United Airlines deferred two debt payments worth a combined $875 million Monday, calling its strategy of reliance on grace periods "prudent" in light of current financial straits. Both payments now will be due later this month. But the US's second-largest carrier is pinning hopes of avoiding bankruptcy on Thursday's second vote by its mechanics union on a wage-cut proposal that, if ratified, could help United win a $1.8 billion federal loan guarantee.
Boeing's unionized engineers and technical workers OK'd new contracts covering 17,500 people in Washington state, with a proposal for 1,300 more engineers in Wichita, Kan., scheduled for a vote today. The three-year contracts call for an increase in pay and pensions, but also require workers to contribute more to their healthcare plans. Union leaders called the deal the best possible given the severe airline industry problems, which have led to a slump in orders and thousands of layoffs at the aerospace giant.
The 23-month, $5.6 billion effort to keep control of rival Legrande SA was abandoned by Schneider Electric, a leader in building automated control systems. The company said it would sell Legrande at a $2 billion loss to a consortium of venture capitalists led by Kohlberg Kravis Roberts of the US. Schneider's January 2001 acquisition of Legrande was blocked by European Union regulators. But although an appeals court recently overturned that ruling, Legrande then won another legal battle to stop Schneider from selling some of its assets to help satisfy EU competition rules. Both companies are French.
The world's largest supplier of office products, Buhrmann NV, said it will cut 1,100 jobs and take an $85 million after-tax charge because of continuing low demand. The company, based in Amsterdam, the Netherlands, sells business forms, copier paper, toner cartridges, software, diskettes, customized corporate giftware, and furniture.