CO/UA Merger announcement expected on Monday
CO/UA Merger announcement expected on Monday
From Wall Street Journal
Continental Airlines Inc. and UAL Corp.'s United Airlines are expected to announce Monday that they are merging to form the world's largest airline by traffic, people familiar with the matter said.
The United board is meeting Friday, while Continental's board is meeting Friday and Sunday to discuss the deal, these people said.
These people cautioned that negotiations could fall apart at the last minute as they did in 2008, when Continental backed away. But after a hiccup over pricing the transaction, the talks appear to be on track, they said.
United is in a much different position than two years ago. Earlier this week, United narrowed its first-quarter loss to $82 million, compared with a year-earlier loss of $382 million. Revenue rose by 15%, to $4.2 billion.
Those earnings led United to believe it had more leverage in the talks, which were at an impasse this past weekend over the share-price ratio used in a stock-swap transaction.
United, as of last week, wanted the exchange terms to be based on where its stock closes the day before any agreement is signed. But that would lower the value for Continental shareholders, since UAL shares have climbed more than Continental's.
Continental's board met Wednesday to be briefed on the discussions. It was also asked to consider a range of prices in an effort to resolve the share-swap disagreement.
In 4 p.m. trading on the Nasdaq Thursday, UAL shares were down 1.3% to $21.47, while Continental shares were up 2.4% to $22.70 on the New York Stock Exchange.
Continental already has agreed in theory to allow the combined airline to be based in Chicago, United's home base, and to retain the United brand.
Jeff Smisek, Continental's chief executive officer, would become CEO of the merged carrier; Glenn Tilton, UAL's CEO, would become non-executive chairman for two years, after which Mr. Smisek would take over that role too, said people familiar with the matter.
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Continental Airlines Inc. and UAL Corp.'s United Airlines are expected to announce Monday that they are merging to form the world's largest airline by traffic, people familiar with the matter said.
The United board is meeting Friday, while Continental's board is meeting Friday and Sunday to discuss the deal, these people said.
These people cautioned that negotiations could fall apart at the last minute as they did in 2008, when Continental backed away. But after a hiccup over pricing the transaction, the talks appear to be on track, they said.
United is in a much different position than two years ago. Earlier this week, United narrowed its first-quarter loss to $82 million, compared with a year-earlier loss of $382 million. Revenue rose by 15%, to $4.2 billion.
Those earnings led United to believe it had more leverage in the talks, which were at an impasse this past weekend over the share-price ratio used in a stock-swap transaction.
United, as of last week, wanted the exchange terms to be based on where its stock closes the day before any agreement is signed. But that would lower the value for Continental shareholders, since UAL shares have climbed more than Continental's.
Continental's board met Wednesday to be briefed on the discussions. It was also asked to consider a range of prices in an effort to resolve the share-swap disagreement.
In 4 p.m. trading on the Nasdaq Thursday, UAL shares were down 1.3% to $21.47, while Continental shares were up 2.4% to $22.70 on the New York Stock Exchange.
Continental already has agreed in theory to allow the combined airline to be based in Chicago, United's home base, and to retain the United brand.
Jeff Smisek, Continental's chief executive officer, would become CEO of the merged carrier; Glenn Tilton, UAL's CEO, would become non-executive chairman for two years, after which Mr. Smisek would take over that role too, said people familiar with the matter.
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The overall result of this should be very good for both. United augments Conti for the Asian routes and Conti will augment for S. America. Both have a strong network to EU.
As for the merger of the seniority lists.........
...........
, somebody is going to get banged up, unfortunately.
As for the merger of the seniority lists.........
..........., somebody is going to get banged up, unfortunately.
No integrated seniority list exists yet !
It has only been a few days since the announcement, do you really think that could have been done already ?
Anyone can put together a list based on DOH but it doesn't mean anything!!
DOH !
I wish..
It has only been a few days since the announcement, do you really think that could have been done already ?
Anyone can put together a list based on DOH but it doesn't mean anything!!
DOH !
I wish..
