NEW YORK—UAL Corp., the parent of United Airlines, is in separate merger talks with Continental Airlines and US Airways, people familiar with the matter said in a Reuters report.
The airlines are alternatively seeking a three-way alliance should merger talks falter.
United is said to be the closest to reaching a deal with Continental. The two airlines nearly merged in 2008, but Continental pulled out of negotiations at the last moment to remain independent.
In 2000, United and US Airways agreed to merge, but the deal fell apart due to antitrust concerns and union issues.
Reuters did not name the sources as negotiations are private.
United has broached the topic of a merger with both airlines separately in recent months as airlines are still struggling with weak demand—especially corporate travel—following the deepest recession since the Great Depression. The International Air Transport Association said that the industry lost $11 billion last year collectively.
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All three airlines are part of the Star Alliance, a network of several global airlines that share routes and set fares.
United, which has hubs in Chicago and San Francisco, has a strong presence in the Midwest and the West Coast, as well as in the Far East. Continental and US Airways are both strong in the U.S. Northeast market.
However, the jury is still out regarding whether bigger is better in the airline industry. Delta—which acquired Northwest Airlines—lost $1.2 billion in 2009, and reported a net loss of $25 million during the fourth quarter of 2009.
The airlines are alternatively seeking a three-way alliance should merger talks falter.
United is said to be the closest to reaching a deal with Continental. The two airlines nearly merged in 2008, but Continental pulled out of negotiations at the last moment to remain independent.
In 2000, United and US Airways agreed to merge, but the deal fell apart due to antitrust concerns and union issues.
Reuters did not name the sources as negotiations are private.
United has broached the topic of a merger with both airlines separately in recent months as airlines are still struggling with weak demand—especially corporate travel—following the deepest recession since the Great Depression. The International Air Transport Association said that the industry lost $11 billion last year collectively.
{etrelated 33010}
All three airlines are part of the Star Alliance, a network of several global airlines that share routes and set fares.
United, which has hubs in Chicago and San Francisco, has a strong presence in the Midwest and the West Coast, as well as in the Far East. Continental and US Airways are both strong in the U.S. Northeast market.
However, the jury is still out regarding whether bigger is better in the airline industry. Delta—which acquired Northwest Airlines—lost $1.2 billion in 2009, and reported a net loss of $25 million during the fourth quarter of 2009.
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