US carriers cosy up


American Airlines, the world's second largest airline, is said to be pressing for a merger with Northwest, the fourth largest US carrier.

Any such move could threaten british Airway's attempts to forge an alliance with American Airlines.

Reports suggest talks are well under way. Speculation started at the headquarters of Northwest. Shares in the airline rose 20% on the back of the news while American's fell $1 to $28.

Northwest serves 150 cities worldwide and also owns 13% of Continental, a small rival airline. American serves 180 cities and has an extensive alliance with KLM - the Dutch airline.

At the same time British Airways has rejected an option to buy 20% of loss making Greek airline Olympic which has been managed for 11 months by Speedwing, BA's management consultancy arm.

It is a major setback for Greece's privatisation program and casts doubt on the airline's chances of survival. It has a record of heavy losses and labour disputes.

US carriers cosy up

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