Former Chief of Continental Joins Ueberroth’s Team

NEW YORK —  The slate of airline executives being put together by Peter V. Ueberroth to run Eastern Airlines began to take shape Tuesday with the confirmation that he has recruited the highly regarded ex-president of Continental Airlines, Martin R. Shugrue Jr., to play a key role.

Shugrue left Continental--which is owned by the same company that owns Eastern--in February after reportedly being fired by Frank Lorenzo, the boss of parent Texas Air Corp. and the man negotiating the sale of Eastern to Ueberroth.

The exact role that Shugrue--who began his airline career as a pilot at Pan American World Airways in 1968 and became Pan Am’s chief operating officer--would play in the reorganized airline has not yet been defined.

“He is working with us. He is part of our group,” said J. Thomas Talbot, the Newport Beach real estate investor and former airline executive who is Ueberroth’s partner in the airline venture.

In a speech in Los Angeles over the weekend, Ueberroth said a number of airline executives were part of the group he is heading to take over the nearly idled carrier. On Tuesday, he confirmed that Shugrue, 48, was a member of the group.

“We think very highly of him,” said Ueberroth. “But no role has been spelled out for him.”

Shugrue, who was president of Continental for a year and who still has an office in Houston where Continental is headquartered, could not be reached.

He left Continental when Lorenzo brought in D. Joseph Corr, who had been president of Trans World Airlines, as president. Some observers said at the time that he had been fired by Lorenzo.

Edward Starkman, an analyst with Paine Webber, a New York investment company, said when Shugrue left Continental: “There are two kinds of people, those who get along with Frank Lorenzo and those who don’t, and I guess he fits in the latter category. I would guess he was not satisfied in his role.”

At Pan Am, where Shugrue started as a pilot and flight engineer on a Boeing 707, he moved into management but lost his job in early 1988 in a personnel shake-up at the financially ailing carrier. Analysts said he would be a valuable asset to Eastern.

“Marty would be well suited,” said Edmond Greenslet, an analyst with ESG Services of Cos Cob, Conn. “He has certainly had experience with troubled companies.”

Another name mentioned on Tuesday as part of the Ueberroth team was William R. Howard, who resigned in 1987 as head of Piedmont Airlines when it was acquired by USAir. He then became chairman and chief executive of Airline Acquisition Corp., the company formed by the pilots of United Airline to take over that company. Had they been successful, Howard would have headed the airline.

RELATED STORY: Part I, Page 1