Continental Expected to Make United Bid

According to the Philadelphia Enquirer, a Wall Street analyst fully expects Continental Airlines to bid on United Airlines in order to block the merger of United and US Airways.

Hunter Keay, a Stifel Nicolaus airline analyst explained in a client note Monday that a merger between United and US Airways would be a "a suboptimal scenario."

Keay cites pilot labor problems and risk of financial gain as two major flaws that would come with the deal. Keay added, "We expect Continental to respond to reported United-US Airways merger plans with a bid for United."

While airline experts agree that a Continental/United partnership is more viable in the long term, it takes two to tango. Both airlines came close to a deal in 2008, but Continental eventually walked. If the two were to team up it would replace Delta, who acquired Northwest Airlines in 2008, as the world's largest airline.

Source:  The Philadelphia Enquirer