Moody's may boost UAL, United Airlines

Moody's Investors Service said it placed its Caa1 corporate family rating and all of its other long-term debt ratings of UAL Corp. and United Airlines, Inc. on review for possible upgrade following its plans to merge with Continental Airlines, Inc.

Moody's also said it affirmed all of its debt ratings of Continental Airlines, including its corporate family rating at B2 and speculative grade liquidity rating at SGL-3. Its outlook remains negative.

The announced deal has Continental shareholders receiving 1.05 shares of UAL common stock for each of their existing Continental shares, Moody's said.

The combination of these two carriers would create the largest airline in the world, measured by annual revenues, the agency said. If the merger closes as planned, the combined company's credit profile would be indicative of a rating in the single-B category, Moody's said.

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