AMR Corporation (NYSE:AMR) announced a plan today to reduce its interest expense amid pressure from activist shareholders to improve its financial results. The plan calls for the American Airlines parent company to prepay $545 million in aircraft debt in the forth quarter and should cut annual interest expenses by $25 million, according to their press release.

"With our improving financial performance, we have bolstered our liquidity position and we have opportunistically strengthened our balance sheet by reducing debt," said Thomas W. Horton, Executive Vice President of Finance and Planning and Chief Financial Officer of AMR. "While we have more work to do, our recent decisions not only improve our balance sheet, but also reduce our interest burden going forward and give us more financial flexibility for the future."

This new plan supplements existing actions taken by the company in the first half of 2007, including debt prepayments, bond refinancings and the lowering of interest rates on a credit facility. Combined, these actions eliminated an incremental $27 million of annual net interest expense, in additional to the net interest expense savings from AMR's scheduled debt amortizations. In the end, the company expects its net interest expenses to be $130 million lower than its expenses for the same period in 2006.

Clearly, AMR is doing what it can to reduce its expenses and improve its balance sheet to help unlock value for shareholders. Shareholders also applauded the move as AMR stock rose over 10% during the past two days. In the end, this is great news that makes AMR a stock worth watching over the next few months!

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Furniture Brands International, Inc. (NYSE:FBN) shares rallied for a second day after Samson Holding revealed a business combination proposal that the company declined to pursue in a Schedule 13D filing with the SEC. Shareholders are clearly excited about the interest as shares jumped almost 30% yesterday and another 7% in early trading today.

"[We] presented a proposal to the Issuer in July this year with respect to a possible business combination transaction, which the Issuer declined to pursue," said Samson in a statement. "The Issuer is a major customer of Samson Holding and in a business that is complementary to the Reporting Persons’ businesses and/or investments."

The Samson group said that it "may consider various alternative courses of action and take any action deemed appropriate" including seeking to acquire control of the company or pursuing board representation. This hardliner stance is the main reason shares in the company have risen to greatly.

In the end, any business combination is great news for shareholders as it would mean a significant premium to the company's current market price. Obviously, shareholders are very interested in such a deal as the share price has spiked on the news while the company seems like it may be resistant. Overall, this is a great stock to watch as this situation unfolds!

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A large shareholder of Duckwall ALCO Stores Inc. (NDAQ:DUCK) recommended several strategic changes for the company in a recent telephone conversation with Chairman Warren Gfeller, according to a Schedule 13D/A filing with the SEC. Shareholders and analysts are hoping that this could be a turning point for the company.

Strongbow Capital, which owns 14.2 percent of the company, suggested that the company expand the size of the board by one member and create an executive committee of the board that would be authorized to exercise all powers and authority of the board in the management of the business.

The hedge fund suggested that this executive committee work to reduce average inventory levels, reduce SG&A expenses and reduce losses from shrinkage. Strongbow also recommended that its own representatives occupy the additional board seat and be appointed to the executive committee.

Shareholders are hoping that this move can help bring accountability back to management and help the retailer improve its balance sheet and cash positions. It will be interesting to see if the company agrees with Strongbow and implements these changes. If so, this is definitely a stock worth watching!

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