MIAMI — In a last-ditch move to block the sale of Eastern Airlines to Texas Air Corp., union leaders today offered the troubled carrier's stockholders a $600-million cash buyout proposal on behalf of Eastern employees.
Charles Bryan, leader of Eastern's machinists union, hand-carried the proposal to Eastern headquarters at 9:40 a.m. today.
"We received a communication from the coalition, and this will be brought to the board's attention," Eastern spokesman Jerry Cosley said. "There has been no development that would alter Eastern's firm expectation that the merger with Texas Air Corp. will go forward as planned with the affirmative vote of the stockholders."
Bryan said the employee coalition is offering $10.25 cash for each share of Eastern common stock, a total $600-million deal. That contrasts, he said, with a per share offer by Texas Air Chairman Frank A. Lorenzo of $6.25 cash, plus $3.75 in deferred payments--a total package worth $676 million.
The total union offer amounts to less than Lorenzo's because it does not include 10.9 million shares that it claims were improperly issued by Eastern after employees received 25% of Eastern stock in a concessions deal.
Later today, Eastern employees filed a lawsuit in federal district court to block the proposed merger with Texas Air. The suit charged that the merger would "preclude other potential bidders from competing on a fair and equal basis for control of Eastern."