The Miami Herald from Miami, Florida • 141

mwPjfSC3Meg4S nf M'glgjj ggjSggg Ito83g NYSE9D AmexIOD NASDAQOTC1 ID 1 A Tuesday April 26 1983 The Miami Herald 7D i Business Horn Lenders snagging Eastern wage pact? bittriag- By MARTIN MERZER Herald Business Writer 6-MONTH BILLS 3-MONTH BILLS Treasury bills 3 mon April 18 803 April 25 815 6 mon April 18 820 April 25 822 and Exchange Commission Eastern said its latest wage settlements with the machinists and other employe groups would force the company to borrow substantial sums and ease restrictions in existing loan agreements If the company fails to arrange the loans and modify the agreements it could be "unable to meets its obligations in June the report said Eastern already has borrowed at least $110 million of the $400 million it is authorized to borrow under a 1980 agreement with a group of banks But because of its large recent losses and heavy debt load Eastern must receive the approval before using the balance of the $400 million In the past Borman has quoted the banks as saying that they will not lend the company money to pay for salary increases cently won a 170-million contract settlement from the company after threatening a strike Bryan stressed Monday that his union was not renegotiating its hard-won pact with Eastern But he and company officials refused to detail the precise nature of the help being requested by the company Jim Ashlock a spokesman for Eastern confirmed that Borman and several top aides met with Bryan other IAM officials and officers of the union on Saturday was telling them about the situation we Ashlock said got to borrow money and the question is whether or not we can get it It the meeting was a state-of-the-nation deal We have to get them to realize that the situation is In a recent filing with the Securities Monday a company source said that the lenders recently practically an out-and-out rejection of lending any more money to pay for these But the source said the talks with the lenders were continuing and the company was exploring other unspecified options Eastern with about 14000 local employes is the largest corporate employer in South Florida Bryan said that he hoped all of 37600 employes would join whatever program emerges from the unions' talks with company officials think Eastern is definitely the best airline in the he said is the best managed and the best run airline in the country For us to be threatened by the bankers now is just totally wrong just not morally Eastern Airlines is having trouble arranging new loans to pay for its recent wage settlements and once again is seeking help from its unions company and union officials said Monday Eastern Chairman Frank Borman who will meet today with stockholders during the annual meeting in New York sought the help of top officials of the and unions during a meeting last Saturday in Atlanta was talking about all the employes trying to develop some kind of relationship to get a cohesiveness throughout said Charles Bryan a leader of the International Association of Machinists (IAM) The union which represents 13500 ground-based workers at Eastern re a a 21 a it Feb Mar Apr Wometco Source- Treatury Dept Allied cuts out Yields inch upward on US securities raises its defenses Front Herald Staff and Wire Reports Yields -on short-term Treasury securities increased slightly in auctions rising for the first time since last month officials said The government sold about $62 billion in new three-month T-bills at an average discount rate of 815 per cent up from the 803 per cent of last week In addition about $62 billion in six-month bills were sold at an average rate of 822 per cent up from 82 per cent The yields were the highest since the April 1 1 rates of 8165 for three-month bills and 8248 per cent for six-month bills Moves to make takeovers harder By MARTIN MERZER Herald Business Writer Companies SEAFIRST CORP agreed to a $400 million takeover by BankAmerica Corp The deal worked out by executives for both banks late last week required a change in Washington state law to allow an out-of-state bank to purchase more than 5 per cent of a Washington bank The buyout announcement Saturday night was coupled with the disclosure that Seafirst suffered a staggering net loss of $133 million in the first quarter of this year SEARS REPORTED record first quarter net Income of $1646 million That is up 130 per cent from $714 million in the first three months of 1982 Net income per share rose to 47 cents from 20 cents Revenue was up 73 per cent to $691 billion from $644 billion Chairman and Chief Executive Officer Edward Telling said the company expected the rest of the year to be profitable as the economy improves But he said income would not increase as fast during the remainder of 1983 as it did in the first quarter Stockholders of Wometco Enterprises Inc honored the memory of company founder Mitchell Wolfson on Monday and then approved several measures designed to protect his company from unfriendly takeovers The several hundred stockholders attending the leisure-time annual meeting heard Wolfson lauded as a pioneer in the communications industry and as a major force in South business and civic community Wolfson who founded Miami-based Wometco in 1925 died Jan 28 He was 82 and had been in failing health His career and accomplishments were reviewed in a 16-minute film that was shown to stockholders Monday feelings of happiness are somewhat muted today because the man who founded our company the man who determined the shape and more importantly the character of Wometco for almost 58 years is no longer with Elton Cary the new chairman told the shareholders Cary a son-in-law of Wolfson has agreed to step in as chairman while leaving day-to-day management of the firm to Van Myers the newly appointed president and chief executive officer From humble beginnings as the owner of a single movie theater in downtown Miami Wolfson expanded Wometco until it owned six television stations (including WTVJ-TV in South Florida) 100 movie theaters cable-television stations bottling plants the Miami Seaquarium the Key West Conch Train and other properties At the time of his death Wolfson was the largest stockholder in the company None of his children had shown an interest in direct management of the company Those factors led to numerous rumors concerning the sale or break-up of Wometco But the board sought and on Monday received stockholder approval of sever- By TOM ROSENTHAL Assoc rak'd Press Writer MORRIS TOWNSHIP NJ (AP) Allied Corp announced Monday its recent takeover of Ben-dix Corp has prompted a major restructuring and the elimination of executives' lucrative severance agreements known as "golden Edward Hennessy Jr chairman and chief executive officer said Allied will reorganize into five sectors headed by executive vice presidents because it grew into a $10 billion company with the Ben-dix merger Hennessy announced at the annual stockholders meeting here also that Allied will stop offering golden parachutes He said the move which will come by the end of year was a result of general feeling of the American to the practice However Hennessy said that only the 21 Allied officials who have the contracts will be affected and not those who headed Bendix prior to the Jan 31 takeover Those Bendix executives include William Agee chairman and chief executive officer who will resign June 1 estimated at $45 million generated considerable publicity when it was revealed at the time of the takeover Agee became president of Allied as part of the acquisition and then announced he would resign amounts to approximately $4 million over five years said Allied officials The executives receive the money if they are fired their duties are diminished or if they resign following an acquisition by another company Hennessy said Allied will not immediately name a replacement when Agee leaves his post as president hope within a couple of years to find a Hennessy said The main reason Allied reorganized its corporate structure from six staff departments to five separate sections was because of the rapid growth of the company and the acquisition of Bendix Hennessy said The five sectors are chemical oil and gas automotive aerospace and industrial and technology The operations staff department will be eliminated section by itself could stand in the Fortune 500 list at about Hennessy said Each section will have greater authority to make decisions he said a j-' late founder Mitchell Wolfson and new top executives Elton Cary top left and Van Myers right CORDIS third-quarter earnings hit record levels Despite continuing losses in the company's 50-per cent-owned joint venture with Dow Chemical Corp Cordis said net income for the quarter ended March 31 soared to $25 million or 85 cents a share up 114 per cent over the year ago period Sales jumped 28 per cent to $43 million share of loss for the quarter was $289000 or 9 cents a share down from $707000 or 28 cents a share in the year-ago quarter IBM RAISED its quarterly dividend to 95 cents a share from 86 cents It is the first increase in payout since the first quarter of 1979 The increase which was expected by Wall Street analysts is payable June 10 to shareholders of record May 11 IBM said In the first quarter of 1979 IBM raised its quarterly dividend to 86 cents a share from 72 cents common stock is one of the most widely held shares with about 6037 million shares currently outstanding al measures designed to make an unfriendly takeover more difficult Under the proposals approved Monday a bidder might be required to pay certain minimum prices for large blocks of stock stockholder action could occur only at shareholder meetings and Wometco could double the number of its common shares to a total of 40 million The Wolfson family and other directors still control at least 33 per cent of the stock All had vowed to vote in favor of the proposals a situation that virtually assured passage Along with making unfriendly takeovers more difficult the measures also tend to prevent one member of family from selling large blocks of stock at a higher price than is received by other family members During the meeting company officials Please turn to WOMETCO SD Trends Pan Am to trim Caribbean fares RESALES OF single-family houses hit a two-year high in March Sales rose a moderately strong 98 after declining in February a real estate trade group reported Prices reached a median of $69300 just under last record of $69400 The report said the March sales rate was up 452 per cent from last low sales point of the 1981-82 recession Sales have risen since last summer as home loan rates have come down late travel during the off-peak traditionally slow He said that combined with lower off-season hotel rates the fare reductions should make the Caribbean extremely attractive vacation NEW YORK (UPI) Pan American World Airways said Monday it would cut fares on flights to the Caribbean by up to 54 per cent in an effort to stimulate travel during the off-peak season Pan Am said the reductions apply to travel between 10 US cities and Antigua Barbados Port of Spain Montego Bay St Maarten Freeport and Nassau The US cities involved are Miami Orlando Tampa New York Boston Hartford Philadelphia Washington New Orleans and Houston Pan Am said the new fares are unrestricted with no advance purchase or minimum or maximum stay requirements The fares are good for travel through Dec 15 although basic fares will be slightly higher between July 1 and Aug 31 the airline said As examples Pan Am said the one-way fare between New York and Montego Bay will be cut 51 per cent to $129 Mondays through Thursdays from $261 On weekends the fare will be 43 per cent lower at $149 From New York to The Bahamas the fare will be $99 midweek down 54 per cent from $216 The weekend fare will be $119 Martin Shugrue senior vice president-marketing said experience with its $99 fare last winter that this type of fare reduction serves to stimu Other one-way fare examples include: Miami to Antigua $129 midweek a 36 per cent reduction from $202 Weekend fare will be $149 Tampa and Orlando to Antigua $159 midweek a 38 per cent savings from $222 Weekend fare will be $179 Boston to St Maarten $179 midweek 40 per cent off the previous $296 fare Weekend fare will be $199 MAJOR OIL COMPANIES reported earnings declines for the quarter Standard Oil Co (Indiana) said first-quarter profit fell 15 per cent from a year earlier and Union Oil Co of California reported a 24 per cent drop The smaller Ashland Oil Inc said it had a net loss of $145 million and Pennzoil Co reported a year-to-year profit gain of 35 per cent for the first quarter The chemical sector which combines Allied Chemical Co and Allied Fibers Plastics Co will be headed by Alan Belzer currently president of the fibers and plastics firm The oil and gas sector consists of Union Texas Petroleum subsidiary and will be headed by William Getz International Fed board ordered to produce Biscayne tape By DAN FESPERMAN and EMILY RUBIN Herald Business Writers and its largest shareholder Kaufman Broad Inc said have reason to believe that they stopped the tape and went off the record and certainly like to know what was Lowell Garrett and attorney for the bank board the federal agency that regulates savings and loan associations said allegation "is simply not true" If anlysis shows that the tape was stopped attorneys say file further action to determine what discussions were left off the record In related action Monday an attorney TAIWAN MAY OPEN its stock market to foreigners The nation is seeking to expand its international financial links through an ambitious program that also includes the establishment of an offshore banking center and a free trade zone The Money Line Florida prime mortgage rate 10-13 Florida prime rate 1054-11 13-week T-bills 815 13-week CDs 803 26-week T-bills 822 26-week CDs 859 for banks 884 for 1 54-year to less than 254-year CDs 95 Rate it for Banks pay one-quarter percentage point less The Bottom Line Radnor Corp a subsidiary of Sun Co has acquired Royal Atlanta Business Park in DeKalb County Ga from Royal Palm Beach Colony Inc of Miami Gannett Co said USA Today its national newspaper launched last September has topped one million circulation Cenvlll Investors declared a 2-for-l stock split for Biscayne said in court that he believes the bank board has already agreed to sell Biscayne to New York-based Citicorp my view already said Bruce Greer a lawyer for Biscayne Greer made his comments during a hearing on motion to postpone the trial that will decide the fate of the failed Spellman ruled against postponing the trial citing public interest in the case He scheduled the trial to begin Wednesday morning John Gunther an attorney for the bank board said in an interview that no decision on the acquisition of Biscayne has been made and that none will be made until late June after the bank board has analyzed all bids for the failed Bids are due at the Federal Home Loan Bank of Atlanta on May 13 Between March 17 and April 6 Kaufman chairman and attorneys met and corresponded with bank board staff members in the belief that negotiations were still in progress A tape recording expert will check for tampering in a batch of tapes made before the recent federal takeover of the insolvent Biscayne Federal Savings and Loan Association The Federal Home Loan Bank Board which took over Biscayne after declaring the insolvent on April 6 was ordered by US District Judge Eugene Spellman to hand over the tapes of its March 17 and April 6 meetings It was at the April 6 meeting that the bank board voted to declare Biscayne Federal insolvent The board then took over the failed and opened New Biscayne Federal Savings and Loan Association in its place attorneys contend however that the bank board actually made its decision earlier during off-the-record discussions that were kept off the tape recordings Peter Homer an attorney for Biscayne Setting the Bcsozd Straight Biscayne Federal Savings and Loan Association lost $43 million in March 1983 In the nine months ended March 31 Biscayne lost $29 8 million The losses were reported incorrectly in BusmessMonday Judge Eugene Spellman: scheduled trial for Wednesday i rt.