MCI's board of directors said it would not remove the "poison pill" provision that blocks a shareholder from owning more than 15 percent of the company's stock. The announcement came after New York-based Verizon Communications agreed to purchase 13.4 percent of MCI's shares from Mexican telecom magnate Carlos Slim Helu for $1.1 billion in cash. The provision prevents Verizon from being able to buy all of MCI by negotiating deals with other major shareholders. Verizon is trying to block Denver-based Qwest Communications International from getting enough shareholder support for a rival deal. Qwest released a statement saying that MCI's rejection of its latest offer is not consistent with shareholders' best interests.
E.U. Offers to Continue Subsidies Talks
The European Union offered to keep negotiating with the United States despite a missed deadline in an attempt to settle a dispute over subsidies to the world's two biggest aircraft makers, Europe's Airbus and U.S.-based Boeing. Both sides claim the subsidies cause unfair commercial damage, but three months of talks have failed to resolve the dispute. U.S. officials have said they would not take the case back to the World Trade Organization unless Europe launches new development subsidies for Airbus. Separately, the U.S. Senate passed a nonbinding resolution, 96 to 0, urging European governments to stop lending to Airbus. It endorsed reopening a case at the WTO should Europe fail to comply.
Carla Cico, chief executive of Brasil Telecom, Brazil's third-largest telephone operator, arrives at federal police headquarters in Brasilia. Cico, 44, was charged with racketeering and illegally revealing secrets in a probe of her alleged use of U.S. security firm Kroll to investigate possible connections between the government and business rivals. The charges must be confirmed by a Brazilian court, a police spokesman said. The charges are the first to come out of a police investigation into Brasil Telecom's hiring of New York-based Kroll, a unit of Marsh & McLennan.
(Jamil Bittar -- Reuters)
Boeing received an order from Korean Air Lines for 10 787 jets, with an option for 10 more. The planes will replace aging Airbus jets. Based on list prices, the 10 planes scheduled to be delivered from 2009 to 2011 are worth $1.3 billion, but discounts are common. The 787 is Boeing's first new aircraft in 15 years and is considered key to the company's effort to take back market share from Europe's Airbus.
United Airlines, a unit of Elk Grove, Ill.-based UAL Corp., said in a bankruptcy court filing that it intends to replace existing pensions and tear up collective bargaining agreements with the mechanics and machinists unions if they don't agree to permanent pay cuts and other concessions by a May 11 trial date. Escalating fuel prices have left the airline in no position to compromise on its cutback plans, chief executive Glenn Tilton said.
Microsoft agreed to pay computer maker Gateway $150 million over four years to settle a legal dispute arising from Microsoft's federal antitrust case, and Gateway said it will use the money to market and develop products that run Microsoft software and release all antitrust claims against Microsoft based on past conduct. Microsoft denies any wrongdoing. To account for the settlement, Microsoft said it would take a $123 million pretax charge in the quarter ended March 31.
T-bill rates were mixed. The discount rate on three-month Treasury bills auctioned yesterday fell to 2.71 percent, from 2.735 percent last week. Rates on six-month bills rose to 3.065 percent from 3.035 percent. The actual return to investors is 2.767 percent for three-month bills, with a $10,000 bill selling for $9,931.50, and 3.156 percent for a six-month bill selling for $9,845.05. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, fell to 3.33 percent last week from 3.38 percent the previous week.
Lazard, the investment bank headed by Bruce Wasserstein, plans to sell about 30.5 million shares, or one-third of the company, to the public for as much as $27 each, valuing the company's parent at about $3.9 billion. Lazard Group, the investment bank's parent, said it expects the shares to sell for between $25 and $27, raising between $761.5 million and $822.4 million. Wasserstein needs the money to pay off Chairman Michel David-Weill, who demanded $1.62 billion for himself and companies he controls to go along with the IPO.
Global Crossing settled with federal regulators as three former executives agreed to pay fines but with no finding of fraud in the "capacity swap" deals made before the telecommunications company collapsed in bankruptcy. Former chief executive Thomas Casey, ex-chief financial officer Dan Cohrs and former executive vice president of finance Joseph Perrone will each pay a $100,000 civil fine.
The European Union is considering suspending imports of corn gluten animal feed from the United States worth $450 million a year after shipments of an unauthorized genetically modified corn were sent to the E.U., a spokesman said. The dispute concerns U.S. handling of a case involving a type of animal feed called Bt10 that Swiss agrochemicals company Syngenta inadvertently sold in the United States and exported to Europe without approval. E.U. spokesman Philip Tod said the decision to suspend imports could depend on Syngenta providing European authorities with a method for detecting Bt10.
Elan stock trades are under investigation by the U.S. Securities and Exchange Commission. Shares in the Irish pharmaceutical company have lost 85 percent of their value since Feb. 28, when Tysabri -- the promising multiple sclerosis drug Elan is developing -- was linked to a potentially fatal disease of the central nervous system.
Kraft Foods is recalling Jell-O chocolate pudding that may contain pistachio nuts without listing them as an ingredient. Kraft estimated that more than 148,000 packages were produced and distributed nationwide. The 1.4-ounce packages are sugar-free, fat-free or reduced-calorie instant pudding or pie filling in white chocolate, chocolate and chocolate fudge flavors. Customers may call 800-323-4243 for more information or visit the Web site www.kraft.com/specialreport/Jell-O.
SLM, also known as Sallie Mae, the nation's largest provider of student loans, granted Thomas J. Fitzpatrick, its incoming top executive, 1 million stock options last month, according to a regulatory filing. According to the proxy statement filed with the Securities and Exchange Commission, the Reston company hasn't reached a final agreement with Fitzpatrick. Awards of 2.3 million options and 200,000 restricted stock units are being considered over a three-year period, the filing said.
Limited Brands, whose stores include Victoria's Secret, Express and Bath & Body Works, restated its fourth-quarter results after correcting lease accounting methods. With the restatement, earnings for the three months ended Jan. 29 decreased 1 percent, to $382.5 million, from $387.6 million in the corresponding quarter a year earlier. The company had previously reported quarterly profit of $415.8 million. Revenue for the quarter rose 3 percent, to $3.33 billion, and was not affected by the restatement. For the full year, Limited's restated earnings rose 9 percent, to $637.3 million, over fiscal 2003. The company had previously stated full-year profit of $705.4 million. Full-year revenue rose 5 percent, to $9.41 billion, over the previous year.
Genentech, a San Francisco biotech firm, said first-quarter earnings rose 61 percent, to $284.2 million, over the corresponding quarter a year earlier. Revenue for the three months ended March 31 rose 50 percent, to $1.46 billion.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.