UAL Corp., parent of United Airlines, would like to find a merger partner with a Southern tier hub and a strong presence in the Northeast, the carrier's chief financial officer said on Wednesday.
Speaking at a Merrill Lynch investor conference, Jake Brace said the No. 2 U.S. airline remains interested in consolidation despite a lessening in industry speculation on the subject.
Consolidation is not something that one company can do in isolation, Brace said on a Webcast of the conference. Our belief is that you have to do something on a consensual basis.
He noted the failed hostile takeover by US Airways Group for Delta Air Lines and resistance by Midwest Air Group to a hostile bid from AirTran Holdings.
Industry experts generally agree that consolidation may be the best way for airlines to reduce the excess capacity -- number of seats for sale -- that has depressed fares and revenue for several years.
Early this year, however, talk of consolidation died down after Delta rejected the US Airways bid. Some analysts believe airlines will resist mergers until an industry downturn and financial instability make it necessary for survival.
The airline industry has been on the mend following a years-long slump, but a weakening domestic revenue outlook has cast doubt on the prospects for recovery.
UAL shares were down 1 percent at $34.25 on Nasdaq in morning trade.