"As we reviewed potential strategic options, it was clear there was no better option for World Air Holdings than the acquisition of North American Airlines," Martinez said. "We've known and teamed with North American for a number of years in our Air Mobility Command business, and the company has built an outstanding reputation."

In addition to being the first to provide 767 service to the AMC, North American is the charter operator for Club Med travel out of New York and operated the Bush-Cheney campaign aircraft in 2000.

"The North American aircraft are popular with a variety of customers, including tour operators, which supports our corporate goal of diversifying our revenue sources," Martinez said. "North American's twin-engine jets are approved for extended over-water operations, which World Air Holdings now can include in its international service options."

World Airways and North American will be managed independently under their respective operating certificates. North American will maintain its operational headquarters at John F. Kennedy International Airport in New York, with World Airways and World Air Holdings continuing to be based in Peachtree City.

The acquisition is expected to generate a variety of synergies at both North American Airlines and the holding company levels, and is expected to be accretive to the company's earnings in 2005. World's fleet consists of 16 wide-body MD-11 and DC-10 passenger and cargo aircraft, and North American operates three Boeing 767-300ER passenger aircraft and five Boeing 757-200ER passenger aircraft. World Airways will add another MD-11F cargo aircraft to its fleet in May.

With this acquisition, World Air Holdings, Inc., formed in January 2005, now owns World Airways, Inc., North American Airlines, Inc., and World Risk Solutions, Ltd. World Air Holdings now encompasses 2,000 employees providing military and commercial customers in all parts of the world with passenger and cargo service. Both World Airways and North American are major carriers of U.S. military personnel for the AMC.