American Airlines, US Airways Merger Update: Negotiation Talks Are in 'Final Stages'; TWU Workers to Receive 4.8 Percent Pay Increase, Pending on Merger

About two months after U.S. Airways issued a merger proposal to AMR Corp., a decision could come in the next two weeks.

AMR Corp., which owns American Airlines, might be in "the final stages of negotiating a merger" with U.S. Airways, according to sources to Reuters.

AMR filed for bankruptcy in November 2012 citing high labor costs, and in November 2012, U.S. Airways made their proposal.

Negotiations are still ongoing and meetings are reportedly scheduled to take place today and Jan. 29 but it can still fall apart.

"Negotiations have now largely come down to how the equity of the combined company would be split between shareholders of US Airways and creditors of AMR, and who will run the merged airline, according to the people familiar with the matter," reported Soyoung Kim of Reuters.

According to the sources, the U.S. Airways deal calls for their chief executive, Doug Parker, to handle the merged airline company while AMR creditors will own 70 percent of the equity and U.S. Airways shareholders owning the rest.

If the deal becomes final, the carriers will become the world's largest airline company and better compete against United Continental Holdings Inc. and Delta Air Lines Inc. The potential of American Airlines and U.S. Airways merging could generate $38.69 in revenue, based on 2012 figures, while rival United Continental garnered $37.15 billion.

The news comes as Transport Workers Union (TWU) of America announced it has come to an agreement with American Airlines and U.S. Airways on granting an immediate 4.3 percent pay increase for its workers if the merger does take place.

The TWU represents more than 20,000 American Airlines workers.