SOURCE: Honolulu Star-Bulletin <http://doit1.starbulletin.com/breaking/FMPro?-db=3Dbreaking.fp3&-format=3Dreco= r d%5fdetail.htm&-lay=3Dweb&-sortfield=3Dcpriority&-sortfield=3Dserial&-sortorder=3Dd= e scend&public=3Dyes&-recid=3D38894&-find=3D> Hawaiian and Aloha airlines talk merger Both airlines have suffered since the September 11 attacks Star-Bulletin staff Aloha Airlines and Hawaiian Airlines =8B reeling from the Sept. 11 economic downturn =8B are expected to announce tomorrow that they are exploring a merger. The rival carriers plan to schedule a news conference tomorrow afternoon to unveil some of the details of the plan, people familiar with the deal said. The proposal, which has been rumored in the local business community for several months, also calls for a new investor group to take part in the new airline. The group includes veteran airline industry executive Greg Brenneman, who heads a Houston-based private investment firm, Turnworks Inc. Brenneman previously served as president and chief operating officer of Continental Airlines before stepping down in May. Paul Casey, chief executive officer of Hawaiian Airlines, had no comment. A spokesman for Aloha Airlines did not return calls. The deal will require anti-trust clearance from the Department of Justice. Sources said some of the details are still being worked out and that any merger would take several months to be completed. Such a deal would likely result in job cuts at both airlines as the merged airlines =8B which have aggressively competed for decades =8B would look to eliminate duplicative functions. Hawaiian Airlines currently employs about 3,100 employees while Aloha has about 3,000 workers. Since Sept. 11, the two airlines have cut more than 600 jobs and have reduced the number of interisland flights. Of the two airlines, Aloha has been the hardest hit. Aloha -- a privately held company led by the heirs of local financiers Sheridan Ing and Hung Wo Ching -- launched its mainland service only to see business tumble as a result of the terrorist attacks in New York and Washington, D.C. In an August filing with the U.S. Department of Justice, the company said i= t lost $205,618 during its second quarter. In November, publicly traded Hawaiian Airlines posted a net profit of $12 million for its third quarter. The company said it expects business to decline into next year. Brenneman, 40, is well respected in the U.S. airline industry for helping turn around Continental Airlines, the nation=B9s fifth largest carrier. He left the airline in May to take on new challenges. Brenneman serves as Turnwork=B9s chairman and chief executive officer and currently serves on the boards of Continental and Home Depot Inc. In 1999, Brenneman=B9s total compensation at Continental topped $5 million, according Bloomberg News. --=20 David Mueller / HNL kawika42@mac.com http://www.quanterium.com