Continental-United merger approved by DOJ

The U.S. Department of Justice has followed the European Commission's lead and approved a merger between Continental and United, a move that will create the world's largest airline.

The European Commission approved the deal a month ago, but the DOJ took slightly longer to ensure that the merger would not impede fair competition in the airline industry, where other major players such as Virgin, Delta and JetBlue compete with the carriers.

The two airlines agreed to merge in May in an all-stock deal. The new company, to be called United Continental Holdings, will be headquartered in Chicago, but will also maintain a major presence in Houston, Texas, which will be its largest hub. Together, Continental and United serve more than 144 million passengers every year traveling to 370 destinations in 59 countries. Both airlines provided domestic and international passenger and freight services, and will continue to do so following their merger.

Opponents of the deal worry the fact that there will only be four major American carriers left after the merger will lead to increased travel prices for passengers, but the DOJ believes the competition will be robust enough to keep pricing fair. In addition, the two carriers made the case that because there was little overlap between their routes, the new airline wouldn't dominate any specific area.

The merger will likely lead to some layoffs to eliminate redundancy in the new company structure, but it will also create new jobs.