Viewing page 107 of 116

This transcription has been completed. Contact us with corrections.

OPINION
The question before us in this proceeding is whether we should at this time approve an agreement between Eastern Air Lines, Inc. (Eastern) and Colonial Airlines, Inc. (Colonial) providing for the acquisition of the assets of Colonial by Eastern. Sections 408(b) and 412(b) of the Act require that such agreements be presented to the Board for approval and that the Board shall approve the agreement unless it finds that the agreement will not be consistent with, or is adverse to, the public interest. 1/
We have previously had occasion to consider an acquisition agreement between Eastern and Colonial. In Docket No. 5666, Eastern and Colonial applied for approval of a somewhat similar agreement. 2/ After a full public hearing and the completion of the customary procedures, we found,[[underline]] inter alia[[underline]], that an Eastern-Colonial integration would be consistent with the public interest and would not create a monopoly and restrain competition or jeopardize another air carrier not a party to the agreement; that an Eastern-Colonial integration would result in a greater advantage to the public than would flow from a National-Colonial combination; but that Eastern had acquired unlawful control of Colonial in violation of Section 408, prior to the approval of the agreement by the Colonial management and stockholders. We concluded that Eastern's power to control Colonial had not influenced or affected the subsequent execution of the acquisition agreement then before the Board, and that important public interest

_________________________
1/ Section 408(b) empowers the Board to approve such agreements "upon such terms and conditions as it shall find to be just and reasonable and with such modifications as it may prescribe." With respect to the transfer of Colonial's certificates, section 401(i) provides that such transfers are to be approved only if found consistent with the public interest.
2/ Consolidated with that proceeding was an investigation to determine whether a National-Colonial integration would be in the public interest.