America West Airlines Inc. said Wednesday it has submitted a proposal to buy Eastern Airlines' Northeast shuttle and 10 Boeing 757 planes for $726 million in a deal that would top an offer from developer Donald Trump.
The aggressive regional carrier based in Phoenix said it would pay $390 million cash for the shuttle. Eastern already has agreed to Trump's $365 million bid for the profitable Boston-New York-Washington shuttle, and 17 smaller, older Boeing 727s.However, all sales of Eastern assets must be approved by the federal bankruptcy court overseeing the airline's Chapter 11 reorganization.
America West said it submitted the proposal as part of Eastern's bankruptcy proceedings.
Bruce Nobles, president of Trump Shuttle - the name the developer plans to use for the shuttle - said, "We have no comment. We don't know anything about it," referring to the America West proposal.
However, he said, "We have a signed contract with Eastern."
Eastern filed for protection from creditors five days after its Machinists, pilots and flight attendants unions walked off the job March 4.
The airline began moving ahead with plans to sell $1.8 billion in assets and rebuild on a much smaller scale after attempts to sell the entire company collapsed.
U.S. Bankruptcy Judge Burton R. Lifland has pushed to have Eastern sold in its entirety and scheduled a hearing for arguments over why such an auction should not take place.
Billionaire hotel executive Jay Pritzker, former baseball commissioner Peter Ueberroth and takeover strategist Carl C. Icahn, who owns Trans World Airlines Inc., are among the investors who have expressed interest in Eastern at various points during the past two months.
America West has indicated its interest in buying Eastern's shuttle or other assets several times since the strike began.
As recently as April 28, America West Chairman Edward Beauvais said the company was interested in buying the shuttle if the sale to Trump fell through. Beauvais said then that America West had lined up tentative outside financing and was prepared to bid $600 million to $700 million for the shuttle and a number of aircraft.
America West is the nation's 10th largest carrier and serves 46 destinations throughout the United States and Canada.
The company turned a $45 million loss in 1987 into a profit of $9.4 million last year.