The new airline will retain the United name and will be based in Chicago. The deal is valued at $3.17 billion.
At a press conference, it was called "match made in heaven," although heaven must wait for labor groups, shareholders and the US Department of Justice’s antitrust division. But it will almost certainly happen.
Asia will undoubtedly be a critical part of the combined carrier’s route network. Walter Dias, managing director for Greater China and Southeast Asia at Continental, told FinanceAsia last month that if an airline wants to be a player today, it has to be "looking to Asia."
Shashank Nigam, Singapore-based chief executive of SimpliFlying.com, an aviation blog and airline brand consulting firm, said it is unlikely the merged entity will, at least initially, be a serious threat to Asia-Pacific heavyweights such as Cathay Pacific Airways and Singapore Airlines. He said, "In order to have any chance of racing against Asian carriers, the new airline will have to drastically up its game in terms of service, product and brand strategy."
Finance Asia said the biggest loser from the deal is likely to be American Airlines. With only six daily flights to Tokyo and Shanghai, it is the smallest US carrier operating in the region. American was due to launch a new flight from Beijing to Chicago today, but postponed the launch because it had not received "commercially viable landing and takeoff slots" in the Chinese capital.