Continental Air Gets Bid for Its Share in Airline

Continental Airlines is negotiating to sell its interest in Air Micronesia, Continental officials said Tuesday.

Airline spokesman Ned Walker would not identify the potential buyers or reveal the purchase offer.

But the Wall Street Journal reported Tuesday that Continental was expected to sell the stake for $250 million in cash and securities.

Walker would say only that airline chief Robert Ferguson “did tell an employee or a management meeting last week that we had received a proposal for Air Micronesia and that we are in discussions with that group.”

Continental’s interest in Air Micronesia has been for sale for more than a year. Continental controls certain Air Micronesia route authorities.

Continental also manages Air Micronesia, which is based in Guam and flies between Guam, Hawaii, Micronesia and other Pacific locations, and gets 99% of the venture’s revenue.

The Journal quoted unnamed sources as saying that the investor group, Pacific Micronesia Corp., consists of a member of Air Micronesia’s management, Pan Am’s George Doubleday and Scott Gibson, a former marketing executive at Continental. The group is backed by a Hong Kong-based bank called Arral & Partners, the newspaper said.

The Journal said the group was prepared to sign a letter of intent with Continental within days, although Continental creditors are still willing to entertain higher offers for the airline’s share of the venture. The carrier entered Chapter 11 bankruptcy protection last December.