Intends to ‘Protect Investment’ : Boeing Vows to Keep Hands off Allegis

Boeing said Thursday that it does not intend to become involved in the management of Allegis, in which it has a large new stake, but will “protect our investment” in the transportation services conglomerate.

The two companies announced Tuesday that airplane maker Boeing would sell 36 new airliners to Allegis’ United Airlines subsidiary for $2.1 billion and at the same time buy $700 million worth of Allegis notes that are convertible to common stock. The stock could be turned into a 15% equity stake in Allegis.

The two-paragraph Boeing statement Thursday said, in part: “We intend to protect our investment by relying on the terms of the financing agreement that guard against actions or events which could adversely impact the present financial strength of Allegis.”

Analysts said Thursday that Boeing appeared to be saying that it would not join any hostile takeover attempt for Allegis. According to a 200-page 8-K document that Allegis filed Thursday with the Securities and Exchange Commission, Boeing is prohibited from solicitation of proxies and from seeking to “advise, encourage or influence” or participate in any hostile move initiated by anyone against Allegis.

The financing aspect of the transaction has been viewed by analysts as an attempt by Allegis to thwart any unfriendly takeover, including one by United’s pilots, who have offered to buy United Airlines. However, the pilots said Thursday that Allegis’ deal with Boeing “does not deter us from pursuing” the purchase.

In its statement Boeing also said it is “pleased with the confidence shown in our products by this substantial order. In turn, the related financing reflects Boeing’s confidence in the management and long-term viability of Allegis.”

Boeing declined to elaborate on the statement other than to say that it was being made in response to “numerous inquiries.” A United spokesman said only that Boeing’s statement was “very positive.”