The European Commission has granted unconditional approval to the proposed United Airlines and Continental Airlines merger. U.S. authorities will need to grant final approval for the creation of what would become the world’s largest airline.
European Commission anti-trust regulators concluded that the transaction would not significantly impede effective competition in Europe.
“The commission concluded that the transaction would not significantly impede effective competition in the European Economic Area or any substantial part of it,” the EU said in a statement.
The EU said that the two airlines’ networks were complementary because they had hubs in different US cities and so the merger would lead only to small, incremental increases in the market shares of the parties.
This lack of overlap also extended to the airlines’ European networks, the commission added, and that this “will not give rise to concerns on any specific route”. It also noted that both carriers were part of the Star Alliance, and already co-operated extensively with Lufthansa and Air Canada.
United serves more than 230 US and international destinations of which nine are in the EU and Switzerland. Continental serves 132 US and 137 international destinations, with 26 being in the EU and Switzerland.
United CEO Glenn Tilton said: “We are pleased to have received this clearance from the European Union, a significant market for our combined new company, and we continue to work cooperatively with the U.S. Department of Justice toward an expeditious completion of our merger, which will benefit our customers, our people, our shareholders and the communities we serve.”
Continental CEO, Jeff Smisek, said: “Approval from the European Commission is another important step toward completing our merger with United. The combination of United and Continental brings together the two most complementary networks of any U.S. carriers, with minimal domestic and no international route overlaps. Together we will offer customers unparalleled global access.”
The companies announced their plans for an all-stock merger of equals in May and expect to close the deal in the fourth quarter of this year.