Antitrust regulators at the Justice Department approved the $8 billion merger plan of United and Continental airlines late last week. The deal to create one of the world’s largest airlines is now set to be approved as early as Thanksgiving. Before the companies get the final go-ahead, the merger must be approved by the Transportation Department. United and Continental shareholders must also approve the deal and will vote on September 17.
The four-month antitrust investigation was speedier than expected. One of the greatest sticking points for the federal investigators was whether a United-Continental deal would monopolize the domestic flight market in New York. In order to gain approval from federal investigators, the airlines agreed to lease 18 round-trip flights to Southwest Airlines at Newark Liberty International Airport in New Jersey.
If the merger deal closes by the end of November, the Southwest flights between Newark and New York will begin in March 2011, with a full flight schedule planned for June 2011. The chief executive of Continental, Jeff Smisek, said that the deal will create for customers a world-class global operation while also “enhancing domestic competition at Newark.” Smisek is set to become the chief executive of the merged companies, which will be named United and headquartered in Chicago.
Justice Department approves United and Continental airlines merger (Los Angeles Times)