Hawaiian and Aloha airlines call off merger agreement

Sunday, March 17th 2002, 12:00 am

By: News On 6

HONOLULU (AP) _ The planned merger of Hawaiian and Aloha airlines, which generated widespread opposition from employees, stockholders and consumers, has been called off, a Hawaiian spokesman said Saturday night.

``It's clear that the parties will not be able to satisfy the conditions of the merger agreement,'' Hawaiian spokesman Keoni Wagner said.

Aloha and Hawaii unveiled the proposed merger in December, saying it was necessary for the financial health of both companies. A deadline of April 18 had been set for its completion.

Those opposed to the merger of the state's only two interisland air carriers said it would lead to higher prices and poorer service.

Class-action lawsuits seeking to block the merger were field in state court on behalf of several groups, including employees and shareholders.

Additionally, Hawaii's three Republican state senators asked the U.S. Justice Department to block the deal.

Hawaiian Chairman John W. Adams announced earlier Saturday that the airline rejected a deadline extension requested by TurnWorks Inc., a Texas-based company working to merge the two carriers.

In response to the announcement, Aloha spokesman Stu Glauberman said, ``Aloha is aware of the decision by Hawaiian Airlines, and will issue comments at the appropriate time.''

``TurnWorks is extremely disappointed,'' the company said through a public relations firm in Hawaii.

The merger was to create a new company, Aloha Holdings Inc., to be headed by Greg Brenneman, TurnWorks' chairman and chief executive. He helped lead Continental Airlines to its turnaround as its president and chief operating officer.