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Teamsters Study Employee-Led Airline Buyouts

February 26, 1988|From Times Wire Services

MINNEAPOLIS — The Teamsters union considers employee-led buyouts of airlines and other companies as part of its "global strategy" but has no concrete buyout proposals, the president of the Teamsters airline division said Thursday.

William Genoese, responding to questions at a news conference, said the union was studying the possibility of leveraged buyouts or friendly takeovers of Pan American World Airways, Northwest Airlines and USAir.

But he characterized any employee-led buyouts as mere possibilities under the Teamsters' long-term strategy rather than as certainties.

Also, two investment bankers mentioned by Genoese said they were not working on any airline takeover proposals with the Teamsters.

Genoese said discussion of union-led buyouts was not a ploy, but he conceded that "the threat of it will help you in negotiations."

Several airline industry analysts said they don't believe that the Teamsters union is serious about attempting leveraged buyouts or friendly takeovers of the three carriers.

One industry source close to USAir, asking not to be identified, told Dow Jones that Genoese's comments prompted Salomon Bros. to contact USAir on Thursday and deny that it had discussed any takeovers with Genoese or the union.

"I think (Genoese's comments) are just a negotiating tactic and a way to put pressure on the companies," said Dean Witter analyst Mark Daugherty. "I don't take it too seriously."

Negotiations between Pan Am and the Teamsters Union, which represents 4,500 Pan Am ground employees in 14 cities, on $35 million in concessions broke down on Sunday.

Strike Deadline

Although the union had set a strike deadline for that night, its members have continued reporting to work. Genoese has said a strike remains possible and has threatened to disrupt Pan Am ground operations.

Pan Am has said it needed a total of about $540 million in concessions from all its unionized employees during the next three years to ensure its survival.

Northwest is negotiating with its flight attendants on a new contract an faces a midnight tonight, Eastern time, strike deadline. Genoese spoke at a news conference about the likelihood of a strike by Northwest attendants, who also are represented by the Teamsters.

"There's a 100% chance of a strike," Genoese said. "As far as I'm concerned we're on a collision course with Northwest Airlines to strike."

Airline spokesman Redmond Tyler said progress is being made on some major contract issues. The two sides have been meeting since Tuesday at Northwest's headquarters with the help of a federal mediator.

Senority wage scales, pensions and work rules are among the major issues under discussion in the dispute.

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