March 11, 2014 in Business

Business briefs: Takeoff, landing slots lucrative for American

From Wire Reports
 

DALLAS – American Airlines is getting more than $425 million from selling takeoff and landing rights, or slots, at New York’s LaGuardia Airport and Reagan National Airport outside Washington.

That price was disclosed Monday in comments filed in federal court in Washington by the U.S. Department of Justice.

The department said the value of those slots shows that it drove a hard bargain last year when it settled its antitrust lawsuit against the merger of American and US Airways. The airlines agreed to give up slots at LaGuardia and Reagan and gates at five other big airports.

Slots are controlled by the government at Reagan, LaGuardia and Kennedy airports in New York and Newark Liberty in Newark, N.J., making them valuable when they hit the market. A pair of slots is needed for each round-trip flight.

Pizza chain Sbarro files for bankruptcy again

MELVILLE, N.Y. – Sbarro LLC, the Melville-based pizza chain ubiquitous in mall food courts, filed Monday for bankruptcy protection for the second time in less than three years.

In a news release, Sbarro said the Chapter 11 filing is designed for a quick exit from bankruptcy as the company’s management embarks on a broader plan to reduce debt, which includes closing underperforming stores.

A group of lenders will provide $20 million in financing, and the reorganization will eliminate $140 million of debt, the company said. Priority lenders will receive majority ownership of the reorganized business.

In court filings with the Southern District of New York in Manhattan, Sbarro listed $100 million to $500 million in assets and liabilities.

Sbarro’s 600 franchisees, out of its 800 stores worldwide, will not be affected by the filing.

Ebay asks vote support in tussle with Icahn

SAN JOSE, Calif. – EBay is urging shareholders to support its directors and reject the pair put up by Carl Icahn.

The two sides traded barbs Monday in the latest round in the ongoing tussle between the e-commerce company and the activist investor who wants to split it in two.

Icahn and eBay began their dispute in January, when Icahn disclosed a less than 1 percent stake in the company.

He wants eBay to spin off its PayPal mobile commerce arm, which is growing revenue faster than the rest of the company. EBay, on the other hand, strongly believes PayPal should stay part of the company.

EBay Inc. said Monday its four directors up for re-election – CEO John Donahoe, company co-founder Fred Anderson, Intuit co-founder Scott Cook and former Agilent Technologies CEO Edward Barnholt – should be supported by shareholders.

Icahn has put forth two candidates for the board who are his employees and has urged shareholders to vote against eBay’s directors.

JetBlue, American drop mutual arrangements

NEW YORK – JetBlue Airways Corp. and American Airlines are ending a deal that allowed travelers to add connections to their itinerary on each other’s aircraft.

The termination of the interline sales agreement was effective Monday.

The companies also said they are ending a reciprocal frequent flier agreement. Travelers won’t earn miles or points when traveling on eligible routes run by the other airline beginning April 1.

All JetBlue TrueBlue points or American AAdvantage miles already accrued through the partnership will be credited to customers’ accounts and are not affected.


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