Continental, United airlines to combine | New York Post Continental, United airlines to combine Modal Trigger A Continental Airlines plane takes off from George Bush Intercontinental Airport with downtown Houston in the background. AP MINNEAPOLIS — Directors at Continental and United airlines have approved a deal that would combine them into the world’s largest airline, a source with knowledge of the situation said today. The stock-swap deal values Continental at some $3.2 billion. Today’s board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement tomorrow. Combining Continental and United would leave the U.S. with three big international airlines — the new United, Delta, and American. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third the size of American’s. The combined airline will be called United, based in United’s hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman. United, a unit of UAL Corp., is the nation’s third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country’s fourth biggest. Any deal would need the approval of antitrust regulators.

The Justice Department approved Delta Air Lines Inc.’s purchase of Northwest in 2008, which turned Delta into the world’s biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce. A union hot line message to United pilots on Sunday said the “union remains engaged in this issue, and if a merger is announced by United and Continental,” union officials “are fully prepared to protect and defend the interests of all United pilots.” Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United’s main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest’s Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they’ve both been losing money.

Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental’s was $3.12 billion. Just two years ago, American Airlines was the nation’s biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travelers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was “not in any way threatened” by the merger talk involving other carriers. “We think we’re in a very good position irrespective of what may happen,” he said at the time.

Share this: UAL, Continental to Merge in $3 Billion Stock Swap UAL, Continental to Merge in $3 Billion Stock Swap AP Sunday, 2 May 2010 | 6:48 PM ET The Associated Press SHARES Directors at Continental and United Airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday. AP The stock-swap deal values Continental at some $3.2 billion. The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday. Combining Continental and United would leave the U.S. with three big international airlines — the new United, Delta, and American. US Airways Group also flies internationally, but its 2009 international traffic was less than one-third the size of American's. The combined airline will be called United, based in United's hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman. United, a unit of UAL Corp., is the nation's third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country's fourth biggest.

Any deal would need the approval of antitrust regulators. The Justice Department approved Delta Air Lines' purchase of Northwest in 2008, which turned Delta into the world's biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce. A union hot line message to United pilots on Sunday said the "union remains engaged in this issue, and if a merger is announced by United and Continental," union officials "are fully prepared to protect and defend the interests of all United pilots." Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United's main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest's Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent.

And they've both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental's was $3.12 billion. Just two years ago, American Airlines was the nation's biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travelers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers. "We think we're in a very good position irrespective of what may happen," he said at the time.

Continental and United Airlines to combine | Newshub Continental and United Airlines to combine 03/05/2010 By Joshua Freed Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday. The stock-swap deal values Continental at some $3.2 billion. Combining Continental and United would leave the US with three big international airlines - the new United, Delta, and American. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third the size of American's. The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday. The combined airline will be called United, based in United's hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman. United, a unit of UAL Corp., is the nation's third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country's fourth biggest. Any deal would need the approval of antitrust regulators.

The Justice Department approved Delta Air Lines Inc.'s purchase of Northwest in 2008, which turned Delta into the world's biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce. A union hot line message to United pilots on Sunday said the "union remains engaged in this issue, and if a merger is announced by United and Continental," union officials "are fully prepared to protect and defend the interests of all United pilots." Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United's main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the US, and the Pan-Am deal made it a major international carrier for the first time. Northwest's Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they've both been losing money.

Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental's was $3.12 billion. Just two years ago, American Airlines was the nation's biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travellers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers. "We think we're in a very good position irrespective of what may happen," he said at the time. AP Continental Airlines specimen stock certificate Product Description Contental Airlines specimen stock certificate circa 2010 Rare printer sample cert with a great vignette of a modern female figure holding a globe with a background of mountains and a jet aircraft over islands.

Circa 2010 from issued examples. Continental Airlines was a major U.S. airline, founded in 1934 and eventually headquartered in Houston, Texas. In May 2010, the airline announced that it would merge with UAL Corporation, the parent company of United Airlines, via a stock swap. Continental's shares were acquired by UAL Corporation. The acquisition was completed in October 2010, at which time the holding company was renamed United Continental Holdings. During the integration period, each airline ran a separate operation under the direction of a combined leadership team, based in Chicago, Illinois. The integration was completed on March 3, 2012. Continental had ownership interests and brand partnerships with several carriers. Continental was a minority owner of ExpressJet Airlines, which operated under the 'Continental Express' trade name but was a separately managed and public company. Chautauqua Airlines also flew under the Continental Express identity, and Cape Air, Colgan Air, CommutAir, and Silver Airways fed Continental's flights under the Continental Connection identity. Continental did not have any ownership interests in these companies. Varney Speed Lines (named after one of its initial owners, Walter T.

Varney, who was also a founder of United Airlines) was formed in 1934, operating airmail and passenger services in the American Southwest. The airline commenced operations with the Lockheed Vega, a single-engine plane that carried four passengers. Following cancellation of all domestic airmail contracts by the Roosevelt administration in 1934, Robert F. Six bought into the airline and became general manager on July 5, 1936. Varney was awarded a 17-cent-rate airmail contract between Pueblo and El Paso; it carried passengers as a sideline. The carrier was renamed Continental Air Lines (later changed to "Airlines") on July 8, 1937. Six relocated the airline's headquarters to Denver Union (later Stapleton) Airport in Denver in October 1937. Six changed the name to "Continental" because he wanted the airline name to reflect his desire to have the airline fly all directions throughout the United States. In 1955 Continental merged with Pioneer Airlines, gaining access to 16 more cities in Texas and New Mexico. Pioneer's Executive Vice President Harding Luther Lawrence arrived at Continental as a result of the merger.

Bob Six commented on more than one occasion that, "the reason we bought Pioneer was to get Harding." Harding Lawrence implemented a number of innovative changes at Continental as well as a flamboyant advertising campaign during his ten years as Mr. Six's protege. During Lawrence's tenure Continental grew by a phenomenal 500 percent." Lawrence left Continental in April 1965 to head Braniff Airways where he implemented dramatic changes that resulted in monumental growth for the Dallas based carrier. During the late 1950s and early 1960s Six was the airline industry's leading lower-fare advocate. He predicted that increased traffic, not higher fares, was the answer to the airline industry's problems. To amazement from the industry he introduced the economy fare on the Chicago-Los Angeles route in 1962. He later pioneered a number of other low or discount fares which made air travel available to many who could not previously have afforded it. In 1981 Texas Air Corporation, an airline holding company controlled by U.S. aviation entrepreneur Frank Lorenzo, acquired Continental after a contentious battle with Continental's management who were determined to resist Lorenzo.

Continental's labor unions also fiercely resisted, fearing what they termed as "Lorenzo's deregulation tactics", which they believed implied that he wanted to make Continental a non-union airline. Lorenzo viewed the company as stuck in the pre-deregulation era and in need of serious changes to stay competitive. Continental was experiencing financial challenges both before and after Lorenzo's takeover, and he demanded immediate wage cuts and layoffs to keep the company afloat. n 1990, Frank Lorenzo was forced to retire after 18 tumultuous years at the helm of Texas International and later Texas Air and Continental Airlines, selling the majority of his Jet Capital Corporation to Scandinavian Airlines System (SAS). On December 3, 1990, Continental filed for its second bankruptcy, due to Lorenzo dedicating himself almost full-time to Eastern Air Lines acquisition and labor relations issues, the 1990 Gulf War had prompted a dramatic increase in the price of jet fuel, and People Express had been highly leveraged at the time of its merger with Continental, having purchased Frontier Airlines just two years before.

In February 2008, UAL Corporation and Continental Airlines began advanced stages of merger talks and were expected to announce their decision in the immediate aftermath of a definitive merger agreement between rival Delta Air Lines and Northwest Airlines. On April 27, 2008, Continental broke off merger negotiations with United and stated it was going to stand alone. Despite ending merger talks, Continental announced that it will join United in the Star Alliance. United and US Airways were in advanced merger talks in late April 2008, following the announcement that Continental had broken off talks with United. In June 2008, CEOs of both United Airlines and Continental Airlines signed an alliance pact that led to their eventual merger. On May 2, 2010, the Boards of Directors at Continental and United Airlines approved a stock-swap deal that would combine them into the world's largest airline in revenue passenger miles. The new airline will take on United Airlines name, Continental's logo and be based in United's hometown of Chicago. Both airlines had been reporting losses in the recession and expected the merger to generate savings of more than $1 billion a year.

At the time of the merger with United, Continental was the fourth-largest airline in the US based on passenger-miles flown and the fifth largest in total passengers carried. Continental operated flights to destinations throughout the U.S., Canada, Latin America, Europe, and the Asia-Pacific regions. United Airlines, Inc. merged into Continental Airlines, Inc., with Continental Airlines, Inc. being the surviving corporate entity and a wholly owned subsidiary of the UAL Corporation, on March 31, 2013. The name of Continental Airlines, Inc. was changed to United Airlines, Inc. Product Reviews AP Source: Continental and United to Combine AP Source: Continental and United to Combine By JOSHUA FREED AP | Posted: Sun 3:38 PM, May 02, 2010 MINNEAPOLIS (AP) - Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday. The stock-swap deal values Continental at some $3.2 billion. The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday.

Combining Continental and United would leave the U.S. with three big international airlines - the new United, Delta, and American. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third the size of American's. The combined airline will be called United, based in United's hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman. United, a unit of UAL Corp., is the nation's third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country's fourth biggest. Any deal would need the approval of antitrust regulators. The Justice Department approved Delta Air Lines Inc.'s purchase of Northwest in 2008, which turned Delta into the world's biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce.

A union hot line message to United pilots on Sunday said the "union remains engaged in this issue, and if a merger is announced by United and Continental," union officials "are fully prepared to protect and defend the interests of all United pilots." Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United's main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest's Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they've both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion.

UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental's was $3.12 billion. Just two years ago, American Airlines was the nation's biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travelers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers. "We think we're in a very good position irrespective of what may happen," he said at the time. "Nothing has changed" - response to Supreme Court Ruling Comments are posted from viewers like you and do not always reflect the views of this station.

AP source: Continental and United to combine | The Bennington Banner | Bennington Breaking News, Sports, Weather, Traffic AP source: Continental and United to combine Posted Sunday, May 2, 2010 8:53 pm Sunday May 2, 2010 MINNEAPOLIS (AP) -- Directors at Continental and United airlines have approved a deal that would combine them into the world’s largest airline, a source with knowledge of the situation said on Sunday. The stock-swap deal values Continental at some $3.2 billion. The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday. Combining Continental and United would leave the U.S. with three big international airlines -- the new United, Delta, and American. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third the size of American’s. The combined airline will be called United, based in United’s hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman.

United, a unit of UAL Corp., is the nation’s third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country’s fourth biggest. Any deal would need the approval of antitrust regulators. The Justice Department approved Delta Air Lines Inc.’s purchase of Northwest in 2008, which turned Delta into the world’s biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce. A union hot line message to United pilots on Sunday said the "union remains engaged in this issue, and if a merger is announced by United and Continental," union officials "are fully prepared to protect and defend the interests of all United pilots." Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United’s main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest’s Pacific routes were one reason Delta pursued that deal two years ago.

Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they’ve both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental’s was $3.12 billion. Just two years ago, American Airlines was the nation’s biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travelers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers.

"We think we’re in a very good position irrespective of what may happen," he said at the time. AP source: Continental and United to combine - The San Diego Union-Tribune AP source: Continental and United to combine A Continental Airlines plane passes an Untied Airlines plane parked at a gate at George Bush Intercontinental Airport Sunday, May 2, 2010, in Houston. Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge / AP A Continental Airlines plane passes an Untied Airlines plane parked at a gate at George Bush Intercontinental Airport Sunday, May 2, 2010, in Houston. Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday, May 2, 2010. (AP Photo/David J. Phillip) A Continental Airlines plane passes an Untied Airlines plane parked at a gate at George Bush Intercontinental Airport Sunday, May 2, 2010, in Houston.

Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday, May 2, 2010. (AP Photo/David J. Phillip) (/ AP) JOSHUA FREED, AP Airlines Writer Directors at Continental and United airlines have approved a deal that would combine them into the world's largest airline, a source with knowledge of the situation said on Sunday. The stock-swap deal values Continental at some $3.2 billion. Combining Continental and United would leave the U.S. with three big international airlines - the new United, Delta , and American. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third the size of American's. The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday. The combined airline will be called United, based in United's hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman. United, a unit of UAL Corp., is the nation's third-largest carrier by traffic.

Continental Airlines Inc., in Houston, is the country's fourth biggest. Any deal would need the approval of antitrust regulators. The Justice Department approved Delta Air Lines Inc.'s purchase of Northwest in 2008, which turned Delta into the world's biggest carrier. Another key issue in putting the two airlines together will be integrating the pilot workforce. A union hot line message to United pilots on Sunday said the "union remains engaged in this issue, and if a merger is announced by United and Continental," union officials "are fully prepared to protect and defend the interests of all United pilots." Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s. One of United's main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest's Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession.

United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they've both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental's was $3.12 billion. Just two years ago, American Airlines was the nation's biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travelers gravitate toward airlines with the most routes. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers. "We think we're in a very good position irrespective of what may happen," he said at the time.

Continental, United to Form World's Largest Airline | Fox News Continental, United to Form World's Largest Airline Published May 03, 2010 Facebook 0 Twitter 0 livefyre Email Print United and Continental Airlines said on Monday they're forming the world's largest airline in a deal worth about $3 billion. The new airline would jump past Delta Air Lines in size and have flights reaching from Shanghai to South America. The United name will live on, although the planes will have the Continental colors and logo. The airline will be run by current Continental CEO Jeffery Smisek. United CEO Glenn Tilton, a longtime advocate of consolidation in the airline industry, will be chairman for up to two years, with Smisek taking over as chairman after that. The deal will first need approval from shareholders and antitrust regulators. It's expected to close in the fourth quarter. The new parent company will be United Continental Holdings Inc. It will be based in United's hometown of Chicago and its biggest hub will be Houston. The companies say the combined airline will have revenue of about $29 billion, and $7.4 billion in unrestricted cash.

The companies said combining would save them $1 billion to $1.2 billion a year by 2013. That includes between $800 million and $900 million of new annual revenue, partly from increased international service. Owners of United parent UAL Corp. will hold 55 percent of the combined company, with Continental Airlines Inc. shareholders owning the rest. Continental shareholders will get 1.05 UAL shares in exchange for each one of theirs. The combination will test the notion that the money-losing industry can work better on a large scale. Corporate travelers love a wide choice of departure times and a worldwide network. Just 18 months ago the Justice Department allowed Delta Air Lines Inc. to buy Northwest Airlines to form what is currently the world's largest airline. But many in the industry have wondered whether the Justice Department under the Obama administration will be as inclined to approve a mega-airline as it was under George W. Bush . Continental and United overlap on 13 nonstop routes, J.P. Morgan analyst Jamie Baker wrote in a note on Friday, compared with 12 overlaps in the Delta-Northwest deal.

Of the overlapping United-Continental routes, 11 would have just one or two carriers. Baker gave the deal a 75 percent chance of winning regulatory approval. Regulators like to see as much competition as possible on each route because it helps keep fares down. Combining Continental and United would leave the U.S. with three big international airlines -- the new United, Delta, and American Airlines. US Airways Group Inc. also flies internationally, but its 2009 international traffic was less than one-third that of American's. United is the nation's third-largest carrier by traffic. Continental Airlines Inc., in Houston, is the country's fourth biggest. Another key issue will be integrating the pilot work force. One of the people who spoke about the deal said pilots have been briefed, but have not begun negotiations on a joint contract. Aviators at both carriers are represented by the Air Line Pilots Association. Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and '30s. One of United's key assets has been its Pacific routes, which it bought from Pan-Am in 1985.

It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest's Pacific routes were one reason Delta pursued that deal two years ago. Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air. Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent. And they've both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion. The market capitalization for UAL Corp. on Friday was $3.62 billion, while Continental's was $3.12 billion. Darryl Jenkins, an airline industry consultant, said the United-Continental combination would be the dominant carrier in several of the largest U.S. markets, including New York, Los Angeles, San Francisco and Houston. It would split Chicago with American and cede Atlanta to Delta.

Jenkins said the new United would surpass Delta in attracting prized corporate travelers, who value convenient schedules to places they need to go. "Now we've got a company that can really clearly compete against Delta," Jenkins said. "Mergers are all about revenue, and this is a tremendous boost for revenue." Just two years ago, American Airlines was the nation's biggest carrier. First Delta surpassed it, and now United might. On April 8, when there was talk that United and US Airways were discussing a deal, American CEO Gerard Arpey said the company was "not in any way threatened" by the merger talk involving other carriers. Smisek, 55, took over as chairman and CEO at Continental at the beginning of 2010 after being its president and chief operating officer. He's been at Continental for 15 years. Smisek plans to keep offices in both Houston and Chicago. Airline analyst Vaughn Cordle said Smisek is a good choice to lead the combined carrier. "He's on top of the world's largest airline, and has a chance to return to profitability," Cordle said.

"That's not a bad thing to do." Advertisement United-Continental looking to business travelers - Boston.com Business United-Continental looking to business travelers The new "livery" for United Airlines combines the United name with the Continental logo, is shown during a news conference in New York, Monday, May 3, 2010. United Airlines is purchasing Continental Airlines. (AP Photo/Mark Lennihan) By Joshua Freed and David Koenig AP Airline Writers / May 3, 2010 E-mail this article Add a personal message:(80 character limit) Your E-mail: | Text size – + United and Continental Airlines are counting on more business travelers -- not higher fares for vacationers -- to make their $3 billion merger pay. United CEO Glenn Tilton and Continental CEO Jeffery Smisek announced Monday that the nation's third- and fourth-largest airlines will consolidate into the world's biggest in hopes of drawing more business travelers who will pay top dollar for last-minute tickets. It's a stock swap deal in which United acquires Continental, and the new airline is to be called United. The two airlines have been losing tons of money, first from high fuel prices, then the recession.

Now they say their combined network of flights across the U.S. and around the world will attract enough corporate travelers to boost revenue by up to $900 million a year. "The only people happier than Jeff and I today is our corporate sales team," Tilton said. Henry Harteveldt, a travel-industry analyst for Forrester Research , said U.S. leisure fares probably won't change much because Continental and United routes overlap heavily with low-fare carriers such as Southwest. They compete with discount carriers on 92 percent of the 50 biggest routes they serve, Harteveldt said. "The leisure market is always hotly contested," so it's less likely to tolerate fare increases, he said. "Business travelers are less price-sensitive. They have to get on that plane, so they'll pay more for those flights." Antitrust regulators will scrutinize the deal for its effect on fares, but Smisek and Tilton said even the larger United won't have be able to boost prices, because other carriers might undercut them. "There is no carrier in the world that can set air fares," Smisek said. "We couldn't set air fares before this.

We can't set air fares after this." The deal would create a giant airline with major hubs in key domestic markets including New York, Los Angeles, Chicago, Houston and San Francisco and an international network that includes United's extensive routes in the Pacific and Continental's routes to Europe and Latin America. The companies said 57 percent of their capacity would be domestic, with 20 percent across the Atlantic, 15 percent across the Pacific and 8 percent to Latin America. Smisek said the carrier would not eliminate service to any cities, and said Cleveland would continue to be one of the hubs when deal closes, even though it is near United's hub in Chicago. "But it would be premature to talk about Cleveland or any hub for that matter in terms of how things will shake out over the next few years," he said. Officials for the two airlines said they will eliminate some headquarters jobs in Houston and Chicago, but they gave no numbers. The deal will leave three big U.S. airlines with major international routes -- the new United, Delta and American Airlines, with US Airways a distant fourth. United is the nation's third-largest carrier by traffic, while Continental Airlines Inc., in Houston, is No. 4.

The carriers said they would file their applications quickly with regulators including the Justice Department and the European Commission. Justice Department spokeswoman Gina Talamona said its antitrust division "is looking at the proposed transaction between these two airlines." The department routinely examines airline deals, which may affect services and prices for consumers. Smisek said United and Continental would seek shareholder votes in September, with the hope of closing the deal by the end of the year. The companies insisted the deal is a merger of equals. Smisek will run the combined operation as CEO, and the companies plan to pull executives from each company in "roughly equal numbers." But United shareholders will hold a majority stake, and the airline will be based in United's headquarters in Chicago. United's Tilton will be non-executive chairman for up to two years before Smisek adds the chairman title. The new parent company will be called United Continental Holdings Inc., and have about $29 billion in annual revenue, based on 2009 results, and $7.4 billion in unrestricted cash.

The airlines said combining would save them $1 billion to $1.2 billion a year by 2013, including between $800 million and $900 million in new yearly revenue. They also said they expect costs of about $1.2 billion for expenses such as severance for laid-off workers and expenses from new labor deals. The deal came together in just three weeks after reports surfaced that United was in discussions with US Airways. "I recognized that United is the best possible partner for Continental," Smisek said on a conference call. Referring to Tilton, he said, "I didn't want him to marry the ugly girl; I wanted him to marry the pretty one, and I'm much prettier." Two years ago, when both airlines were low on cash and facing record fuel costs, Continental walked away from a deal with United at the last moment. Smisek said in an interview that times have changed since then. "Both carriers are performing better than they have been for the past couple of years," he said. "The economy is on an upswing. Fuel prices, although high, are manageable." Labor issues have often been messy in airline consolidation.

Smisek and Tilton said they had briefed their unions on the deal. Both companies said their boards had approved the transaction unanimously, which would include a labor representative on the UAL board. Pilots at both airlines are represented by the Air Line Pilots Association. Wendy Morse, a United captain and chairwoman of the union's Master Executive Council at United, said negotiations over a joint contract have not yet begun. The machinists' union, which represents 16,000 workers at United and more than 10,000 at Continental, said it was concerned about the impact on pensions, benefits and job security. The Association of Flight Attendants unit at United said it wants a contract before considering whether to support the deal. The executives said they will work with the unions to reach new agreements, but said they don't need union approval for the transaction to close. Shares of both companies rose, with United parent UAL Corp. up 51 cents, or 2.4 percent, to close at $22.11, and Continental up 51 cents, or 2.3 percent, to close at $22.86.

------ AP Business Writer Samantha Bomkamp in New York and Associated Press Writer Pete Yost in Washington contributed to this report. © Copyright 2010 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. Continental and United to combine: report | Airlines merger reddit More UAL Corp, parent of United Airlines, will buy Continental Airlines for $US3.2 billion ($3.5 billion), forming the world's largest carrier in a merger that further shrinks the embattled US airline industry and could drive up air fares, sources said on Sunday. The boards of directors of both companies unanimously approved the deal, which was expected to be announced by the carriers later today, sources familiar with the discussions said. UAL and Continental declined to comment and neither airline has confirmed the votes. If given regulatory approval, the carrier would be called United Airlines and would be based in Chicago, with over $US29 billion in annual revenue, a source said. The deal would generate up to $US1.2 billion in revenue and cost benefits for the combined company. "The combined firm would have more staying power than each of them individually," Robert Mann, airline consultant at RW Mann & Co, said.

"Part of it is the consolidation provides pricing power and the opportunity for pricing power for the entire industry." "The margins on the combined business would be better," Mann said. "The share of revenue that's consumed by revenue will be lower. Margins will be better." The airline industry is recovering from an economic downturn that drained travel demand and forced carriers to downsize. Experts have said consolidation would lend much-needed stability to the industry, which has been dogged by low-fare competition, terror concerns, volatile fuel prices and overcapacity. All-stock deal UAL and Continental have agreed to an exchange ratio of 1.05 UAL shares for each Continental share in all-stock deal, the sources said. That value would be determined by the market, and could change by the time the deal closed. Based on United's stock price of $US21.83 on Friday afternoon, and Continental's 139.6 million outstanding shares as of April 21, United would pay $US3.2 billion for Continental. Based on current shares outstanding, a combined company would have 314.5 million shares, and UAL shareholders would own roughly 53 per cent of the new company.

Under the terms for the all-stock merger, UAL chief executive Glenn Tilton would become non-executive chairman of the combined carrier while Continental CEO Jeff Smisek would become chief executive. The carriers are planning a 16-member board with six directors from each airline, plus Tilton and Smisek, and two seats from labor unions. The airlines hope for US regulatory approval of proposed merger by year's end. The new company on paper now would have a combined work force of nearly 90,000 employees and a combined fleet of 693 planes. United Airlines took in more than $US16 billion in operating revenue for 2009. The carrier has hubs in Los Angeles, San Francisco, Denver, Chicago and Washington. The carrier boasts a strong presence on Asia-Pacific routes, Europe and Latin America. The carrier has 46,000 employees and a mainline fleet of 360 planes made by Airbus and Boeing. Continental, which saw $US12.6 billion in annual revenue for 2009, has about 41,000 employees and hubs in Newark, New Jersey, Houston and Cleveland.

Continental has a mainline fleet of 333 jets. The unions representing pilots at UAL and Continental did not have immediate comment. Although John Prater, the president of the Air Line Pilots Association, which represents UAL and Continental pilots, told the Reuters in February that a merger of those two carriers made more sense than other possible combinations because they have less route overlap. UAL and Continental are both members of the global Star Alliance of airlines. UAL shares trade on Nasdaq. Continental shares trade on the New York Stock Exchange. Long time coming The leaders of both airlines had engaged in merger talks before, the most recent being in 2008, when Continental walked away at the last minute out of concern for UAL's then-fragile financial position. Continental and UAL later agreed to link up in a strategic global alliance. The most recent round of talks were completed in about three weeks, a source familiar with discussions said. Some industry experts believe that one airline merger could spur others and that several different combinations of major airlines are possible. The last major airline merger was in 2008 between Delta Air Lines and Northwest Airlines to form what is currently the world's largest airline.

UAL and US Airways also were in merger talks this year, but US Airways pulled out last month. US Airways CEO Doug Parker, a vocal proponent of airline consolidation, has said that any mergers are good for the industry because they pull capacity out of the bloated system. "I think it's going to force other carriers to raise the question (of consolidation)," said Hunter Keay, airline analyst at Stifel Nicolaus. He said a merger between US Airways and American Airlines parent AMR Corp makes sense from a "network perspective." "It certainly raises the question," Keay said. "I don't see it happening in the short term." Reuters

Question: On 3 May 2010 United and which other airline announced a stock-swap to combine them into the world's largest airline?
Answer: Continental