Business digestCompiled from Times wires
© St. Petersburg Times
published May 1, 2002
DILLER MISSES OUT ON BONUS: USA Networks Inc. denied bonuses to Barry Diller and other top executives because the media and Internet-commerce company didn't meet performance targets in earnings, revenue and cash flow. Diller's compensation package totaled about $754,000 in salary and benefits last year compared with $2.6-million in pay apart from stock options in 2000, according to a filing with the Securities and Exchange Commission. Diller, 60, hasn't received stock options since 1997. Other executives who were out of a bonus last year are vice chairman Victor Kaufman, general counsel Julius Genachowski, and chief financial officer Dara Khosrowshahi, who was appointed to the post in January.
EARTHLINK CO-FOUNDER ADMITS FRAUD: Reed Slatkin, co-founder of the Internet access provider EarthLink Inc., pleaded guilty Monday to 15 federal counts relating to a fraud scheme that bilked investors out of at least $254-million. He will face up to $3.75-million in fines and 105 years in prison, but federal prosecutors expect he will receive a sentence of 12 to 15 years in exchange for the plea. Sentencing was scheduled for Sept. 23. Slatkin, 53, also served as a financial adviser to celebrities, business executives and socialites. Starting in the mid-1980s, Slatkin began investing for Church of Scientology members so they could devote themselves to church work instead of worrying about making ends meet. He told investors he would pool their money to buy stocks, according to the Securities and Exchange Commission. Some church members profited; others lost their investments.
GM FINALIZES DAEWOO STAKE: General Motors Corp. signed a final deal to acquire parts of South Korea's Daewoo Motor Co., gaining an important production foothold in the fast-growing Asian market. Under the deal, GM will invest $400-million for a 67 percent stake in the new company, with the remaining 33 percent to be held by Daewoo creditors, who will invest $197-million. The signing capped seven months of tough negotiations. The last obstacle was lifted two weeks ago after Daewoo workers voted for the sale of their company's key assets to the U.S. carmaker. Workers had held violent protests against a GM takeover, which they feared would lead to mass layoffs. The union backed away from its opposition after GM promised to maintain employment at current levels and offered to rehire 300 workers who had been laid off.
BAY AREA MAKES PITCH TO GOP: A contingent of 22 tourism officials from Hillsborough and Pinellas counties today make their first pitch in Washington to host the Republican National Convention during the 2004 presidential election year. The delegation includes officials from St. Petersburg and Tampa. Tourism industry leaders have yet to decide which local venues and hotels will be in the formal bid that is due June 17. The region is one of 24 markets the GOP invited to submit bids for the event.
CHRYSLER TEAMS WITH MARTHA: DaimlerChrysler AG's Chrysler unit has teamed up with Martha Stewart, the doyenne of homemaking, in an agreement that includes advertising in her company's magazines. The automaker's Chrysler-brand vehicles also will be featured in articles in Martha Stewart Living magazine, and Stewart will take part in promotions that include invitation-only parties and contests for a chance to meet her.
IBM PLANS BUYBACK: IBM said it will buy back as much as $3.5-billion more in shares. IBM spent $12-billion on share repurchases in 2001 and 2000 and has spent an annual average of $6.3-billion in the past seven years. Separately, IBM raised its quarterly dividend to 15 cents a share from 14 cents, the seventh increase since 1996. IBM stock slid 13 cents to close at $83.76.
NORTHWEST TO RECALL WORKERS: Northwest Airlines said it was recalling 670 people to work at flight gates and ground crews through the peak summer travel months. It's the airline's biggest recall since it lopped off 10,000 of its 53,000 jobs in September in response to the downturn in air travel after the terrorism attacks. The full- and part-time workers involved in the recall will have their jobs from June 1 to Sept. 1. A few will be kept on permanently.
TREASURY AUCTION: Interest rates on short-term Treasury securities rose in Tuesday's auction. The Treasury Department sold $16-billion in four-week bills at a discount rate of 1.735 percent, up from 1.64 percent last week. The government received bids for the bills equal to 2.46 times the amount sold.
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