The U.S. Justice Department on Friday approved a merger between United Airlines and its rival Continental Airlines, a deal that would create the world's largest carrier.

A Continental Airlines sign is seen next to a United Airlines sign in Chicago's O'Hare International Airport May 3, 2010. The U.S. Justice Department on Friday approved a merger between United Airlines and its rival Continental Airlines, a deal that would create the world's largest carrier.

"The department has closed its investigation into the proposed merger of UAL Corporation, the parent of United, and Continental," the department said in a statement.

"The proposed merger would combine the airlines' largely complementary networks, which would result in overlap on a limited number of routes where United and Continental offer competing nonstop service," it said.

The Justice approval of the merger came one month after the European Commission gave it a green light.

The two airlines agreed to merge in May in an all-stock deal. Under the agreement, the holding company for the new entity will be named United Continental Holdings, Inc. and the name of the airline will be United Airlines with the marketing brand of a combination of the brands of both companies.

The new company's corporate and operational headquarters will be in Chicago and it will maintain a significant presence in Houston, which will be the combined company's largest hub.

Together, Continental and United serve more than 144 million passengers per year as they fly to 370 destinations in 59 countries.

United Airlines is a network airline providing domestic and international scheduled air passenger and cargo transport. It operates network hubs in Los Angeles, San Francisco, Denver, Washington and Chicago.

Continental Airlines is also a network airline providing domestic and international scheduled air passenger and cargo transport. It operates network hubs in Newark, Houston, Cleveland and Guam.

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