UAL hires Aon to manage 401(k) stock fund

[P][SPAN class=headline][A href=http://biz.yahoo.com/rf/020930/airlines_ual_aon_2.html][FONT size=2]UAL hires Aon to manage 401(k) stock fund[/FONT][/A][/SPAN][/P]
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[P][SPAN class=headline]BTW...Isn''t this the same group that started to manage US Airways'' 401(k) just prior to Chap. 11?[/SPAN][/P]
 

novaqt

Senior
Aug 20, 2002
488
0
I think its very interesting to note and incestuous to say the least that Retirement Systems Associates (RSA) outbid AON to invest in USAirways. RSA is where Rono Dutta now works and was specifically hired because of his direct knowledge of the internal workings of USAirways. United Airlines now hires AON. What can we make of all this?
 
C

chipmunn

Guest
UAL has hired Chicago-based AON, the world's No. 2 insurance broker, and its unit, AON Fiduciary Counselors to manage company stock in its 401(k) retirement plans while the airline works on its Economic Recovery Plan (ERP) strategy.

AON ordered Fidelity Investments to begin selling US Airways stock without employee investor knowledge approximately one month prior to the bankruptcy filing. After the filing, those employees who still held the U stock in their 401(k) were informed that a portion of their stock had been sold and the proceeds were placed in their money market default account.

None of this activity was disclosed prior to the bankruptcy filing.

It appears this was a way for US Airways management to help the employees by having shares sold with the bankruptcy filing imminent. This could be UAL's strategy as well.

In regard to former UAL president Rono Dutta (who recently resigned from UAL when Glenn Tilton was appointed CEO) signing a consulting contract with RSA, in my opinion he was contacted to provide input into the US Airways DIP financing and equity plan sponsor agreement(s) because of his detailed understanding of US Airways. He also could have been retained to advise RSA on how to finance and complete a unique corporate transaction between US Airways, UAL, and the ATSB.

Chip