US Airways ends merger talks with United

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US Airways ends merger talks with United

Unread post by bimjim » Fri Apr 23, 2010

US Airways ends merger talks with United
by Aaron Karp
Friday April 23, 2010

US Airways announced yesterday that it had "discontinued recent discussions with" United Airlines regarding a "potential merger."

Speculation about advanced US-UA merger negotiations has been rampant over the last couple of weeks (ATWOnline, April 8), but US said its board called off the talks after "extensive review and careful consideration." Chairman and CEO Doug Parker said, "While it is our policy not to comment on rumors concerning strategic transactions, because of the persistent rumors about a possible transaction with United Airlines we believe it is appropriate to clarify the status of those negotiations."

He noted that US "has long been a proponent for consolidation in our industry" but will only participate in a combination if it "is in the best interests of our shareholders, customers, employees and the communities we serve." In a message to employees reported by several media outlets, he said, "For the foreseeable future we intend to remain a standalone carrier." He insisted US is "well along the road to near-term profitability."

Attention likely now will turn to whether UA and Continental Airlines, which already are engaged in an extensive cooperation pact (ATWOnline, June 20, 2008) and are both members of Star Alliance (ATWOnline, Oct. 28, 2009), will move toward a merger. CO Chairman, President and CEO Jeff Smisek yesterday declined to answer questions about possible talks with UA, saying only that "we are examining Continental's options."

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