion before this judge."  Icahn was a previous owner of the airline who filed for bankruptcy protection for TWA in 1992. It was the first of three bankruptcy filings for the airline in the last decade, the most recent coming at the same time that TWA accepted a bid from American parent AMR Corp.
Federal approval was the last hurdle for the deal.
After the deal is completed, TWA will run as a separate entity for a time before it is integrated into American.
TWA's contracted workers are expected to be given jobs with American, while management and non-contract workers will be assessed on a case-by-case basis.
Shares of AMR fell 61 cents to $33.93 in late afternoon trading Friday.
-- from staff and wire reports 
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