Has United set sights on merger?

CHICAGO — Speculation that United Airlines may be destined for an eventual merger with another U.S. carrier intensified Monday with its reported hiring of Goldman Sachs & Co. to explore strategic options.

United, a unit of UAL Corp., has been advocating more industry consolidation for years under CEO Glenn Tilton and is in better position since leaving bankruptcy in February to take part in it.

The report Monday by Crain's Chicago Business that United had hired an investment banker appeared to add credence to widespread industry talk that it could merge with a carrier such as Continental Airlines or Delta Air Lines.

"It seems to show that United is serious about looking further into it — it's not just remarks by the CEO," said Standard and Poor's Corp. analyst Philip Baggaley.

Most observers and airlines think industry consolidation is likely at some point, but it's been hard to predict when and with whom.

Goldman is expected to help United assess the value of its domestic and international holdings, advise it on sales or purchases of domestic or international routes and scout for mergers, according to Crain's, citing unidentified people close to United.

United declined comment. "We don't comment on rumors or speculation," spokeswoman Jean Medina said.

Goldman Sachs spokeswoman Andrea Rachman said the New York investment bank also declined comment.

Shares in UAL rose 63 cents, or 2.3 percent, to close at $28.45 on the Nasdaq Stock Market.

Tilton has been increasingly signaling the possible involvement of United, the nation's second-largest carrier, in industry consolidation. He said in Chicago last week that the company is on solid footing to participate in the merger and acquisition market following three years of restructuring in bankruptcy, which ended in February.

He has not speculated on which airlines might come into play, but has said repeatedly that United will consider opportunities that arise.

"As we emerge from a difficult five years, it is time for us to begin to seize new opportunities," he said Monday in a speech to a transportation conference in Memphis. "United fully intends to expand our global reach to compete in the world's fastest-growing markets."