Business

The two biggest airline deals of all time may never get off the ground. Developer Donald Trump last week withdrew his $7.5 billion bid for AMR, the parent company of American Airlines, because the firm's stock price had plunged far below his $120-a-share offer during Wall Street's anxiety attack over heavily leveraged deals (AMR closed at 70 7/8, down 27 3/4 for the week). AMR's board declared that the company is not for sale, but Trump said he might launch another bid at a lower price.

Meanwhile, the employee-management buyout bid for UAL, the parent company of United Airlines, lost a main backer. The UAL deal initially faltered on Oct. 13, helping trigger the stock-market plunge, when bankers balked at the financing arrangements. The buyout group lowered its offer from $6.75 billion to an estimated $5.62 billion, when British Airways suddenly said it would pull out of the deal. The British carrier had planned to provide $750 million for the buyout and to take a 15% ownership stake in UAL. But by week's end the United group said it had put together a revised buyout proposal that will be presented to the UAL board this week. British Airways may still be interested in joining the deal if the terms are attractive.