United-Continental Merger: Continental Is Taking the Reins, No Question

Last Updated May 21, 2010 6:00 AM EDT

United (UAUA) and Continental (CAL) have finally released a couple more morsels around their proposed merger. The integration team has been announced in an SEC filing, and there's one person who is noticeably absent: United President John Tague. This certainly points to Continental holding the reins in the combined company.

Here's how things are stacking up. The Integration Steering Committee (ISC) will be made up of the following officers:

  • United
    • Glenn Tilton, Chairman and CEO
    • Kathryn Mikells, EVP and Chief Financial Officer
    • Pete McDonald, EVP and Chief Administrative Officer
  • Continental
    • Jeff Smisek, Chairman, President, and CEO
    • Zane Rowe, EVP and Chief Financial Officer
    • Jim Compton, EVP and Chief Marketing Officer
Underneath the ISC will be the Integration Management Office (IMO). This will be led by Pete McDonald from United and Continental's Staff VP and Assistant General Counsel Lori Gobillot. They will handle all the planning work from that office and report to the ISC.

There are only two things surprising about this announcement. One, it's shocking that they've only been able to create three TLAs (Three-Letter Acronyms) here. I expected so much more. Two, as you can see, John Tague is nowhere to be found. The most important commercial execs at both airlines are on this team . . . except for Tague.

What does that mean? I suppose the argument could be made that Tague will focus on running the airline while everyone else is tied up, but I don't buy it. If that's the case, you'd think that they would have at least mentioned him in the letter sent to employees, but I haven't seen him mentioned in quite some time . . . anywhere.

More likely is that Tague will not be a part of the combined airline, and that's exactly what I would have expected. It's clear that Jeff Smisek will be running this ship, and John Tague was the greatest potential threat in terms of a power struggle. If I were Jeff, I wouldn't want Tague around, and that's what appears to be happening. Continental is taking the reins.

Photo via United Airlines