AMR Will Buy Wings West for $41.7 Million

The parent of American Airlines agreed Monday to buy Wings West, its San Luis Obispo-headquartered commuter airline partner, in a move that expands American’s presence in California.

AMR Corp. is paying $41.7 million--$10.50 a share--for Wings West, which operates as American Eagle under a marketing agreement with American. The commuter line, in its American Eagle role, feeds passengers to American Airlines’ flights out of Los Angeles and San Francisco.

AMR said it bought the profitable airline because Wings West’s four majority shareholders wanted to sell their stock. “We didn’t want to let an adversary come in and take control of the commuter,” James Brown, an American Airlines spokesman, said.

Carl Albert, Wings West chairman and one of the majority shareholders, said in a statement that the sale was “good news” for shareholders, employees and passengers. With AMR’s financial resources, he added, “Wings West will continue to grow and provide high quality American Eagle service in the western United States.”

The acquisition comes almost a year after American acquired AirCal, the Newport Beach-based regional airline, for $225 million.

Wings West operates in Oregon, Nevada and Arizona, as well as in California. Besides carrying people from smaller communities to the metropolises, it shuttles passengers between cities such as Bakersfield and Modesto. It has 36 propeller-driven aircraft in its fleet.

Provided Many Services

Wings West got its start in 1981, flying passengers between Santa Monica and Mammoth Mountain ski resort. The airline has grown rapidly since its marketing pact with American Airlines went into effect 22 months ago.

Under the agreement, American Airlines provided a number of services, including reservations handling, for a fee, while Wings West gained the advantage of American’s prestige and connections.

John Fredricksen, executive vice president of the Regional Airlines Assn., said the Wings West acquisition--along with American’s earlier purchases of two weaker commuter airlines--could have a broad impact on the airline industry. With the exception of the Texas Air holding company, most major airline firms have not bought their commuter partners. “American is in many ways the industry leader. Other airlines could follow.”

American still has marketing agreements with four commuter airlines in various parts of the country.