Continental chooses not to merge
Published: 28 Apr 2008
Continental Airlines' Board of Directors has decided not to merge with another airline at this time considering the current industry environment.
This was conveyed by the airline in a message to its more than 45,000 employees from Larry Kellner, Chairman and Chief Executive Officer, and Jeff Smisek, President.
The announcement emerges post recent development, as per which Continental was being tipped to join with United Airlines to create the world's biggest airline.
"The Board very carefully considered all the risks and benefits of a merger with another airline, and determined that the risks of a merger at this time outweigh the potential rewards, as compared to
Continental's prospects on a standalone basis," stated the airline.
"We have significant cultural, operational and financial strengths compared to the rest of the industry, and we want to protect and enhance those strengths -- which we believe would be placed at risk in a merger
with another carrier in today's environment. We will, however, continue to review potential alliances and our membership in SkyTeam. We are considering alternatives to SkyTeam as we carefully evaluate which major global alliance will be best for Continental over the long term," it added.
"While some would prefer to see Continental pursue a merger, we strongly believe we have made the right decision -- one that is in the best interests of our stockholders, co-workers, customers and the communities we serve."
For UAL's part, Chairman, President and Chief Executive Officer Glenn Tilton late on Sunday issued a statement saying that the carrier's "strategy is consistent. Consolidation is underway -- ensuring you have the right partner is everything. We will pursue all options to ensure a strong, sustainable future for our airline and will not shy away from the tough choices necessary to create value for our shareholders and benefit our employees and customers."
In mid-April, Delta Air Lines and Northwest Airlines agreed to a $17.7 billion merger in a deal that would create the world's largest carrier.
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