Staggered by huge losses in commercial real estate investments, Westinghouse Electric Corp. is contemplating selling some of its other businesses to raise cash.
In an interview published in the Wall Street Journal yesterday, Westinghouse Chairman Paul E. Lego said that his staff was "evaluating what the best price would be for a whole series of businesses."
The Pittsburgh-based electronics, nuclear power and broadcasting conglomerate wants to raise $900 million in the next few months to help out its troubled financial services subsidiary. But company officials and industry analysts said that they doubted Westinghouse would sell an important business such as the defense electronics unit based in Linthicum.
Instead, they predicted the company would raise the money by selling stock, receivables or less important businesses.
Paul Jones, a company spokesman, said yesterday that Westinghouse had tried and failed to sell many of its real estate holdings. Westinghouse has said $3 billion of its $4.7 billion real estate portfolio is in arrears.
Now, Mr. Jones said, the company might sell "assets not essential to long-term growth."
But none of the core businesses, including the electronics division, are for sale, he said.
Westinghouse considers the Maryland operations "a star performer," he said.
Industry analysts said that Westinghouse might have no choice but to sell some businesses. "Lenders are going to be very, very reluctant" to allow Westinghouse to borrow much more, so the company will have to find some other way to raise cash, said Albert Turner, who follows the company for investor clients of Chicago-based Duff & Phelps.
Consequently, "there is a lot of uncertainty about how they are going to raise the money,"he said.
Maureen P. Lentz, who follows Westinghouse's stock for Roulston & Co. in Cleveland, said that Westinghouse might sell some business lines because it can't sell its real estate for anything close to the amount it needs.
"They bought a lot of suburban hotels and motels," she said. "And big city hotels are going for a 40 to 50 percent discount."
As a result, Westinghouse might be trying to sell its furniture division, or a subsidiary that distributes electrical products, she said.
This month, Westinghouse announced a broad cost-cutting program, including 4,000 layoffs, and took a $1.7 billion charge to restructure its financial services unit.