Reports of merger talks between Continental and United Airlines

United Airlines is holding preliminary talks to merge with Continental Airlines, according to a report in the New York Times.

The newspaper said that such a deal, if concluded, would further reshape the struggling US airline industry.

United Airlines emerged from bankruptcy protection in February,

It quoted sources as saying that the negotiations recently gained momentum following last month's bid by US Airways to buy Delta for about $8bn (€6bn).

Delta, the third-biggest US carrier, rejected the offer, saying it was on course to come out of bankruptcy as an independent player next year.