BA, Goldman not planning AMR bid: sources

An American Airlines jet pulls into the gate area at Dallas/Fort Worth International Airport in this photo taken September 20, 2001. UK airline British Airways and U.S. investment bank Goldman Sachs have no current plans to bid for AMR Corp., parent of American Airlines, sources familiar with the matter said on Friday.

NEW YORK (Reuters) - British Airways BAY.L and U.S. investment bank Goldman Sachs (GS.N) have no current plans to bid for American Airlines parent AMR Corp. AMR.N, sources familiar with the matter said on Friday.

Shares in American Airlines were up 2 percent, well below pre-market gains of as much as 11 percent after a report by BusinessWeek magazine late on Thursday.

In BusinessWeek's "Inside Wall Street" column, Gene Marcial wrote that AMR may be a buyout target of a group including Goldman and British Airways.

The proposed bid was said to be between $9.8 billion and $11.1 billion, or $46 and $52 a share, BusinessWeek reported, citing people familiar with the matter. It is not certain that a bid for the company will materialize, BusinessWeek said, citing its sources.

British Airways, Goldman, and AMR declined to comment.

Takeovers have been a popular topic in the fragmented and highly competitive U.S. airline industry, which posted profits last year for the first time since 2000 amid soaring demand and leaner costs.

But analysts viewed the scenario reported by BusinessWeek as unlikely, because it would face close anti-trust scrutiny and restrictions on foreign ownership.

"We tend to doubt if anything will happen with this proposal, at least at this time," said Ray Neidl, an analyst with Calyon Securities.

Foreign ownership in U.S. airlines is capped at 25 percent under U.S. law. This restriction would limit British Airways' influence and would complicate any benefits that could be gained from the increased scale.

American Airlines, which has a fleet of 672 aircraft including 300 aging MD-80s, is the world's largest carrier. It reported a net profit of $231 million, or 98 cents a share in 2006, after a net loss of $857 million, or $5.18 a share the previous year. It had net debt of $16.3 billion at the end of 2006.

AMR shares were up 85 cents at $38.90 in morning trade on the New York Stock Exchange.

(Additional reporting by Chris Reiter)