United and Continental have moved a step closer to merging after the US Department of Justice (DOJ) finished is investigation of the deal following the carriers agreeing to lease 18 Newark slot pairs to Southwest Airlines.
Closing of the DOJ review follows clearance for the merger from the European Commission in July. Continental and United explain they're still in discussions with US state attorney generals, and "hope to conclude those discussions expeditiously with a positive outcome". The US Department of Transportation still needs to issue its final order.
At the time Continental and United announced their plans to merge in May, questions arose over how long DOJ's review of the tie-up would take. In Congressional hearings scrutinising the proposed merger Representative James Oberstar, who has expressed strong opposition to airline mergers, warned of a "different spirit" in the current Justice Department.
Under the previous administration of President George W. Bush Delta and Northwest received DOJ's endorsement roughly six months after they unveiled plans to merge.
Analysts saw few red flags being raised by DOJ in its review of the Continental and United merger, with JP Morgan estimating the merged carrier would have 13 US domestic nonstop overlaps, with 11 transitioning to monopoly or duopoly status.
Shareholders at Continental and United are scheduled to vote on the merger 17 September, and believe the transaction should close by 1 October. The carriers are aiming to achieve a single operating certificate from the US FAA by mid-2012.
Source: Air Transport Intelligence news
