Newspaper article THE JOURNAL RECORD

Decision on Plan to Sell Continental Expected Soon

Newspaper article THE JOURNAL RECORD

Decision on Plan to Sell Continental Expected Soon

Article excerpt

NEW YORK (AP) _ The Bankruptcy Court judge overseeing Continental Airlines' 2-year restructuring is expected to decide soon whether to approve a plan to sell the carrier to Canada's largest airline and American investors.

Approval would be the last step before Continental leaves Bankruptcy Court for the second time in seven years and becomes the first airline since then to survive the reorganization process. Eastern, Pan Am, and Midway airlines failed in similar efforts and went out of business.

Continental is one of nine airlines with service to Will Rogers World Airport in Oklahoma City. In February, Continental had 7,097 enplanements in Oklahoma City, or 7.3 percent of the total enplanements for the month at Will Rogers Airport.

Continental would become the third major airline to sell part of itself to a foreign carrier to raise cash and tap into a fresh supply of passengers. Foreign airlines are attracted to U.S. carriers' domestic routes, which can bring in more foreign-bound passengers.

U.S. Bankruptcy Court Judge Helen Balick has said she wants to finish hearing testimony by Wednesday, but creditor attorneys say it could stretch into next week.

Creditors who object to Continental's plan say it is not feasible, a key requirement for a plan to be approved. Major objectors include the Air Line Pilots Association and NationsBank, a big Charlotte, N.C.-based bank.

John Luth, Continental's chief financial officer, is due to testify in support of the airline's prospects on Wednesday.

If Balick, who sits in Wilmington, Del., approves the plan, Continental would have a new partner in Air Canada and a group of U.S. investors who are putting a combined $450 million into Continental.

But the relationship wouldn't give Continental the kind of reach USAir has in its linkup with British Airways or Northwest has with KLM Royal Dutch Airlines.

Robert Ferguson, Continental chief executive, said in a recent interview that the company is talking to possible partners in Asia, Europe and Latin America.

"In our perfect choice we would try to form alliances in Europe and in Asia and another to the south," Ferguson said. …

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