Wednesday, February 25, 2004

Business Digest



U.S. unit of Parmalat files for Chapter 11

TRENTON, N.J. - Parmalat USA Corp., the U.S. subsidiary of fraud-ridden dairy giant Parmalat Finanziaria, on Tuesday filed for bankruptcy reorganization protection, saying it needs to obtain financing quickly but will continue operating normally.

During the Chapter 11 reorganization, Parmalat USA managers will work with a financial adviser on long-term solutions, which include the possible sale of its U.S. dairy business, the company said.

Bush has plans to reappoint Greenspan

WASHINGTON - President Bush intends to appoint Federal Reserve Chairman Alan Greenspan to a new term, White House spokeswoman Claire Buchan said as the expiration of Greenspan's term draws nearer.

The Fed chairman turns 78 in March, and his fourth four-year term as chairman expires June 20. "The president has always made clear he intends to reappoint him," Buchan said. "His term isn't up for several months. It will be dealt with down the road." The Senate must confirm the appointment.

Last year at this time, Greenspan created a political firestorm when he said: "I am not one of those who is convinced that stimulus is desirable at this point." The statement was viewed as a direct challenge to President Bush's $1.7 trillion tax cut package.

De Beers 'hopeful' of antitrust settlement

De Beers, the world's largest diamond company, said it is "hopeful" it can resolve a dispute with U.S. antitrust authorities that has prevented the company from operating in the biggest diamond market for more than 50 years.

"We are hopeful of a settlement" with the U.S. Justice Department, said Lynette Hori, a spokeswoman for De Beers in London. She declined to comment on a Wall Street Journal report that said the company has started new talks with the department.

The South African company has operated only through intermediaries in the U.S. since shortly after World War II, when the Justice Department filed a lawsuit alleging De Beers fixed the price of industrial diamonds. Another criminal charge was filed in 1994.

Fired aide uninvolved with lottery contract

Gtech Holdings Corp., the world's biggest supplier of online lottery systems, said a Brazilian government aide who was fired amid a probe of campaign finance allegations wasn't involved in extending the company's contract in the country.

Waldomiro Diniz met with two executives from the company's Brazilian unit last year to discuss a contract dispute with Caixa Economic Federal, a federal bank that runs Brazil's national lottery, Gtech spokesman Robert Vincent.

Gtech dealt with officials of the bank, Vincent said. Diniz, who oversaw the Rio de Janiero state lottery, had requested a meeting with Gtech about the dispute, though didn't participate in later discussions.

Tyco CFO: Loan was for home maintenance

NEW YORK - The former chief financial officer of Tyco International testified Tuesday that he received $8 million from the company to help him maintain residences in Florida, New York City and New Hampshire.

But the ex-CFO, Mark Swartz, 43, acknowledged there was no written document detailing what he described as a relocation "benefit" - a claim greeted with incredulity by prosecutor Marc Scholl.

"You're telling us there is this oral go-ahead that results in you getting $8 million?" Scholl asked.

"That is correct," Swartz replied during his seventh day of testimony in the lengthy trial, already into its fifth month.

AFL-CIO warns of grocery boycott

LOS ANGELES - Talks to resolve the grocery strike continued this week, marking two weeks of continuous negotiations between union leaders and executives from Ralphs, Vons and Albertsons.

Meanwhile, a coalition of California labor leaders, clergy and health care advocates threatened a statewide boycott of Safeway Inc. - Vons' parent company - if the two sides do not come to a resolution.

"If negotiations are not productive, we will do what labor does best," said Art Pulaski of the California Labor Federation, AFL-CIO.

Enquirer news services




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Business Digest