New United Continental chief moves to calm investors, employees
By Alwyn Scott and Nick Carey
(Reuters) - One day after ousting its chief executive, United Continental Holdings Inc (UAL.N: Quote) and its new boss, Oscar Munoz, moved to reassure shareholders and employees that the company is stable.
The airline also got a boost on Wednesday after acting Chief Financial Officer Gerry Laderman said at an investor conference that United is on track to save $1 billion in annual non-fuel costs by next year and would complete a $1 billion share buyback nearly two years ahead of schedule. UAL told investors it would return $4 billion to shareholders by 2017.
Analysts gave a thumbs up to leadership change, and the company's shares rose, after falling as much as 2 percent in extended trading Tuesday. UAL shares closed slightly higher as broader indexes fell by more than 1 percent.
The stock slumped Tuesday after the airline surprised investors with the announcement that Chief Executive Jeff Smisek
and two other senior executives were leaving the company in connection with a federal probe involving the Port Authority of New York and New Jersey.
In February, the carrier said it had opened an internal investigation into its relationship with David Samson, a former chairman of the Port Authority of New York and New Jersey, after it learned of a federal probe.
Media reports have said the probe focuses on whether United added direct flights to Columbia, South Carolina, from Newark to accommodate Samson, who has a home near the city. A spokeswoman for Samson's lawyers declined to comment.
The route was canceled after Samson resigned in early 2014 following news of a separate federal probe into the potential conflict of interest between his role as port authority chairman and his private law firm. Continued...