The move brings Continental’s total contribution this year to $269 million, satisfying funding requirements and boosting the pension assets to more than $1.1 billion. The airline is expected to contribute even more to the plan before the end of the year, according to a Dow Jones report.
With the contribution, the Houston-based airline will be cutting its stake in the regional jetliner to 31% from 44%. This comes after a canceled planned public offering of 5 million ExpressJet shares in July when the share price dipped below Continental’s target price. Continental had planned to contribute the cash raised from the offering to the pension fund. Instead, Continental simply contributed the shares themselves.
Jim Moody, spokesman for the Continental branch of the Air Line Pilots Association, said the union supports the move as the contribution shores up pension funding, rather than leaving the pension sorely underfunded. He said the union expects the airline to make additional contributions this year, even though a date or amount was not specified.
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