United Pilots Ask for Stock Sales Halt

November 6, 2002 (PLANSPONSOR.com) - The union representing United Airlines pilots said it has asked the adviser to the employee stock ownership plan (ESOP) to stop selling shares in United parent UAL Corp. and begin buying back shares already sold.

According to a Reuters news report, sale of UAL stock is not in ESOP members’ long-term best interest, the Air Line Pilots Association (ALPA) master executive council representing United pilots said in a letter to independent fiduciary State Street Bank & Trust.

State Street said recently that it may sell up to a fifth of the plan’s UAL shares, about 10.9 million, over the next 90 days.

United and its pilots have tentatively agreed to $2.2 billion in wage cuts over 5-1/2 years, and United on Tuesday said it has renegotiated $500 million in debt due later this year, significantly strengthening a bid for federal loan guarantees, ALPA said, according to the Reuters report.

UAL, the second-largest US airline behind American Airlines parent AMR Corp., is 55% owned by the pilots, machinists and salaried and management workers. Each group has a seat on the board of directors.