JUSTICE OPPOSES QUICK GREYHOUND-TRAILWAYS MERGER
The Justice Department said it asked
the government to proceed cautiously on a plan allowing the
nation's two largest intercity bus companies to merge their
operations, a move one of the firms said may derail the deal.
    Justice's opposition to quick federal approval of a bid by
Greyhound Lines Inc to take immediate control Trailways Corp
prompted Greyhound to threaten -- in a brief filed with the
Interstate Commerce Commission (ICC) -- to drop the merger
plan.
    Greyhound officials told Reuters late today the company
hoped for ICC action on the merger by tomorrow.
    "Greyhound Lines will go forward with the transaction only
if it is permitted to assume immediate, unconditional control
of Trailways' operations and to integrate them with its
operations," Greyhound said in a filing with the ICC, the
federal regulatory agency which has the final say over mergers
of interstate bus companies.
    But Justice had said in an earlier filing with the ICC that
it wanted the agency to move slowly on the plan and to turn
down Greyhound's request to begin operating Trailways
immediately.
    "The department has just begun to receive relevant
information on Trailways' financial condition and is in the
process of assessing the correctness of the company's
allegations," acting Assistant Attorney General Charles Rule
said in comments submitted to the ICC.
    Greyhound announced June 19 that it wanted the ICC to let
it begin operating Trailways immediately while continuing to
evaluate the merger for possible antitrust problems.
    Greyhound said it would pay 80 mln dlrs for many of
Trailways' terminals, buses and garages.
    The two companies said in papers filed with the ICC that
Trailways "could collapse in a matter of days."
    They said Trailways owed suppliers more than six mln dlrs,
with another six mln dlrs due June 30.
    The suppliers, they said, could force Trailways into
bankruptcy "at any time."
    Trailways also owes a consortium of banks 76 mln dlrs, and
the consortium has threatened to call the loan if Trailways
fails to pay the interest due June 30, they said.
 Reuter
