August 23, 2004
UNITED
AIRLINES
UAL, Creditors Agree to
30-day Extension
United Airlines on Friday said
it has agreed with its creditors' committee to a 30-day extension,
subject to court approval, of the period during which it can exclusively
file a bankruptcy reorganization plan, Reuters reported. The agreed
extension is shorter than a recent request for a four-month extension by
the airline, a unit of UAL Corp. At a Friday court hearing, United's
bankruptcy attorney, James Sprayregen said United
agreed not to seek final approval of any business plan during those 30
days. The creditors' committee agreed not to press any alternative
restructuring strategies of its own during the period. United said its
CEO, Glenn Tilton, has pledged to include creditors in the company's
reorganization, the newswire reported.
U.S. Trade Group Says UAL
Pension Plan Termination Troubling
A trade group says a
termination of United Airlines retirement plans would send a 'very bad
message' to the rest of the pension system, while a
U.S. lawmaker
reiterated pension laws must be reformed. James Klein, president
of the American Benefits Council, said a filing by the carrier that it
will likely terminate its plans is a troubling development.
United's parent, UAL Corp., said in a court filing that it likely will
terminate its pension plans in order to become a viable business and it
defended its decision to stop funding the plans.
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United
Airlines
U.K. Ground
Staff Sets 24-Hour Strike for Aug. 27
U.K. Ground
Staff Sets 24-Hour Strike for Aug. 27
Heathrow Airport-based ground
staff for UAL Corp.'s United Airlines plans to strike for 24 hours on
Aug. 27 in a pay dispute, the Transport & General Workers'
Union said Friday. The move follows a
vote by T&G members in favor of strike action. The T&G says it
represents about 700 of United's ground staff at Heathrow, including
baggage handlers and check-in staff, with about 70% taking part in the
strike ballot. 'The vote for strike action was overwhelming with
93 percent support,' said T&G regional industrial organizer Jo
Jacques in a statement.
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US Airways
Asks Pilots for Pay Cut
US Airways,
struggling to avoid a second bankruptcy, has asked pilots for a 16.5
percent pay cut, USA Today reported in its Friday editions.
The
airline would give pilots the opportunity to recoup some of their
salaries by flying more, the paper said, citing a copy of the proposal
it had obtained.
US
Airways also told union leaders that wage and benefit negotiations must
end on Friday so employees can vote on proposals no later than Sept. 8,
USA Today said. The company has said it needs to find $1.5
billion in cost cuts by summer's end to avoid its second chapter 11
filing in two years.
Lord Says Second
Bankruptcy Part of Its Plan to Be Sold
Textile company Galey Lord
Inc. filed for bankruptcy protection for a second time on Thursday,
saying the move is part of its plan to be acquired by a New York-based
investment firm, the Associated Press reported. Last month, the
company's board of directors agreed to an out-of-court buyout by
investment firm Patriarch Partners LLC. Financial terms were not
disclosed. The buyout proposal did not win the unanimous approval of the
lenders, which was required for the acquisition to go forward. On
Thursday, Galey & Lord said a new agreement amends the proposal
Patriarch made last month.
Skilling Seeks Trial
Separate From Lay
Enron founder Kenneth Lay
doesn't want to go to trial alongside his one-time protege, former CEO
Jeffrey Skilling, the Associated Press reported. The feeling is mutual.
Both are arguing that allegations against them thinly overlap, if at
all, so they should be tried separately. Skilling's lawyers say 'the
addition of Lay to the indictment has only heightened the risk that even
the most conscientious, well-instructed jurors will be unable to
'compartmentalize the evidence' as it relates to Skilling and
Lay.'
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Kmart to Sell 18 Stores to
Home Depot for $271 Million
Retailer Kmart Holdings Corp.
today finalized a deal to sell 18 of its stores to Home Depot Inc. for
$271 million, Reuters reported. The original pact called for the sale of
as many as 24 stores for up to $365 million, but the deal was revised
earlier this month because of certain conditions not being met with
regard to some stores. Kmart said it expects proceeds of $259 million
for 17 of the stores to be released from escrow by the end of the
current fiscal quarter, including $54.6 million received last quarter.
It expects to receive the remaining sales proceeds during the fourth
quarter, it said.
Friedmans Lenders Agree to
Restructure Credit Terms
Friedmans Inc. on Friday said
its lenders have agreed to restructure their existing credit facilities,
totaling $135 million, with the company, Reuters reported. The company
has been fraught with federal probes into possible fraud and a series of
recent management changes.