Continental Scuttles Merger With United

DALLAS — Continental Airlines Inc. said yesterday it would not pursue a combination with another carrier right away, a surprising move after weeks of growing speculation that it would join with United Airlines to create the world's biggest airline.

The chairman and chief executive, Lawrence Kellner, said in a message to employees that the Houston-based airline was better off alone than merging.

"We have significant cultural, operational and financial strengths compared to the rest of the industry, and we want to protect and enhance those strengths — which we believe would be placed at risk in a merger with another carrier in today's environment," Mr. Kellner told employees.