Other items: Airline projects cuts if labor deal rejected; Software firm, Time Warner add partner; Finance chief quits; 15-day report delay ...
Paccar’s board said yesterday that former Boeing Chief Executive Harry Stonecipher resigned as a director at the Bellevue-based truck maker. Stonecipher had served on Paccar’s board since 2001.
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The resignation is effective immediately, Paccar said in a statement. Boeing said it ousted Stonecipher on March 7 because his conduct in an affair with an employee raised questions about his judgment and had the potential to embarrass Boeing.
Airline projects cuts if labor deal rejected
Continental Airlines would cancel new Boeing jet orders and shrink its fleet if unions representing pilots, flight attendants, mechanics and dispatchers don’t ratify new agreements for further cost savings by March 30, the carrier said yesterday in its annual regulatory filing.
Continental said it would sublease or sell 24 Boeing 737-500 aircraft, cancel plans to lease eight 737-300s, postpone accelerated 2006 delivery of six 737-800s to the original 2008 delivery dates, cancel orders for 10 787 aircraft, and discuss with Boeing deferral of all 40 remaining aircraft on order that are scheduled for delivery beyond 2005.
If the labor deals aren’t ratified, the airline said it would cut $300 million in salaries and benefits, and furlough workers.
Software firm, Time Warner add partner
Microsoft and Time Warner went ahead with a venture to buy ContentGuard, a U.S. maker of antipiracy software for Internet music and film distribution, after bringing in Thomson to sidestep a European investigation.
The European Commission, the European Union’s Brussels-based regulatory arm, has been investigating a plan by Microsoft and Time Warner to buy ContentGuard. Bringing Thomson into the venture means no company will have control and the deal is no longer subject to EU merger rules.
Finance chief quits; 15-day report delay
Onyx Software announced yesterday that its chief financial officer is resigning and the filing of its annual report will be delayed by up to 15 days, but the company said the events are unrelated.
Brian Henry is resigning for personal reasons and to pursue other interests, the company said. Henry will stay at least through mid-April and help finish the 2004 10-K report.
Onyx, a Bellevue producer of customer-relationship management software, requested more time to file the report, attributing the delay to its “limited internal and external resources” and new audit procedures.
Milestone payment in Genentech deal
Seattle Genetics said yesterday it will receive an undisclosed milestone payment for achieving one of the goals of its collaboration with Genentech.
The milestone was based on Genentech’s progress in animal testing with Seattle Genetics’ antibody-to-drug linking technology. The technology is designed to enable antibodies to carry potent drugs directly to cancer cells.
Compiled from Bloomberg News, The Associated Press and Seattle Times business staff
Nation and World
Toys R Us
Auction winnows bidders down to 2
The auction to acquire retailer Toys R Us has narrowed to two suitors that offered to buy both the struggling toy-store chain and the Babies R Us unit for more than $5.7 billion, sources familiar with the situation said yesterday.
Buyout firm Kohlberg Kravis Roberts and an investment group led by Cerberus Capital have submitted bids for the entire company, rather than only the toy-store chain, which was put up for sale last year, the sources said.
Toys R Us had planned to keep its faster-growing Babies R Us unit, which sells infant clothes, linens and furniture, but the last-minute takeover offers for the entire company were too lucrative to ignore, one of the sources said.
Toys R Us, which sources said is scheduled to have a board meeting later this week to review the offers, could not be immediately reached for comment. Cerberus and KKR declined to comment.
Lands’ End buyer reportedly sought
Sears may be working on one last big sale before its merger with Kmart: a sale of Lands’ End.
According to a report yesterday by Women’s Wear Daily, a respected retail-trade publication, Sears has put the casual-clothing manufacturer up for sale for $1.2 billion. That’s $700 million less than it paid three years ago for the Dodgeville, Wis.-based unit, which sells apparel through catalogs, about 30 retail and outlet locations and Sears department stores.
The report, citing unnamed sources, comes as Sears is in the final stages of being acquired by Kmart for $11 billion. The merger, announced in November, is expected to close shortly.
Forum quits group backing Bush plan
Another major Wall Street player has dropped out of a business coalition that supports President Bush’s restructuring of Social Security.
The Financial Services Forum, an association of 19 chief executives of large financial-services companies, has decided to withdraw from Compass, the group that is leading industry’s effort to drum up support for the president’s plan.
The forum is the third defection in a month from business-led Social Security coalitions. Waddell & Reed Financial and brokerage Edward D. Jones & Co. withdrew from the Alliance for Worker Retirement Security, a sister organization to Compass.
Separately, the AFL-CIO said it plans public protests against Charles Schwab Corp. and Wachovia Bank on March 31 because the companies back Bush’s plan for private Social Security accounts.
Compiled from Reuters, The Associated Press, Bloomberg News and the Washington Post — Los Angeles Times News Service