Tempe, Ariz.-based US Airways has courted AMR, parent of American Airlines Inc., since soon after the larger American flew into bankruptcy in November 2011. Though American management initially expressed a preference to emerge as an independent before considering consolidation, sources say that pressure from creditors and labor groups make a merger a more likely outcome.

While cautioning that nothing has been finalized, sources close to the deal say AMR is focused on a combination that would keep the American Airlines name and Fort Worth, Texas, headquarters, with US Airways CEO Doug Parker leading the new airline and AMR chief Tom Horton serving as nonexecutive chairman.

Sources differed on how close a deal is to being announced, but all agreed the transaction, and not emerging solo, is AMR's primary focus at this moment.

Reports surfaced Thursday, Feb. 7, that AMR creditors would own about 72% of the combination, though sources cautioned the exact ownership structure has not yet been determined. The two sides are still ironing out details about the merger agreement and finalizing post-deal financing toward a goal of announcing a transaction before Feb. 15.

A merger would require regulatory approval. Though most in the industry expect the government to eventually sign off on a deal between American and US Airways, the process could prolong AMR's stay in bankruptcy and might result in the need for some divestitures in markets including Washington, D.C.

The deal would combine the nation's third- and fifth-largest carriers to create an airline with the size and geographic reach to better compete against United Continental Holdings Inc. and Delta Air Lines Inc. US Airways, which was formed a decade ago from the merger of Parker's America West Holdings Inc. and bankrupt US Air, in recent years has been widely praised by analysts for its streamlined operations but is considerably smaller than American, United and Delta.

American, meanwhile, was the last pre-deregulation airline to succumb to bankruptcy, and prior to its 2011 filing was saddled with high costs and uneasy relations with its labor groups. Union leaders early into the bankruptcy worked out tentative deals with US Airways and some demanded Horton be ousted as part of the reorganization, but sources say AMR's board and some creditors want the American executive to stay in a role to help smooth the transition.

AMR has cut annual costs by more than $1 billion in bankruptcy, and eased work rules to allow for more third-party flying. Combining with US Airways would create an airline with hubs or large operations in every region of the U.S., and strong partnerships with foreign airlines in Tokyo and London.