United seeks Northeast flights, southern hub
By Kelly Yamanouchi
Denver Post Staff Writer
Article Last Updated: 06/13/2007 09:07:23 AM MDT
United Airlines, which has been pushing for airline consolidation, wants to gain more northeast flights and a southern hub for flights to Latin America and the Caribbean.
In response to a question at a Merrill Lynch conference today about strategic objectives in an airline combination, United chief financial officer Jake Brace said, "Our network lacks a northeast presence. We also lack a southern tier hub," which he said is important for service to Latin America and the Caribbean.
Continental Airlines, which has a strong presence in Latin America and a strong hub in Newark, has been rumored as a potential merger partner for United.
But momentum for airline consolidation appears to have slowed, particularly after an attempt by US Airways to take over Delta Air Lines failed earlier this year.
Calyon Securities analyst Ray Neidl earlier this month reduced his rating on United parent UAL Corp. shares to ADD from BUY, saying, "In our opinion, there is no consolidation premium in airline share prices nor should there be at this time, since we believe there will be no major industry mergers this year."
Though UAL is interested in consolidation, it "is not something one company can do," Brace said. "Our position is very clear. Other people's is not."
He added that United does not believe that hostile takeovers in the airline industry are very successful.
"Our belief is you have to do something on a consensual basis," Brace said.
Staff writer Kelly Yamanouchi can be reached at 303-954-1488 or at kyamanouchi
By Kelly Yamanouchi
Denver Post Staff Writer
Article Last Updated: 06/13/2007 09:07:23 AM MDT
United Airlines, which has been pushing for airline consolidation, wants to gain more northeast flights and a southern hub for flights to Latin America and the Caribbean.
In response to a question at a Merrill Lynch conference today about strategic objectives in an airline combination, United chief financial officer Jake Brace said, "Our network lacks a northeast presence. We also lack a southern tier hub," which he said is important for service to Latin America and the Caribbean.
Continental Airlines, which has a strong presence in Latin America and a strong hub in Newark, has been rumored as a potential merger partner for United.
But momentum for airline consolidation appears to have slowed, particularly after an attempt by US Airways to take over Delta Air Lines failed earlier this year.
Calyon Securities analyst Ray Neidl earlier this month reduced his rating on United parent UAL Corp. shares to ADD from BUY, saying, "In our opinion, there is no consolidation premium in airline share prices nor should there be at this time, since we believe there will be no major industry mergers this year."
Though UAL is interested in consolidation, it "is not something one company can do," Brace said. "Our position is very clear. Other people's is not."
He added that United does not believe that hostile takeovers in the airline industry are very successful.
"Our belief is you have to do something on a consensual basis," Brace said.
Staff writer Kelly Yamanouchi can be reached at 303-954-1488 or at kyamanouchi