H  CONTINENTAL AIRLINES BOARD DISCUSSES MERGER WITH UNITED XXXXXXXX: JUMP HEADLINE GOES HEREY AND HEREY 

S1  Continental Airlines board of directors met Wednesday to discuss a merger with United Airlines, a person familiar with the situation said.

S2  That meeting likely indicates the two airlines are making progress in their talks, which earlier this week were reportedly bogged down over price issues related to an all-stock transaction.

S3  Another Continental board meeting is likely in the next several days.

S4  Speculation in and around the industry is increasing that the two airlines will, in fact, get a deal done.
S5 And that it could come as soon as this weekend.

S6  "It clearly indicates they are in pretty advanced stages," said Hunter Keay, an airline analyst with Stifel Nicolaus said of word that Continental's board had met.
S7 "I wouldn't be surprised if we have an announcement relatively soon.
S8 There's going to be some long nights this weekend without a doubt."

S9  Some details have already emerged, including that Continental's CEO, Chairman and President Jeff Smisek would serve as the CEO of a merged carrier and that United's CEO, Chairman and President Glenn Tilton would be non-executive chairman.
S10 The merged carrier - to be called United - would be based in Chicago.

S11  Neither airline has publicly confirmed the merger talks.
S12 Spokeswoman at both airlines declined comment again Wednesday.

S13  Continental and United held merger talks in 2008 but Continental ended them.

S14  Continental and United restarted merger discussions earlier this month after United again courted Tempe, Ariz.-based US Airways.
S15 Last week, the negotiations with US Airways were called off.

S16  If United and Continental marry, the new airline will be the nation's largest carrier, eclipsing Delta Air Lines, which merged with Northwest Airlines in 2008.

S17  Continental's shares closed up 55 cents at $22.17 Wednesday and United's closed up $1.24 to $21.75.

S18  An airline industry expert said airline officials want to make a decision about whether to merge as soon as possible.

S19  "Uncertainty is nobody's friend.
S20 You want to get this resolved as quickly as you can.
S21 Your whole organization is in limbo ,which is not good for anybody," said the industry observer.

S22  Meanwhile, local city and business leaders are continuing to reach out to Continental and United to make the case to locate the merged company's headquarters in Houston.

S23  The Greater Houston Partnership and mayor have reached out - through letters and calls - to both airlines bosses.
S24 And they've received no response yet, they said during an editorial board meeting Wednesday at the Houston Chronicle.

S25  "Our concern is we remain the headquarters for a lot reasons beyond simply what might in effect be a few hundred jobs going one way or another," Mayor Annise Parker said.
S26 "We believe in the long run it's better for the airport.
S27 It's better for the city of Houston, and what we've had is a number of one way conversations."

S28  Parker said she hopes the operational headquarters remain in Houston, even if the paper headquarters moves to Chicago.

S29  "That's where the power is," she said, adding that if Continental's management team leads the merged airline, it would make sense to keep the headquarters in Houston.

S30  jenalia.moreno@chron.com and purva.patel@chron.com XXX - End of Story3D

