Diamond Foods Inc. and Procter & Gamble Co. have called off their $1.5 billion deal for Diamond to buy the Pringles brand. Cereal maker Kellogg Co. is swooping and made a $2.7 billion deal to purchase the brand.United Airlines is ordering 50 new airplanes.
The deal announced Tuesday has several conservative pieces. United split its order between the Boeing 787 and the Airbus A350, and waited until the depth of a recession so it could press for better prices. No planes will be delivered until 2016, and United has extensive rights to defer the orders. Perhaps most important, United only has to come up with $152 million over the next five years, putting off the day it will need to line up loans for its new planes.
At list prices, the new jets would be worth more than $10 billion, with about $4 billion for Boeing’s 787-8 and about $6 billion for the Airbus planes. United President John Tague said the carrier got a discount, which is common for jet orders, though he didn’t specify how much.
“We felt that we had a significant opportunity by timing the order with the backdrop of the current economic environment,” he said.
The planes will replace Boeing 747 and 767s. Deliveries are expected between 2016 and 2019.
Both of the new aircraft models are made with composites, meant to be lighter (and thus more fuel-efficient) than the usual aluminum construction. Neither plane has ever flown. Boeing hopes its 787 will make its first flight by the end of this year, while Airbus is aiming to deliver its first A350 in 2013.
