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California | BRIEFLY / AEROSPACE

TRW CEO Outlines Financial Program

April 14, 1999|Bloomberg News

TRW Inc. will suspend its share buyback program, cut capital spending by about 15% and sell assets to maintain its credit rating, Chief Executive Joseph Gorman said. The company expects cost savings of about $300 million from its recent acquisition of auto parts maker LucasVarity. That's more than the $200 million originally expected, Gorman said at an aviation industry conference. TRW, based in Cleveland, bought London-based LucasVarity for $6.6 billion in cash last month to strengthen its auto parts business. But that increased its debt to more than 80% of its total capital, from 54%. Gorman would not say which businesses would be sold. He expects the sales to raise about $1.5 billion after taxes. Gorman said an announcement will be made soon as to whether LucasVarity Chief Executive Victor Rice will remain with the combined company as a consultant. TRW stock closed up 13 cents at $43 on the NYSE.

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