ATLANTA (Bloomberg) — Delta Air Lines Inc. and Northwest Airlines Corp. shareholders backed a merger of the companies, leaving a federal antitrust review as the final hurdle to creating the world's largest carrier.

Delta shareholders voted in favour of buying Northwest, the company said yesterday at a special meeting in Atlanta. Northwest investors approved the all-stock deal, valued at $2.64 billion as of yesterday, at a meeting in New York earlier yesterday.

The value of the transaction, based on an exchange of each Northwest share for 1.25 Delta shares, has declined 27 percent from $3.63 billion when the merger was announced on April 14.

The combination of Delta, the third-largest US carrier, and No. 6 Northwest would surpass AMR Corp.'s American Airlines as the world's biggest carrier by traffic. Delta, which flies to Bermuda from Boston and Atlanta, said it expects to complete the transaction by year's end.

Delta and Northwest agreed to merge to take advantage of their international networks and growing cargo and maintenance units as higher fuel costs damped demand for US travel.

Delta president Ed Bastian said last week he expects a decision by antitrust regulators at the US Justice Department "very shortly".

Shareholders also approved a stock compensation plan to give 15 percent of the new company's shares to employees. Executives will get 3.5 percent, with an additional 1.6 percent set aside for future management awards; Delta pilots will receive 3.5 percent; Northwest pilots will get 2.4 percent with another four percent going to other employees.

The merged company will keep Delta's name and Atlanta headquarters and be run by Delta chief executive officer Richard Anderson. It will have $35 billion in annual revenue, with 800 aircraft and 75,000 employees.

Delta has already won approval from European antitrust regulators, and the carriers have 26 merger integration teams working on how to mesh their fleets, technology, facilities and other operations.

Delta in July doubled its target for cost savings and new revenue from the merger, to $2 billion. The company also said integration costs will be $600 million over three years, less than its initial estimate of $1 billion.

The combined company would have Delta's trans-Atlantic routes to Europe and its Latin American network, as well as Northwest's Pacific routes including access to the restricted Narita airport in Tokyo.

Adding overseas flying was part of each airline's strategy to return to profit after bankruptcy. Delta exited court protection in April 2007 and Northwest emerged a month later.

Delta, Northwest and other US carriers are cutting 26,000 jobs and parking 460 planes as they slash domestic capacity by at least ten percent.