Friday, February 27, 2004

Business digest



More stockholders line up against Eisner

LOS ANGELES - The pressure on Disney's board increased Thursday as more large pension funds said they would follow the lead of the nation's largest such fund in not voting to re-elect chairman and chief executive Michael Eisner.

As a sign of how serious the Walt Disney Co. is taking the votes, Eisner, along with Robert Matschullat, chairman of Disney's audit committee, flew Thursday to Columbus, Ohio, to discuss the concerns of officials from five state pension funds.

Public pension funds in California, New York, Connecticut, Massachusetts and New Jersey all said Thursday they would withhold their votes from Eisner at the March 3 shareholder meeting.

The California Public Employees' Retirement System has said it wants Eisner out.

Ohio's five pension funds will make their decision by Monday, a spokeswoman said. The state's main retirement fund controls 4.6 million Disney shares.

Judge blasts Hollinger owner, blocks sale

NEW YORK - A Delaware judge on Thursday blocked Conrad Black's plan to sell control of his publishing empire, Hollinger International Inc., to the Barclay brothers of Britain, saying Black consistently breached his duties to the company.

Judge Leo Strine of Delaware's Chancery Court added that Black's conduct "threatens grave injury" to Hollinger International and its stockholders. The judge threw out Black's attempts to change the bylaws of Hollinger International in a way that would have tightened his control of the board of directors. Black, who renounced his Canadian citizenship to accept the title of Lord Black of Crossharbour in England, frequently defended his claim to run the company he founded the way he saw fit.

Ex-Tyco officer ends nine days of testimony

NEW YORK - Defense lawyers for Tyco International's former chief financial officer Mark Swartz rested Thursday after nine days of testimony from their client, who is accused of participating in a $600 million looting of the company.

Prosecutors said they would launch a rebuttal case.

Japanese search Tokyo office of Microsoft

TOKYO - Officials from Japan's fair trade watchdog raided the Japanese unit of Microsoft Corp. on Thursday on suspicion of anti-monopoly law violations.

Microsoft confirmed that the Fair Trade Commission inspected the Tokyo headquarters office but denied any wrongdoing.

A commission official said Microsoft Japan is suspected of attaching improper restrictive conditions - such as requiring that Japanese computer makers reveal proprietary information that would infringe on patents - when signing software deals.

Microsoft said it had last week told computer makers - including companies in Japan - about plans to drop the patent-related provision when new contracts are signed later this year.

Thirty-year mortgage rate stable this week

WASHINGTON - Rates on benchmark 30-year mortgages held steady at a seven-month low this week. The average rate on 30-year, fixed-rate mortgages was 5.58 percent, unchanged from the previous week, Freddie Mac reported Thursday.

For 15-year, fixed-rate mortgages, rates rose to 4.89 percent this week, from 4.87 percent last week.

Jury ready to hear Adelphia fraud case

NEW YORK - A jury of three men and nine women was chosen Thursday to hear the fraud case against Adelphia Communications Corp. founder John Rigas and two sons, who are accused of using the company as their "personal piggy bank."

Defendants have pleaded not guilty to charges of conspiracy, securities fraud and bank fraud.

J.C. Penney confirms intent to sell Eckerd

PLANO, Texas - Confirming one of the worst-kept secrets in retailing, J.C. Penney Co. said Thursday that it is negotiating to sell its troubled Eckerd drugstore chain, and the impending sale dragged the retailer to a $1.07 billion loss in its fourth fiscal quarter.

But the retailer said its earnings from continuing operations were higher in the quarter and beat analysts' expectations. Penney shares rose more than 4 percent.




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