United Airlines is preparing for bankruptcy after the US government rejected its loan guarantee request.
Some experts called it the best thing that could happen to a carrier hamstrung by difficult labour relations and huge losses.
The New York Stock Exchange said it was halting trading in the stock ahead of expected news. The airline said it had no plans to issue a news release.
Shares of its parent, UAL, opened 59 per cent lower at $1.28 before trading in the stock was halted. Bond prices also sank on expectations that unsecured creditors will recover little of their money.
Bankers, lawyers and consultants were preparing documents for the second-largest US airline to make a weekend filing under Chapter 11 of the US bankruptcy code, sources said.
The US airline industry has been hit by its worst financial crisis since the September 11th, 2001, hijack attacks on New York and Washington. United posted the biggest annual loss in airline history in 2001, at over $2 billion, and is losing some $8 million a day.
US Airways, based in Arlington, Virginia, filed for bankruptcy in August.