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August 18, 2006
name='1'>Court Allows Delta to Buy United's
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Route
A judge has cleared the
way for Delta Air Lines Inc. to purchase United Airlines Inc.’s
right to fly between
size='3'>New York
size='3'>London
that Delta can retain it after the company exits bankruptcy,
Portfolio Media
reported yesterday. Judge
size='3'>Adlai Hardin gave the green light to
the $21 million deal Tuesday in the U.S. Bankruptcy Court for the
Southern District of New York. Under the deal with United, Delta will
put down $13 million initially. If the U.S. Department of Transportation
(DOT) grants the route transfer, Delta will then pay $2 million annually
for the next four years. The carrier plans to offer its first daily
round-trip between
size='3'>New York
size='3'>John
face='Times New Roman' size='3'>F.
w:st='on'>
size='3'>Kennedy
face='Times New Roman' size='3'>International
size='3'>Airport
size='3'>London
size='3'>Gatwick
face='Times New Roman'
size='3'>Airport
this year and intends to tack on a second flight starting in spring
2007. The carrier also is aiming to serve
w:st='on'>
size='3'>London
size='3'>Heathrow
face='Times New Roman'
size='3'>Airport
size='3'>.
Autos
name='2'>UAW Finds Little Progress Being Made in
w:st='on'>
size='3'>Delphi
Negotiations
The United Auto Workers
Union said that little progress has been made in reaching a
settlement with Delphi Corp. after a hearing on
w:st='on'>
size='3'>Delphi
aside its existing labor contracts was again pushed back until Sept. 18,
Agence France Presse reported yesterday.While
the union has argued that contract changes are unnecessary now that more
than 12,000 union members employed by the company have agreed to
retire,
size='3'>Delphi
with its current cost structure. The bankrupt automotive supplier
reported that its $2.3 billion loss in the second quarter was due in
large part to a one-time charge of $1.5 billion for pensions and
post-employment benefits such as health care.
href='http://news.yahoo.com/s/afp/20060817/bs_afp/usautogmlabordelphi_0608172…'>Read
more.
name='3'>Ford Studies More Plant Closures, Salaried-Job
Cuts
Ford Motor Co. is looking
to close more factories and cut salaried jobs and benefits by 10 to 30
percent, the Wall Street
Journal reported today. If implemented, the
moves would be in addition to company's “Way Forward”
restructuring plan, which is calling for cutting North American
white-collar salary costs by 10 percent by the end of 2006's first
quarter and closing 14 plants by 2012.
size='3'>The
face='Times New Roman' size='3'>Dearborn
size='3'>,
size='3'>Mich.
could cut North American white-collar costs by about 30
percent that would encompass reductions in compensation and
benefits including pensions, as well as staffing. Ford said it first
plans to make white-collar cuts through attrition and voluntary
departures before looking to carry out the proposed layoffs. The company
has about 35,000 salaried workers in the United States.
href='http://online.wsj.com/article/SB115585466989738816.html?mod=home_whats_…'>Read
more . (Registration required.)
Judge
Delays Decision on Multibillion-Dollar Refco Settlement
A bankruptcy court judge
delayed a decision on a multibillion-dollar settlement aimed at paving
the way for Refco Inc. to exit bankruptcy proceedings, instructing the
company's warring customers and creditors to negotiate for one more
week, Dow Jones Newswires reported yesterday.
size='3'>The proposed settlement, which would distribute at least $2.3
billion to Refco's customers and creditors, triggered a bitter quarrel
over whether the assets were being fairly distributed. Bankruptcy
Judge
size='3'>Robert Drain said he would consider
the settlement at a hearing on Aug. 24, just ahead of a crucial Aug. 31
deadline the settlement's negotiators hadset for the agreement to be
implemented.
href='http://www.cattlenetwork.com/content.asp?contentid=60936'>Read
more .
name='5'>Winn-Dixie Asks for More Time to Attract Creditors to
Approve Plan
Southern supermarket
giant Winn-Dixie Stores Inc. has asked the presiding judge in its
chapter 11 proceedings to extend its plan deadline, hoping for
more time to woo creditors to accept its reorganization plan,
size='3'>Portfolio Media reported yesterday.
Winn-Dixie has requested an additional 60 days, which would give the
company until Oct. 31 to lobby for approval. Winn-Dixie Stores Inc.
received approval for its reorganization plan on Aug. 4 when
Judge Jerry
Funk of the U.S. Bankruptcy Court for the
Middle District of Florida signed off on its disclosure statement. The
grocery store chain is looking to emerge from chapter 11 later this
year.
name='6'>Commentary: Public Pensions Should Move to the
Defined-Contribution Model
Former SEC Chairman
Arthur Levitt's report last week on
w:st='on'>
Diego
scandal reveals the opportunities that exist at the state and local
level to tamper with public pension funds, according to an editorial in
today’s Wall
Street Journal. Levitt’s report tells of
'years of reckless and wrongful mismanagement' and draws explicit
analogies with Enron, HealthSouth and other recent scandals. As the
Levitt report details, the
w:st='on'>San
Diego
itself with $1.4 billion in unfunded pension liabilities for municipal
workers by systematically over-promising on benefits and short-changing
the fund on contributions. According to Wilshire Consulting, the problem
of underfunded public pensions stretches nationwide: More than 80
percent of public pension plans are currently underfunded. The long-term
solution is for government to follow the private sector and wean public
workers from the defined-benefit pension model to a defined-contribution
plan where an individual worker owns and controls their own
retirement investments.
href='http://online.wsj.com/article/SB115585985889438916.html?mod=hps_us_at_g…'>Read
more. (Registration required.)
size='3'>High-Performance Wheel-Maker Files for Chapter
11
Weld Wheel Industries, a
leading maker of high-performance automotive wheels, filed for chapter
11 protection, the Kansas City Star reported today. The
company reported that it lost $1.1 million in the first six months
of this year on net sales of $21.8 million. Court documents show Weld
Wheel’s assets at $31.6 million. The documents also stated that
Weld Wheel has reached an agreement to sell its assets to American
Racing Equipment Inc. in suburban
w:st='on'>Los
Angeles
will pay $17 million and assume various debt and lease obligations,
according to the documents. Weld Wheel has secured up to $20.5 million
in financing from its lender, PNC Bank, its biggest creditor.
href='http://www.kansascity.com/mld/kansascity/business/15300296.htm'>Read
more.
International
size='3'>Yukos Managers Are Now Targets of
Prosecutors
The Russian prosecutor
general’s office said Thursday that it was pursuing a criminal
investigation against Steven M. Theede and three other executives who
managed the Yukos oil company from outside Russia before it was declared
bankrupt, the New York
Times reported today. The office said it was
investigating the transfer of company assets into a Dutch foundation
controlled by the executives. The statement also named Bruce Misamore, a
former chief financial officer; David Godfrey, a former adviser; and Tim
Osborne, director of the holding company GML, formerly Menatep, which
owns a majority of Yukos stock. It is unlikely that the men, all of whom
live outside
w:st='on'>
size='3'>Russia
would be prosecuted in Russian courts or that they would be extradited
to this country. It was also reported that an
w:st='on'>
size='3'>Amsterdam
rejected a claim by a Russian bankruptcy receiver to manage the
considerable overseas holdings of Yukos.
href='http://www.nytimes.com/2006/08/18/business/worldbusiness/18yukos.html?p…'>Read
more.