Note to would-be airline acquirers. United Air Lines Inc. is still available. The world's second-largest airline, which has been looking for a merger for the better part of two years now, thought it had a partner lined up
in Continental Airlines Inc. But that deal is contingent on Delta Air Lines Inc. combining with Northwest Airlines Corp., a move that would void the golden share Northwest holds in Continental that allows it to block any Continental deal.
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United CEO Glenn Tilton has been among the industry's most outspoken advocate for consolidation, and he is apparently not letting the stalled Continental talks break his spirit. Speaking to reporters at the U.S. Chamber of Commerce Thursday, Tilton said that with fuel prices at new highs "the case for change including consolidation was compelling a year ago and has to be more so today."
Though few of Tilton's peers would likely disagree with him, finding a partner for United is no easy task. Industry sources say the perception that the airline has an uneasy relationship with its unions and didn't cut deep enough during its recent trip through bankruptcy makes would-be partners gun-shy. Even Continental appears more inclined to go it alone, though company executives are mindful that a merged Delta-Northwest might be so large that a combination could be necessary to remain competitive.
With oil prices contributing to two airline shutdowns this week alone and applying pressure across the industry, Tilton might soon get his wish for consolidation. But with United's role in consolidation far from certain, perhaps the executive is well advised to do what he can to keep the airline in the middle of the conversation. - Lou Whiteman
See TheDeal.com story on United's talks with Continental
See Reuters story with Tilton's comments
See story about airline shutdowns from Dealscape
See Dealwatch: Airlines
