A320 EOW
Feb 28, 03, 11:58 am
http://biz.yahoo.com/djus/030228/1250000516_1.html
Dow Jones Business News
EDS Says US Airways Accepts Revised Services Contract
Friday February 28, 12:50 pm ET
By Gary McWilliams, Staff Reporter of The Wall Street Journal
HOUSTON -- Electronic Data Systems Corp. (NYSE:EDS - News) said US Airways Group accepted a revised computer-services contract that the airline operating company had previous threatened to cancel.
Terms of the revised deal weren't disclosed. US Airways said the agreement, one of about 7,000 it expects to continue, was filed late yesterday with the Alexandria, Va., court overseeing its court-ordered reorganization.
Under a 25-year contract signed in late 1997, EDS provides the airline with data processing and telecommunications services for reservations, ticketing, baggage tracking and flight and data security. The original agreement was valued at about $200 million a year.
US Airways, which has been operating under Chapter 11 bankruptcy court protection since August, had accused EDS of failing to honor the "most favored customer" clause in an outsourcing contract by providing better pricing and terms to AMR Corp.'s (AMR) American Airlines Inc.
A spokeswoman for EDS, based in Plano, Texas, said the company was pleased with the new agreement, and that it wouldn't affect its outlook for 2003. The company this week forecast profit would decline to between $1.80 and $2 a share this year compared with $2.28 a share last year.
In midday trading on the New York Stock Exchange (News - Websites), EDS shares were down 36 cents, or 2.3%, at $15.55.
-By Gary McWilliams, The Wall Street Journal; 713-547-9206
Dow Jones Business News
EDS Says US Airways Accepts Revised Services Contract
Friday February 28, 12:50 pm ET
By Gary McWilliams, Staff Reporter of The Wall Street Journal
HOUSTON -- Electronic Data Systems Corp. (NYSE:EDS - News) said US Airways Group accepted a revised computer-services contract that the airline operating company had previous threatened to cancel.
Terms of the revised deal weren't disclosed. US Airways said the agreement, one of about 7,000 it expects to continue, was filed late yesterday with the Alexandria, Va., court overseeing its court-ordered reorganization.
Under a 25-year contract signed in late 1997, EDS provides the airline with data processing and telecommunications services for reservations, ticketing, baggage tracking and flight and data security. The original agreement was valued at about $200 million a year.
US Airways, which has been operating under Chapter 11 bankruptcy court protection since August, had accused EDS of failing to honor the "most favored customer" clause in an outsourcing contract by providing better pricing and terms to AMR Corp.'s (AMR) American Airlines Inc.
A spokeswoman for EDS, based in Plano, Texas, said the company was pleased with the new agreement, and that it wouldn't affect its outlook for 2003. The company this week forecast profit would decline to between $1.80 and $2 a share this year compared with $2.28 a share last year.
In midday trading on the New York Stock Exchange (News - Websites), EDS shares were down 36 cents, or 2.3%, at $15.55.
-By Gary McWilliams, The Wall Street Journal; 713-547-9206