United Airlines’ and Continental Airlines’ respective shareholders voted on September 17 to approve the merger of a wholly owned subsidiary of United’s parent UAL Corporation into Continental, allowing the merger of the two airlines to go ahead by October 1.
Continental Airlines’ shareholders voted at a meeting held in Houston and UAL’s shareholders voted at a meeting held in Chicago. UAL Corporation’s primary subsidiary is United Airlines.
More than 98 per cent of the votes cast by Continental’s shareholders and 75 per cent of its shares outstanding were voted in favor of the transaction. UAL saw similar results: More than 98 per cent of UAL shareholders’ votes cast and 84 per cent of the shares outstanding were voted in favor of the merger.
“This vote is a significant step toward closing our merger with Continental, creating the world’s leading airline and the industry’s best network for our customers, a strong company that provides career opportunity for our people and an airline that can deliver return for our shareholders,” says Glenn Tilton, United’s chairman and CEO. “There is much work ahead as we bring these two companies together, pulling the best from both of our companies, and building on the work we have each done to strengthen our airlines.”
“We are grateful for our stockholders’ strong vote of confidence in this merger,” says Jeff Smisek, Continental’s chairman, president and chief executive officer. “In approving the transaction, our stockholders recognized the value of bringing together Continental and United to create a platform for increased profitability and sustainable long-term value.”
Smisek will become chief executive officer of the merged airlines, which will operate under the United Airlines name but will use Continental’s current tail logo and most other elements of Continental’s livery.
The merger will create the biggest airline in the world, even though Continental has agreed to divest 18 pairs of take-off and landing slots at its Newark Liberty International Airport hub to Southwest Airlines in order to meet the U.S. Department of Justice’s conditions for conferring antitrust approval on the merger.
United and Continental announced an all-stock merger of equals on May 3. The companies have already received clearance on their proposed merger from the U.S. Department of Justice and the European Commission.