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Continental has become a hot property

Continental Airlines' Chief Executive Officer Robert Ferguson said Wednesday he never expected to be so popular when, hurting for cash in the midst of an air fare war, the carrier went searching for investors.

Now, with two bidders increasing their offers and two others asking for time to revise their proposals, Ferguson said, "It's nice to be wanted."

"Like Captain Ahab, we went out fishing. It turned out instead of being Captain Ahab, we were the bait. And in that regard, we've been reasonably successful in attracting some fish," Ferguson said during a lunch for the Greater Houston Partnership's Aviation Committee Forum.

Four bids have been formally accepted for consideration by the Houston carrier, which is in the midst of bankruptcy reorganization. A fifth bid for $425-million submitted last week is still in a preliminary review.

Continental said Tuesday the board would decide Nov. 9 which investor it wants. U.S. Bankruptcy Judge Helen Balick, who has the final say, gave Continental until Nov. 16 to file its reorganization plan.

Ms. Balick said Tuesday she expects Continental to ask for yet another extension, and said she likely would grant one.

Ferguson conceded Wednesday that sometimes "it takes a little longer. But we're going to try to do it in record time."

He said he did not know which bidder would emerge the winner, but he said it won't necessarily be the highest offer. The board, he said, will try to pick the proposal that is best for Continental's future.

The bids suggest various strategic paths the airline could take. Continental could link with Mexican, Canadian or European airlines, depending on which investor wins.

Aeromexico has joined a group led by corporate raider Charles Hurwitz, chairman of Maxxam Inc., a Houston-based conglomerate, helping it increase its original bid of $350-million to $400-million.

Air Canada and a group led by a pair of Fort Worth investors also has increased its bid by $25-million to $425-million.

An investor group called Houston Air Inc., which offered $385-million, and Los Angeles investor Marvin Davis and Lufthansa German Airlines, which offered $400-million, have asked to revise their bids.

Ferguson said that during a board meeting Monday, Scandinavian Air Systems participated in Houston Air's presentation even though SAS later denied it has joined that group.

Besides picking a winning bid, only a few remaining issues have yet to be resolved with unsecured creditors, but none is major, he said.