Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!americast.com!americast.com!americast-post Newsgroups: americast.twt.metro From: americast-post@AmeriCast.Com Organization: American Cybercasting Approved: americast-post@AmeriCast.com Subject: Airline to make decision on bidders Date: Mon, 9 Nov 92 14:59:57 EST Message-ID: \SE B;METROPOLITAN;MONEY \HD Airline to make decision on bidders \BY David Field \CR THE WASHINGTON TIMES Continental Airlines today is to announce its selection among competing bidders to take it out of its 23-month-long bankruptcy, after the ranks of its five would-be saviors had dwindled to two serious contenders. The airline, based in Houston, is the nation's fifth largest and is a major east-west and trans-Pacific carrier. It also operates frequent daily service between Washington National and Newark International airports. With more than $5 billion in annual revenues and a national market share of about 9 percent, Continental is close to profitability, having reduced costs and trimmed deficits in reorganization. After trying to reorganize on its own, the airline in August began receiving buyout offers from investors and from foreign airlines. Continental will tell U.S. Bankruptcy Judge Helen Balick in Wilmington, Del., of its choice sometime today, airline spokeswoman Peggy Mahoney said. By September, the bidding war included Lufthansa German Airlines in alliance with investor Marvin Davis; Air Canada; two competing investors each allied with one of the two competing Mexican airlines; and a former Continental employee. Foreign airlines, analysts said, were excited by the prospect of picking up a large U.S. carrier in a deal similar to that more recently proposed by Arlington-based USAir and British Airways PLC. Continental has a strong domestic route system that could be a feeder for overseas flights and has near dominance of important airports, including Newark, Houston and Cleveland, as well as a major stake of traffic at Denver. The highest bids reached $425 million, but Lufthansa's withdrawal last month, after the demise of the former employee's bid, reduced the bargainers. Serious bidding, sources said, is limited to two groups: * Air Canada, allied with two Fort Worth, Texas, investors and led by former Continental Chief Executive Officer Hollis Harris, who was ousted in a board coup in 1991. * Houston investor Charles Hurwitz, whose Maxxam Corp. was the first bidder and who now has substantial backing from Aeromexico. A Mexican investor, Alfredo Brener, whose family controls Mexicana Airlines, has said he would make a bid, but he is believed to have withdrawn. The Maxxam bid would give Houston's business community a stake in Continental and an alliance on north-south routes to Mexico and Latin America, while the Air Canada bid would link Continental with another strong trans-Pacific carrier. This article is copyright 1992 The Washington Times. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM