U.S. actress Anna Kendrick waves as she leaves at a news conference to promote her movie "Up In The Air" in Tokyo March 16, 2010. REUTERS/Issei Kato (JAPAN - Tags: ENTERTAINMENT TRANSPORT)

American Airlines and US Airways Group said they plan to merge in a deal that will form the world's biggest air carrier with a combined equity value of $11 billion.

The merger caps a wave of consolidation that has helped put US airlines on more solid financial footing.

The widely expected deal has been more than a year in the making.

American, a unit of AMR Corp, filed for Chapter 11 bankruptcy in November 2011, and US Airways began its pursuit of a merger in early 2012.

The new carrier - which would carry the American Airlines name - would be 2 percent larger than current No. 1 United Continental Holdings in traffic, as measured by the number of miles flown by paying passengers worldwide.

The new American will be based in Dallas-Fort Worth and will be headed by US Airways Chief Executive Doug Parker, who has long advocated industry consolidation.

US Airways stockholders will receive one share of common stock of the combined airline for each US Airways share, the companies said in a statement.

US Airways shareholders will get 28 percent of the equity of the combined airline.

The remaining 72 percent will be issuable to stakeholders of AMR and its debtor subsidiaries, American's labor unions, and current AMR employees.

The transaction, subject to approvals from regulators and the US Bankruptcy Court, is expected by the two companies to generate more than $1 billion in annual net synergies in 2015.

The companies also said they expect $1.2 billion in one-time transition costs spread over the next three years.

Rothschild is advising American Airlines, and Weil, Gotshal & Manges LLP, Jones Day, Paul Hastings, Debevoise & Plimpton LLP and K&L Gates LLP are serving as legal counsel.

Barclays and Millstein & Co. are advising US Airways, and Latham & Watkins LLP, O'Melveny & Myers, Cadwalader, Wickersham & Taft LLP, and Dechert LLP are serving as legal counsel to US Airways.

Moelis & Co and Mesirow Financial are financial advisers to the Unsecured Creditors Committee. Skadden, Arps, Slate, Meagher & Flom LLP and Togut, Segal & Segal LLP are the creditors' legal counsel. - Reuters