Northwest Pilots to Picket
Northwest Airlines pilots, unhappy with the slow pace of contract talks, intend to picket the airline’s hubs today in Detroit, Memphis and Minneapolis-St. Paul.
The protest comes as Los Angeles investor Alfred A. Checchi prepares to take control of the airline. A spokesman for Checchi said he plans to complete his $121-a-share tender offer for NWA Inc., the parent of Northwest Airlines, late today.
Negotiations between the Northwest unit of the Air Line Pilots Assn. and Northwest management were conducted Tuesday by Joshua Javits, chairman of the National Mediation Board. Javits entered the talks Monday after 28 months of negotiations broke down on Friday.
A spokesman for the 5,100 Northwest pilots said the two groups remain apart on key issues involving salary and job protection. The spokesman, Steve Arnold, said some progress was made during five hours of talks on Tuesday, and that the company was expected to present a revised contract proposal today.
“We’re hopeful,” Arnold said. The pilots said previously that if the stalemate continues, they would ask Javits to declare an impasse, a move that could eventually lead to a strike.
Checchi has steadfastly refused to get involved in the contract talks. A former Marriott Corp. treasurer, Checchi won a hotly contested bidding war for NWA a month ago with his $4-billion offer.
No Clearance From Department of Transportation
Checchi is expected to complete the transaction today, after the waiting period under the Hart-Scott-Rodino Antitrust Act expires. A spokesman for Checchi said the antitrust clearance was “the last impediment” to completing the deal.
Checchi still doesn’t have clearance from the U.S. Department of Transportation, which is conducting a financial review of Checchi’s plans for Northwest. Though the department can’t block Checchi’s bid outright, it can refuse to transfer Northwest’s certificate of operation to the new owner.
Transportation Secretary Samuel K. Skinner on Tuesday said the department expected to complete its review by Sept. 1. Skinner previously said he was concerned how additional debt related to Checchi’s leveraged buyout would affect the airline. Checchi’s plans call for borrowing $3.35 billion, although he said that he wouldn’t have to sell aircraft or valuable landing rights to finance the acquisition.
Despite the obstacles ahead, Checchi may have gained some momentum Tuesday. A federal judge in Bismarck, N.D., refused a request by the North Dakota attorney general to block the transaction. North Dakota claimed that the debt involved in the transaction could force Northwest to cut back on service to the state.
