United CEO hospitalized after reported heart attack
United Continental Holdings (UAL) on Friday confirmed that CEO Oscar Munoz was hospitalized. The airline's chief executive reportedly had suffered a heart attack.
"We have been informed by Oscar's family that he was admitted to the hospital on Thursday, and we will provide further details as appropriate," United said in a statement. "In the meantime, we are continuing to operate normally."
On the job a little more than a month and 56 when he was hired, Munoz took the helm of the carrier at an especially difficult time, replacing Jeff Smisek as United's CEO after Smisek stepped down amid a federal investigation into the airline's handling of a case involving the former chairman of the Port Authority of New York and New Jersey.
United, along with other major U.S. carriers, is being investigated for possible collusion in keeping airfares high, the U.S. Department of Justice said this summer.
One corporate governance expert said the carrier's struggles on multiple fronts makes it that much more important for United to quickly tap a temporary replacement for Munoz.
"Given the turmoil, they are going to need an interim leader, and in a all likelihood they are going to need a new CEO," said Mark Rogers, founder and CEO of BoardProspects.com. "There is talk of board call tonight -- I wouldn't be surprised if you don't see an interim CEO by Monday."
One of two board members -- former Boeing executive Carolyn Corvi or retired KeyCorp CEO Henry Meyer -- would be logical replacements, said Rogers. "Given the federal investigations, you'd probably want to stay away from anyone in management."
The carrier has clashed with unions and contended with computer breakdowns since its formation in 2010 with the merger of former United parent UAL and Continental Airlines.
United took out full-page advertisements in newspapers across the country on Oct. 1 to apologize to consumers, with Munoz acknowledging that in the five years since Continental and United merged, "we haven't lived up to your expectations or to the promise and potential of that day."
Munoz had a heart attack in the last 24 hours, Dow Jones news wire reported on Friday.
In addition, the Association of Flight Attendants issued a statement saying that Munoz had suffered a heart attack and was in a Chicago hospital. "AFA members around the globe are sending support and healing thoughts for Oscar. We offer support for his family and await good news," the statement said.
The former chief operating officer of railroad giant CSX (CSX) is a married father of four and was dubbed one of the "100 Most Influential Hispanics" by Hispanic Business magazine.
United was slower than other airlines to return to profitability after the financial crisis that began in 2008. It has posted record profits recently, helped by cheaper jet fuel. The company earned $1.7 billion in the first six months of 2015, although revenue slipped 2.6 percent.
United, which is scheduled to report third-quarter earnings on Oct. 22, declined further comment.
S&P Capital IQ analyst Jim Corridore said that until more details are known about Munoz's health, the situation could cause uneasiness among investors. He said the company has enough executive talent to continue its improvement efforts.
Vicki Bryan, an analyst for bond-rating company Gimme Credit, said, however, that United's other executives were the same ones who supported Smisek's "long, calamitous reign." She expressed caution about United's turnaround, adding that "unfortunately, Mr. Munoz's illness could at best delay that even longer."
The carrier's stock lost $1.79, or 3.1 percent, to close at $55.97.
-- Associated Press contributed to this report