United Looking for Way to Make Peace With Its Pilots
The chairman of United Airline’s parent company tried Thursday to make peace with the airline’s pilots, who have sought to purchase the carrier for $4.5 billion, even though he said the proposal has damaged the airline.
But Chairman Richard J. Ferris of UAL Inc. said at the company’s annual meeting that the pilots’ efforts to buy United, which UAL has formally rejected, had been taken “seriously.” Ferris, in his first public comment since the pilots expressed their intentions April 5, said they had never made a concrete offer--just a “proposal to negotiate.”
He conceded, however, that the pilots’ action had “put United into play,” making it vulnerable to a takeover attempt by somebody else. Meanwhile, it was reported Thursday that real estate investor Donald K. Trump has sold his stake in UAL Inc.--reportedly about 4.9% of the outstanding shares.
“We hope we can find a way to put peace back in the airline,” Ferris said at a news conference after the meeting.
Frederick C. Dubinsky, chairman of the United Airlines Pilots’ Master Executive Council, responded: “It is clear that Mr. Ferris and his board failed to recognize the pilots’ objective. We are committed to a business transaction designed to achieve 100% employee ownership of the airline and substantially enhanced shareholder value. Mr. Ferris’ attempt to treat our offer as a collective bargaining matter is a disingenuous ploy to divert attention from the board’s failure to fulfill its obligation to shareholders.”
Ferris said that the UAL board agrees with the “fundamental issue” presented by the pilots, “namely, employees in a service company can be best motivated and best rewarded when they can participate in the financial success of the company.” Without being specific, he said such concepts were being explored in current negotiations with the airline’s machinists and will be on the agenda when talks begin soon with the flight attendants’ union.
Separately, the shareholders voted in favor of a previously announced proposal to change the name of UAL Inc., which owns Hertz Rent a Car, Westin Hotels and Hilton International, as well as the airline, to Allegis Corp.
