Pacific Says Cash Shortage Threatens Survival

Pacific Aerospace & Electronics Inc. said it may reduce its 1,100-member work force and stop selling some parts because of a cash shortage that threatens to put the electronics company out of business. If its performance doesn’t improve, it could default on its debt payments, the maker of aerospace, defense and medical components said in a filing with the Securities and Exchange Commission. The Wenatchee, Wash.-based company, whose customers include Boeing Co. and Nortel Networks Corp., said it may also sell excess inventory and cut administrative costs as it tries to restructure its debt. Pacific Aerospace said it took on significant debt to acquire Aeromet International in 1998 for about $70 million. Shares in Pacific Aerospace plunged 75 cents, or 43%, to close at $1 on Nasdaq. The shares have fallen 73% since March.