Business Digest

By TIMES WIRES

© St. Petersburg Times, published February 27, 2001

NASDAQ DELISTS IMSG: Shares in Insurance Management Solutions Group slipped to a 52-week low Monday as the St. Petersburg insurance outsourcing company was delisted from Nasdaq National Market. Shares in IMSG closed at 38 cents, down 25 cents. The delisting had been expected since November when the company warned it had fallen below minimal requirements to be traded on Nasdaq. IMSG has struggled to build a client base after being spun off from Bankers Insurance Group of St. Petersburg. William R. Hough & Co., a St. Petersburg broker, said it intends to register as a market maker for the company's common stock on the OTC Bulletin Board. In a regulatory filing, however, IMSG acknowledged there is no assurance the company will be eligible for trading on the bulletin board nor that there will be a liquid market for the stock.

IPO PRICE RANGE SHRINKS: Lucent Technologies Inc. has lowered the range of Agere Systems Inc.'s initial public offering by 25 percent. Agere shares will sell for between $12 and $14 a share, down from $16 to $19. The number of shares being sold at the IPO, slated for late March, was increased to 500-million from 370.3-million, according to a filing with the Securities and Exchange Commission, leaving the proceeds the same. Lucent will be left with 62 percent of Agere, a manufacturer of semiconductors for communications equipment and components used in fiber-optic networking gear, compared with 72 percent forecast in a previous filing. Lucent shares gained 19 cents to $12.59.

MCKESSON PLANS REORGANIZATION: Health care giant McKesson HBOC Inc. said it will pull the plug on its unprofitable online business and break up its co-CEO team. As part of the overhaul, McKesson will lay off an undetermined number of workers and absorb a one-time charge in the quarter ending March 31. McKesson said co-chief executive John Hammergren will take the reins as sole president and CEO, while David L. Mahoney will leave the company. The two became co-CEOs in a June 1999 management shake-up triggered by the company's troublesome $12-billion acquisition of HBO & Co. After the January 1999 purchase, McKesson discovered HBO had been fabricating software sales, forcing the company to restate its earnings and leading to the resignation of its previous CEO, Mark Pulido. McKesson shares rose $1.08 to $32.54.

DISNEY CUTS ONLINE JOBS: The Walt Disney Internet Group laid off 135 people Monday, primarily at its ABC.com and ABCNews.com Web operations. The cuts are in addition to 400 announced in January when Walt Disney Co. eliminated its tracking stock for its Internet operations and said it will close its money-losing Go.com Web portal. The Internet Group has lost money every quarter since it debuted in January 1999. In 2000, the group lost $402-million.

EC EXAMINES GE-HONEYWELL DEAL: The European Commission decided to launch an in-depth probe of General Electric's proposed $45-billion buyout of Honeywell International Inc., pushing back a decision on whether to clear the deal by up to four months. The Commission had been due to make a decision on the deal March 6. GE said it remained confident its acquisition of Honeywell eventually would be approved. The deal also is being reviewed by U.S. authorities.

LOWE'S RAISES FORECAST: Lowe's Cos. Inc. raised expectations for the current fiscal year, sending its shares up 8 percent. Lowe's projected stronger earnings growth in the range of $2.45 to $2.50 per share, surpassing a consensus forecast of $2.40 per share. Lowe's outlook came despite a drop in fourth-quarter net income. Net earnings for the quarter ended Feb. 2 were $140.8-million, or 37 cents a share, compared with $148.9-million, or 39 cents a share, a year ago. Shares of Lowe's were up $4.33 to $58.91.

ETOYS PLANS BANKRUPTCY: EToys Inc. said it will file for bankruptcy protection in the next five to 10 days because it has been unable to find a buyer or more financing. The company will run out of cash by March 31 and is firing its remaining employees, a spokesman said. The Internet retailer will close its Web site March 8. EToys said its shares have no value and its stock will be delisted from the Nasdaq market. EToys said it will continue to seek buyers for its assets.

TREASURY AUCTION: Interest rates on short-term Treasury securities fell in Monday's auction. The Treasury Department sold $10-billion in three-month bills at a discount rate of 4.710 percent, down from 4.905 percent last week. An additional $10-billion was sold in six-month bills at a rate of 4.495 percent, down from 4.770 percent. The new discount rates understate the actual return to investors: 4.835 percent for three-month bills and 4.662 percent for a six-month bill. In a separate report, the Federal Reserve said Monday the average yield for one-year Treasury bills fell to 4.69 percent last week from 4.80 percent the previous week.

BAY AREA HOME SALES TOP NATION: Tampa Bay area sales of existing homes outpaced the nation in January. The Florida Association of Realtors said the number of homes sold in the bay area rose 3.5 percent between January 2000 and January 2001, compared with 2.4 percent nationwide. The median sales price rose 8.4 percent to $107,500 locally, versus 2.7 percent nationwide. Local figures cover only single-family homes; national data also include condominium and townhouse sales.

P&G LOWERS FORECAST: Procter & Gamble Co. said fiscal second-half profit will be hurt by lower earnings from Turkey, which devalued its currency last week. The nation's biggest maker of household products said per-share profit in the quarter ending March 31 will be 69 cents to 72 cents as sales miss forecasts by about 1 percent. Analysts had expected earnings of 72 cents a share. Turkey, which generates 1 percent of P&G's $40-billion in annual revenue, saw its lira drop a third in the past week, reducing the value of payments Procter & Gamble's customers owe. P&G's shares fell $3.92, or 5.2 percent, to $71.11.

3COM CUTS WORK FORCE: 3Com Corp. said it will fire 1,200 people, or 10 percent of its work force, as the company tries to return to profitability. The move is part of a reorganization plan announced by chief executive Bruce Claflin in December that aims to save $200-million to $250-million annually. 3Com has had three straight quarterly losses as sales to phone companies slowed and it spun off its profitable Palm Inc. electronic-organizer unit. Shares of 3Com rose 47 cents to $9.50.

© 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111

Contact the Times | Privacy Policy
Standard of Accuracy | Terms, Conditions & Copyright