The European Commission (EU) has allowed Delta Airlines Incorporated to buy its rival Northwest Airlines Incorporated, clearing the decks for the creation of the world’s biggest airline. A statement from the Brussels-based European Commission said that, after examining the proposition for merger of the two major airlines, the Commission “concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.”

Delta Air Lines, based and headquartered in Atlanta, Georgia, the United Stats, operates an extensive domestic and international network covering North America, South America, Europe, Asia, Africa, the Middle East and the Caribbean. Delta, which flies to over 340 destinations in about 60 countries (excluding codeshare) across 5 continents, is also the only major US airline that flies to Africa.

Northwest Airlines, the principal subsidiary of Northwest Airlines Corporation, is a major airline headquartered in Eagan, Minnesota, near Minneapolis-St Paul International Airport in the United States. The carrier has 3 major hubs in the United States: Detroit Metropolitan Wayne County Airport, Minneapolis-Saint Paul International Airport, and Memphis International Airport. Northwest Airlines also operates flights from a small hub in Asia at Narita International Airport near Tokyo, Japan, and also operates trans-Atlantic flights in cooperation with partner KLM from Schiphol Airport in Amsterdam, the Netherlands. It maintains focus city operations at Indianapolis International Airport, Honolulu International Airport, and Seattle-Tacoma International Airport.

At present, Delta Air Lines is the third-largest United States-based airline and Northwest Airlines is the number 5 US-based carrier.

The proposal for merger, involving $ 18 billion, had been announced in April 2008.

An official of Delta Air Lines said the combined airline, which will be called Delta, would have an enterprise value of $17.7 billion, which includes the combined market value of the two companies and their net debt.

The new airline, to be led by Richard Anderson, chief executive of Delta Air Lines, will have its headquarters in Atlanta, Georgia, the United States.

It will operate under Delta’s flag, with over $35 billion in annual revenue and with about 75,000 employees.

Both Delta Air Lines and Northwest Airlines had emerged from Chapter 11 bankruptcy proceedings in 2007.

The statement from the European Commission explained: “The EU executive has determined that the activities of the two companies in carrying passengers on trans-Atlantic routes were mainly complementary as they have hubs in different cities in the United States. For trans-Atlantic cargo transport, the deal would have only a limited impact because of the two companies’ limited presence in this market.”

The EU’s decision, the statement added, would not affect its investigation of the SkyTeam alliance of airlines, of which both Delta Air Lines and Northwest Airlines are members. The Commission also noted that it “had previously found that members of SkyTeam alliance could not to be considered as effective competitors on transatlantic routes.”