Evasive Action

As they awaited a fateful meeting of Trans World Airlines' board of directors in Manhattan last week, former Ford Motor Chairman Ernest Breech and former U.S. Steel Chairman Irving S. Olds exuded confidence. Next day, Breech and five new directors were to be elected to TWA's board. This would pave the way for the election of Breech as TWA's new chairman and the naming of a president for the line, which has been without a captain since Charles Thomas resigned some six months ago. Best of all, after months of wrangling, they seemed to have bested their chief nemesis: eccentric, invisible (to TWA personnel) Howard Hughes.

A month before, banks and insurance companies from which TWA hoped to borrow $165 million for new planes had forced Hughes to turn over his 78% of TWA stock to a three-man trusteeship dominated by Breech and Olds. Hughes had even given his approval to the board's reorganization. "It's not that we're trying to match wits with Howard Hughes," said a banker when the trust was set up. "We've given that up long ago. We're just trying to plug up all the holes."

They did not succeed. Hughes called Breech at breakfast the day of last week's scheduled meeting and informed him that he no longer favored enlarging the board. But what could Hughes do, since Breech and Olds had stock control of TWA? When Breech and Olds got to the meeting, they found out. Tipped off by Hughesmen, most of Hughes's directors did not show up at the meeting. An embarrassed Breech and Olds could not even get a quorum, therefore could not get Breech elected to the board. Since the bylaws state that only the directors or a special stockholders' meeting can elect new directors, the two men who control TWA were forced to call a stockholders' meeting to approve their plans. That will not take place for at least another month--and no one knew what Howard Hughes might do in that time to further harass his foes.

This file is automatically generated by a robot program, so reader's discretion is required.