Lloyds TSB Group, Britain's most profitable bank, will buy Scottish Widows Fund & Life Assurance Society, Britain's sixth-largest pension provider, for $11.13 billion in a deal intended to boost its fund-management business, a person familiar with the situation said. The bank, the United Kingdom's fifth-largest in terms of assets, focuses on providing financial services to individuals, while Scottish Widows is said to have one of the strongest brands in the pension industry.
Deputy Treasury Secretary Lawrence H. Summers moved a key step closer to Treasury's top job yesterday as the Senate Finance Committee voted unanimously to confirm him to replace current Treasury Secretary Robert E. Rubin, who plans to leave office around July 4. The 20-0 vote cleared the way for full Senate confirmation, which is expected before the Senate adjourns for the July 4 recess.
A federal appeals court upheld a lower-court ruling striking down a Massachusetts law that bars the state from doing business with companies that trade with Myanmar, formerly known as Burma. In a decision that could affect dozens of states and local governments with economic boycotts protesting perceived social or political injustices in foreign lands, a three-judge panel of the 1st Circuit Court of Appeals ruled that the Massachusetts law "interferes with the foreign affairs power of the federal government and is thus unconstitutional." Massachusetts enacted its law in 1996 because of human rights violations by Burma's military dictators.
Rite Aid, the third-largest U.S. drugstore chain, and General Nutrition, the No. 1 U.S. specialty vitamin retailer, said they will buy stakes in Drugstore.com as part of a 10-year agreement to sell their products on the Internet. Rite Aid agreed to invest $7.6 million for 25.3 percent of Drugstore.com, a closely held online retailer of health-care products. General Nutrition will pay $2.4 million for 8 percent. Drugstore.com will have exclusive rights to Internet sales of GNC products and the Rite Aid/GNC PharmAssure brand of vitamins and supplements, to debut this fall.
Microsoft, the largest advertiser on the Internet, says that starting next year it will not buy ads on Web sites that fail to publish adequate privacy promises. The No. 2 Web advertiser, IBM, made a similar decision this spring.
Albertson's will sell 144 stores, mostly in the West, to win regulators' approval to buy American Stores and become the country's second-largest food and drug retailer, Reuters quoted a source close to the matter as saying. The divestiture would be the largest ever ordered by the Federal Trade Commission in the retail industry, but the combined company would still operate more than 2,300 stores.
Qwest Communications, which is battling Global Crossing for US West, is under pressure to sweeten its $38.6 billion bid after the local phone company rejected the offer, analysts said. US West said it will stick with Global Crossing's $36.9 billion offer, citing concern over the 18 percent drop in Qwest's shares since the offer was unveiled June 13.
Lehman Brothers Holdings posted a surprise gain in second-quarter profit to a record as the fourth-biggest U.S. securities firm benefited from a booming stock market and shrinking dependence on bonds. Net income for the three months ended May 31 rose 2 percent to $330 million. Earnings per share dropped to $2.09 from $2.12, reflecting more shares outstanding. Analysts surveyed by First Call had predicted a decline in earnings to $1.68 a share.
3Com, the No. 2 maker of networking equipment, said fiscal fourth-quarter profit rose 34 percent on higher sales of its corporate systems and Palm hand-held computers. Profit from operations for the period ended May 28 rose to $88 million, or 24 cents a share, from $65.9 million, or 18 cents, a year ago. 3Com was expected to earn 23 cents.
Novartis, a Swiss life sciences company, plans to cut about 1,100 jobs in its agricultural division over the next two years to revive the weakest of its three major businesses. Novartis said the measures would cut costs by at least $65 million a year. The company rejected market speculation it would divest or merge any of its agribusiness units.
Coca-Cola apologized to Belgium but did not admit its soft drinks made people sick. Two weeks after illnesses in children led to bans of the soft drinks in Belgium and beyond, the company placed full-page ads in major Belgian newspapers to acknowledge that the world's biggest soft-drink business had been slow to respond to consumer concerns.
The World Bank put off until tomorrow a vote on a controversial project to resettle 58,000 poor Chinese farmers on land Tibetans say is traditionally theirs. The bank said the decision to delay the meeting of the executive board for two days will enable James D. Wolfensohn, the president of the 182-nation organization, to chair the session. He is in Europe.
Manugistics Group, after four quarters of heavy losses, posted a slim first-quarter profit of $400,000, or 1 cent a share, surprising analysts who had expected the Rockville software maker to show a loss of 3 cents a share. Revenue for the quarter ended March 31 fell to $39.2 million from $41.1 million a year earlier. But the company sharply reduced spending on marketing, product development and corporate overhead, resulting in a small profit rather than the loss of $13.3 million (33 cents) in last year's first quarter.