Atlanta ? Delta Air Lines Inc. and Northwest Airlines Corp., squeezed by record high fuel prices and a slowing economy, are combining in a stock-swap deal that would create the world’s biggest carrier.

The boards of both companies gave the deal the go-ahead Monday.

The announcement could spur other airline combinations. The most likely scenario that has been talked about is a potential deal between United and Continental airlines.

Under the terms of the Delta transaction, Northwest shareholders will receive 1.25 Delta shares for each Northwest share they own. The exchange ratio represents a premium to Northwest shareholders of 16.8 percent based on Monday’s closing stock prices.

That currently values Northwest at almost $3.63 billion based on 277 million Northwest shares that the companies said are outstanding.

Delta said the combined airline, which will be called Delta, will have an enterprise value of $17.7 billion, which includes the combined market values of the two companies and combined net debt. It will be based in Atlanta, and Delta CEO Richard Anderson will head the combined company.