United May Request Smaller Guarantee

United Airlines plans to revise a request for a loan guarantee that the U.S. government rejected last week by asking for a smaller amount and pledging to repay the money faster, people familiar with the situation said.

The request for a $1.6-billion loan guarantee had been rejected by the Air Transportation Stabilization Board.

United parent UAL Corp. needs the guarantee to secure a $2-billion loan from J.P. Morgan Chase & Co. and Citigroup Inc. that would fund the Chicago-based airline’s exit from bankruptcy protection.

United would revise the proposal to repay the loan in five years rather than seven, the people said. The firm also may cut the size of the guarantee request by seeking money from an equity investor or a lender.