United Airlines and Continental shuffle executive ranks as EU approves merger


The European Commission granted the United/Continental merger unconditional clearance and concluded the merger would not raise any specific concerns in Europe or the trans-Atlantic. The move came only minutes after the two airlines announced their executive suite which would not include either United President John Tague or CFO Kathryn Mickells.

"We are pleased to have received this clearance from the European Union, a significant market for our combined new company, and we continue to work cooperatively with the US Department of Justice toward an expeditious completion of our merger, which will benefit our customers, our people, our shareholders and the communities we serve," said UAL Chair, President and CEO Glenn Tilton.

"Approval from the European Commission is another important step toward completing our merger with United," said Jeff Smisek, Continental's Chairman, President and CEO. "The combination of United and Continental brings together the two most complementary networks of any US carriers, with minimal domestic and no international route overlaps. Together we will offer customers unparalleled global access."

New executive slate

United executives join leaders from Continental to run the merged carrier. Graham Atkinson, President of Mileage Plus and Rosemary Moore, Senior VP of Corporate and Government Affairs, are joining Tague and Mickells in leaving the company.

Tilton becomes the Non-executive Chair of the combined entity. Mickells will be succeeded by Continental CFO Zane Rowe, who joined Continental in 1993 and Continental Chair and CEO Jeff Smizek takes on Tague’s title of President. The rest of the merged executive team included Pete McDonald, 40-year United veteran as Chief Operations Officer, and Keith Halbert, who joined United two years ago, as Chief Information Officer.

Also on deck is Nene Foxhall, at Continental since 1995, overseeing the communications and government affairs functions; and Jeff Foland, at United since 2005, will lead the combined carrier’s loyalty program. Continental’s Chief Marketing Officer Jim Compton assumes the same role at the merged carrier while Continental’s Mike Bonds, a 15-year Continental veteran, will be responsible for human resources and labour relations in a move that signals a change in employee/labour relations. Finally, Tom Sabatino, who joined United in 2010, will be general counsel. All appointments are pending board approval.

Mr Tilton said, "We have exceptional executives across our two companies; this created a superb talent pool from which to determine the senior executive team to take the company forward – and, at the same time, we have equally talented people who will continue to contribute to successfully executing our individual performance agendas between now and close."

The new leadership team will work with Smisek to design the overall officer-level organisation and select the remainder of the leadership team.  Concurrently, the companies are developing a talent-selection process for other management and clerical roles and refining the planned organisational structure.  The companies expect the merger to close before year-end.  

"This outstanding team represents a great blend of experience and expertise at both airlines,” said Smizek in making yesterday’s announcement. “I look forward to working together with them as we create the world's leading airline."

"The enthusiasm and ‘can do’ spirit of this management team helped to produce breakthrough gains at United during one of the toughest periods in the company's history,” said Jim O’Connor, United’s lead director who has serve on the board for 26 years. “Never satisfied with the status quo, this team has given all of us a glimpse of just how good we can become.”

Parting words from executives on the move

John Tague

Tague joined the company in 2003 while United was restructuring under Chapter 11 protection as executive vice president of customer and has held several leadership positions, including chief operating officer. As president, he has P&L responsibility for the airline and has all airline management functions. Additionally, he has all revenue and customer responsibilities. In the last year, United has delivered a USD1.2 billion revenue improvement, generated a USD750 million profit improvement, tightly managed its costs and increased its margin by 16 points, delivering the industry’s leading profit margin year to date, according to the airline. Since assuming his current responsibilities, United’s customer satisfaction has improved by 70% domestically and on-time performance has gone from worst to first.

“Without a doubt, my time with United is my most professionally rewarding experience to date,” said Tague. “Being a member of the team that successfully led United through a USD23 billion restructuring provided me with a foundational experience to build upon and help United achieve its potential. Receiving the mandate to create a step change in United’s performance gave me the opportunity to rethink the way we do business, drive systemic improvement and build a phenomenal management team that is continuing to innovate and delivering industry-leading results. This will be, for me personally, the perfect time to move on to the next challenge in my career, knowing that United is set on the best course for long-term success and a strong future."

Kathryn Mikells

Mikells joined United in 1994 and has held numerous leadership positions. As CFO, she oversees all corporate finance functions and also is responsible for mergers and acquisitions, fleet planning, corporate development and strategy and investor relations. She played a significant role in United’s restructuring, helping to coordinate the case, and, as treasurer, restructured the company’s debt portfolio and ensured it had the financing needed to exit bankruptcy. As the head of investor relations, she helped reposition United with the financial analysts and investors. She was named CFO when United faced significant financial challenges, including high oil prices and dealing with the effect of a devastating recession, and led the company’s efforts to increase its cash, improve its hedge book, order new aircraft and negotiate a merger with Continental.

“I am proud to have played a pivotal role in United’s extraordinary turnaround and the merger that will create the world’s preeminent airline,” she said. “I have always been energized by the positive attitude of our management team, especially during challenging times in our industry, and the finance team is no exception. From raising USD4 billion in financings to supporting the work that has delivered the best cost reductions in the business, the team has been focused on taking the right actions to turn our performance around and our second quarter results are the clear evidence of that work. I can’t imagine leaving on a higher note, and look forward to the next chapter of my career.”

Graham Atkinson

Atkinson joined United in 1991 and has held key customer-facing leadership roles, including senior vice president of Worldwide Sales and Alliances, senior vice president of International, senior vice president of Marketing, and most recently president of Mileage Plus, where he is responsible for developing Mileage Plus as a stand-alone business and ensuring that United is well positioned to address the changing landscape of loyalty programs and meet the needs of the company's most loyal customers.

United is a dramatically different company today than it was even five years ago,” he said. “We have extended our network and our partnerships worldwide. We have changed the way we sell our product, transforming our sales force and delivery channels, and, most importantly, are putting the customer front and center. We have built the industry’s best loyalty program in Mileage Plus, which will only get better for our customers upon our merger with Continental, extending earning and redeeming possibilities.”

Rosemary Moore

Moore joined United in 2002, having worked with Tilton at Texaco and Chevron. Moore has led efforts to support business objectives and enhance the company’s image and reputation through government relations, corporate responsibility and strategic communications, including media relations, employee communications and investor relations.

“There is no other industry that has the unique challenges of the airline industry and working with Glenn and the team to transform United and, at the same time, relentlessly press for industry reform, has been work I enjoy,” Moore said. “There is nothing better than working on difficult issues with a great team, and it is terrific to see all that we have accomplished and go on to another opportunity to contribute.”

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