The auction of Aloha Airlines' cargo division has been extended until next week.

Yesterday, a leading bidder Saltchuk Resources Inc., the Seattle-based owner of Young Brothers/Hawaiian Tug & Barge, said it was dropping out after the airline unexpectedly raised the price to $20 million.

"Saltchuk elected not to increase its bid to enter the bidding at the new bidding threshold, nor to bid over the other qualifying bid and terminated its participation in the bidding process," the company said in a news release.

Aloha announced last month that it is selling its profitable cargo division after it shut down its passenger services operations and terminated 1,900 workers in the largest mass layoffs that the state has ever seen.

Saltchuk previously submitted a letter of intent to purchase the 300-employee cargo unit for $13 million.

A second prospective buyer, whose identity has not been disclosed, offered to pay $13.65 million, Saltchuk said.

Those offers do not include another $5 million in receivables that will be included in the final purchase price.

The delay will not affect the sale of Aloha's 1,100-employee contract services division, which provides customer service, baggage service, ticket agents and ramp agents here for carriers such as Japan Airlines and United Airlines.

On Monday, Aloha announced that it was selling its aviation services unit to Los Angeles-based Pacific Air Cargo for more than $2 million. That deal is subject to approval by the federal bankruptcy court, which will hold a hearing today.