Air Canada And United Make A Deal

Canada's two major airlines are once again looking south of the border for help in resolving their own mounting financial problems. For a while, it seemed Canada's two airlines would merge. But those talks died on Aug. 14, when Canadian Airlines International rejected an Air Canada offer that would have given the larger carrier 60% control over the merged company.

So on Aug. 18, Air Canada announced a deal with United Airlines that has the two carriers, among other things, coordinating their schedules and combining frequent-flier programs. Meanwhile, Canadian is scrambling to raise the financing it needs to reopen negotiations with American. American might be interested in a 25% stake in Canadian.

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