NEW YORK (AP) _ The three unions at Trans World Airlines said Wednesday they have formed a coalition to ″pursue alternatives″ to the $793.5 million takeover of TWA by Texas Air Corp.
The coalition said it had retained two investment bankers to help it block Texas Air from gaining control of TWA. The investment bankers are Eugene J. Keilin, a partner in the firm Lazard Freres & Co., and Brian M. Freeman, president of a firm that bears his name, it said.
Representatives on the coalition are Capt. Harry Hoglander, chairman of the TWA Pilots’ Master Executive Council within the Air Line Pilots Association; Vicki Frankovich, president of the Independent Federation of Flight Attendants; and William O’Driscoll, acting president and general chairman of the International Association of Machinists, it said.
On Tuesday, a group of TWA employees said 1,000 workers had responded positively to a survey asking the airline’s 29,000 employees if they were willing to take short-term wage reductions to finance an employee purchase of TWA.
The TWA Employees Committee said it mailed questionnaires to TWA’s employees before the Texas Air offer was announced June 11. The committee said it had the support of the pilots’ union.
The coalition announced Wednesday it would assume the activities of the buyout committee.
Asked what alternatives - other than an employee buyout - the coalition would explore, Frankovich said: ″I’m not in a position to release that at this point.″
The coalition possibly could pursue a leveraged buyout or seek a ″white knight″ to rescue TWA from Texas Air.
In a leveraed buyout, the target is acquired with borrowed funds that are paid off with the target’s operating earnings or through the sale of some or all of its assets.
On Tuesday, Jerome Laux, a spokesman for the TWA Employees Committee, said: ″If the employees can come up with an equal or better offer, the board of directors is obligated to send it out to the shareholders along with the one they’ve already approved. Since the (Texas Air-TWA) deal itself doesn’t close until December, we certanly have some time.″
Texas Air is the parent of Continental Airlines, which is in Chapter 11 reorganization proceedings, and New York Air.
TWA’s employees are worried about cost-cutting measures by Frank Lorenzo, Texas Air’s chief executive officer. Lorenzo canceled Continental’s union contracts after Continental began its Chapter 11 proceedings in September 1983 and sharply cut wages.
TWA agreed to be taken over by Texas Air to head off a hostile takeover bid by investor Carl C. Icahn of New York.
The proposed merger would create one of the nation’s largest airlines, with a fleet of 294 jets that would be second only to United Airlines’ 320.
The combined operation would employ 40,000 people and its 1984 revenue would have been $5.03 billion.