Delta to ally with Cheap Tickets

Delta Air Lines has obtained a warrant to purchase up to 7 percent of Honolulu-based Cheap Tickets Inc. and will begin offering more of its fares through the company.

Terms of the five-year sales and marketing alliance with the Internet seller of discounted travel were not disclosed yesterday.

Delta has sold seats through Cheap Tickets for more than a year, although it has had no stake in the company, Cheap Tickets spokeswoman Dawn Lyon said.

The warrant allows Delta to purchase 1.6 million shares of the company's common stock at a discount over the next five years. Delta can buy the shares at the average share price for the previous 10 days, a Cheap Tickets spokeswoman said.

Sam E. Galeotos, Cheap Tickets' president and chief executive and a former Delta manager, said the company was excited by the opportunities that the partnership presents.

"The alliance supports Delta's ongoing efforts to make our product available to a targeted customer base, like that of Cheap Tickets," said Lee Macenczak, Delta's senior vice president of sales and distribution.

The companies jointly will sell and distribute tickets for Delta through the Web site for Cheap Tickets and through call centers and stores.

Cheap Tickets has been negotiating with several airlines to expand the range of travel options it offers. Last month it said it would increase television and e-mail advertising in an effort to gain a larger share of the $23 billion online travel market in the United States.

Cheap Tickets, founded in 1986, says it offers more than 1 million discounted fares from 35 airlines, besides regular published fares.

Delta shares fell 30 cents yesterday on the New York Stock Exchange. Cheap Tickets gained 22 cents on the Nasdaq Stock Exchange.