Business Digest

BUSINESS DIGEST

February 01, 2003

In the Region

US Airways wants to cut Airbus order, reduce fleet leases

US Airways Inc. plans to cut the number of planes it will buy from Airbus SAS and asked a bankruptcy judge in Arlington, Va., yesterday to let it cancel leases on up to 29 aircraft in its current fleet.

The seventh-largest U.S. airline, operating under bankruptcy protection from creditors, would receive 10 A330-200 aircraft and 19 A320s under the modified order instead of one A330-300 and 37 A320s under a previous contract.

If the lease-reduction motion is granted, US Airways could complete restructuring negotiations on its current fleet.

Companies holding leases on the 29 A320s and A319s include Philip Morris Capital Corp., Finova Capital Corp. and John Hancock Leasing Corp.

Allegheny Energy gains 5th extension on debt

Allegheny Energy Inc. yesterday got a fifth extension of waivers on credit agreements from lenders in its continuing efforts to restructure about $1.7 billion in debt.

The Hagerstown energy company has taken a beating since October, when two subsidiaries defaulted on several key credit agreements.

Since then, Allegheny has been negotiating with its lenders to avoid bankruptcy. The deadline for most of the waivers was Feb. 7.

Allegheny has repeatedly warned that if it cannot resolve its credit issues soon, it will be forced to file for Chapter 11 protection.

Mid-Atlantic Realty closes deal on $100 million credit

Mid-Atlantic Realty Trust said yesterday that it has closed a $100 million, three-year unsecured revolving credit agreement with a bank syndication led by Allfirst Bank.

The Lutherville trust, which develops and manages community shopping centers, has the option to increase the limit to $125 million and extend the term to four years, according to the agreement with Allfirst and five other banks.

The agreement replaces a $75 million facility, also with Allfirst Bank.

The new credit line will be used for acquisitions, development, redevelopment and general corporate purposes, the company said.

New Horizon Computer wins training pact at NSA

New Horizons Computer Learning Centers of Baltimore announced a three-year contract to provide technical training in computer software and information security to Defense Department personnel at the National Security Agency at Fort George G. Meade.

The company in recent weeks also won a major training contract with T. Rowe Price and an earlier pact to provide Windows 2000 training at NSA, it said.

Financial terms of the recent contracts were not disclosed, but New Horizons will add 20 instructors as a result, said General Manager Ravi Aggarwal.

Elsewhere

Avon is ending sales experiment at Penney stores

J.C. Penney Co. Inc. and Avon Products Inc. are terminating their partnership to sell an exclusive cosmetics line, ending the beauty company's much ballyhooed first attempt at selling at retail.

Penney said yesterday that the move to discontinue selling Avon's beComing line of cosmetics was part of an overall strategy to discontinue most of its cosmetics lines to concentrate on women's accessories.

The expanded accessories assortment will be in stores by Aug. 1, and the retailer said the category has been a key growth opportunity.

The world's leading direct seller of beauty products said late Thursday that the beComing line will be now sold through Avon's beauty advisors, who are independent sales representatives.

This column was compiled from reports by Sun staff writers, the Associated Press and Bloomberg News.

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