Continental Airlines Inc., which had been talking to American Airlines Inc. and British Airways about joining their Oneworld alliance, announced Thursday that it will join the Star Alliance and develop stronger ties with United Airlines Inc. instead.

Continental was expected to change its membership on global alliances after Northwest Airlines Inc. and Delta Air Lines Inc. announced in April they intended to merge. Northwest and Delta are two major members of SkyTeam, as is Continental.

Continental had rejected overtures from United for a merger, but said at the time that it was reviewing its alliances. British Airways and American both confirmed that they were talking to Continental.

But soon afterward, reports surfaced that Continental and United were discussing closer ties, and those rumors grew louder after United decided it didn't want to pursue a merger with another major carrier, US Airways Inc.

"Continental's plan to partner with United and join the Star Alliance will provide substantial new opportunities for all of our customers," Continental chairman and chief executive officer Larry Kellner said in the joint announcement Thursday.

"In a network business, there is significant value gained from linking with larger networks to provide truly national coverage and expanded global reach, and exploring new ways to reduce costs and improve efficiencies," he said.

"As we experience some of the most challenging conditions airlines have ever faced, we look forward to the benefits of a new relationship with United and the other Star Alliance members," Mr. Kellner said.

United chairman, president and CEO Glenn Tilton said the two airlines looked for opportunities to create a unique and competitive partnership extending well beyond a traditional code share agreement."

He said Continental "will bring significant new assets to our global alliance, and our two companies will work together effectively with our partners to provide the best overall network in America and the world."

The change will leave Northwest and Delta in SkyTeam with major partners Air France, KLM and others; Continental with United, US Airways, Lufthansa and others in the Star Alliance; and American as the only major U.S. airline in the Oneworld alliance, which includes British Airways and other international carriers.

British Airways and American have discussed a new application for antitrust immunity for their alliance so that they can set fares jointly and share revenues on their North Atlantic routes as well as deepen their cooperation in other ways. Two previous tries were abandoned after the carriers didn't like the conditions placed on them by government regulators.