NEW YORK (AP) - Billionaire hotelier Jay Pritzker and other suitors
formally have submitted bids for strikebound Eastern Airlines, but
the carrier remained locked Friday on its planned course of cutting
operations and selling $1.8 billion in assets.
Another potential buyer surfaced Friday, with the release of a
statement purportedly from a group of New York financial
institutions indicating they were prepared to pay $1 billion for
Eastern - but only if the deal included assets sold by the airline
since its 1986 acquisition by Texas Air Corp.
However, a representative of the group later denied reports that
the consortium actually had submitted a bid to the U.S. Bankruptcy
Court and to Eastern's bankruptcy examiner. Harry Gotimer, an
attorney representing the group, said a news release to that effect
had been issued prematurely and the consortium still was formulating
a proposal that had not been finalized.
Pritzker, the chairman of Hyatt Corp., informally offered around
$500 million for Miami-based Eastern several weeks ago, according to
sources close to the situation.
Jack Bavis, the head of Eastern's pilots union, told his
membership late Thursday that Pritzker submitted a bid Wednesday to
federal bankruptcy court, Eastern boss Frank Lorenzo, the airline's
unions and major creditors.
Bavis also said Trans World Airlines Chairman Carl C. Icahn has
requested confidential financial data on Eastern as a prelude to
making an offer for the nation's seventh-largest carrier.
The statement from the consortium of New York financial
institutions said the group had submitted an offer to the bankruptcy
court and examiner David Shapiro that would provide more than $1
billion for ``acquisition and startup costs for Eastern Airlines and
additional unspecified assets.''
The brief gave few details and Shapiro did not immediately
return a call seeking confirmation of the proposal.
Gotimer said in a telephone interview that ``we represent a
group that is seeking to put together a bid eventually.'' He would
not identify any of the principals but said the group was still in
the initial stages of creating its bid.
The statement said the offer would give the unions a substantial
equity stake in Eastern with equivalent representation on the board
of directors. The consortium would provide more than $500 million in
working capital to fund the first six months of operation under the
plan, the statement said. …