Yahoo stock rose 24 percent as investors snapped up shares of the Internet search and directory service before it was added to the Standard & Poor's 500-stock index at the close of trading. The stock rose $67.18 3/4, to $348, in trading of 61.4 million shares, making it the most active U.S. stock. Yahoo founders David Filo and Jerry Yang were among the big winners on paper today. Filo's 11.6 percent stake increased $1.6 billion in value, to $8.1 billion. Yang's 11.3 percent stake rose $1.5 billion, to $7.9 billion. Companies' shares typically rise when they join the S&P 500 because mutual funds that try to mimic the index must buy the shares.
Microsoft announced a new set of partners in its push to establish its technology as the standard for delivering music and video over the Internet. Texas Instruments said it would release a new chip for use in portable audio devices that would be compatible with Microsoft's technology. General Instrument, the No. 1 maker of cable-TV set-top boxes, said it is releasing a new box using Microsoft technology to view videos downloaded from the Internet and broadcast on television. The partnerships come as Microsoft attempts to unseat RealNetworks as the leading provider of computer players allowing users to download and play music and video from the Internet.
Cendant said it has agreed to pay $2.83 billion to settle a shareholder class-action lawsuit over accounting irregularities at the franchising and marketing company. Cendant, whose brands include Days Inn and Ramada hotels, Avis rental cars, and the Century 21 real estate brokerage, said the settlement would result in an after-tax charge of $1.8 billion in the fourth quarter and would reduce earnings per share next year by 12 to 16 cents.
News Corp., the global media company controlled by Rupert Murdoch, said it will invest almost $1 billion in Healtheon/WebMD to strengthen its Internet business and expand the health news segment of its television and publishing empire. News Corp. will buy 2 million shares of Healtheon for $100 million, provide $700 million in advertising over 10 years, invest $100 million in an international joint venture and spend $62.5 million to syndicate WebMD's news. Healtheon/WebMD links physicians and consumers with health-care institutions.
U.S. corporations announced 50,907 layoffs in November, a 123 percent increase from the previous month, according to Challenger, Gray & Christmas, an outplacement firm. November's figure brought the total so far this year to 630,450, which is 47,345 behind the total for all of 1998. Retail led all other sectors with 61,684 job cuts so far in 1999. The computer industry was second with 59,343 cuts, while financial services have posted 56,683 layoffs so far in 1999.
Two Israeli researchers said they have cracked the encryption software used to protect users of the world's most popular cellular phone technology from eavesdropping. Adi Shamir and Alex Biryukov of Israel's Weizman Institute, building on research by cryptography experts at the University of California at Berkeley, said conversations on GSM phones--with about 200 million customers worldwide, about 10 million of them in the United States--could be decrypted in seconds using off-the-shelf computers after an initial, more powerful computation is performed. Thomas Wheeler of the Cellular Telecommunications Industry Association called the news "interesting if you're a cryptographer but virtually meaningless if you're a consumer," because scanners to pick up the calls are not readily available and the security software for the phones is easily upgraded.
Visx's shares fell 41 percent after a U.S. International Trade Commission judge ruled that its patents were not infringed upon by vision-correction lasers sold by Japanese rival Nidek. Shares of Visx, the biggest maker of eye-treatment lasers in the United States, fell $36.12 1/2, to $52, on the Nasdaq Stock Market, wiping out more than $2 billion in market value.
BP Amoco has agreed to pay $1.5 billion for Mobil's share in their joint European fuels business, in response to regulators' conditional approval of Mobil's merger with Exxon. Under the agreement to dissolve the joint venture, BP Amoco will take control of 8,500 European service stations and fuel pipelines serving London's Gatwick Airport. Exxon Mobil will get 51 percent of the joint venture's lubricants business and BP Amoco will receive 49 percent.
Tricon Global Restaurants agreed to combine its Pizza Hut, KFC and Taco Bell chains in Canada with Scott's Restaurants to form a new company with 640 locations in Canada. Terms were not disclosed. Scott's will hold a majority stake in the company, which will be the largest fast-food operator in Canada.
Pioneer Hi-Bred International, a unit of DuPont that produces genetically engineered seeds, accused Monsanto and Novartis Seeds of infringing on a Pioneer patent for altering the DNA of corn plants. In a lawsuit filed in U.S. District Court in Des Moines on Nov. 23, Pioneer says it is the owner of a patent issued the same day for a method of producing corn plants that can yield more ears of corn.
EchoStar Communications, the second-largest U.S. satellite-television company, said it has increased its convertible subordinated note sale for a second time, raising it by 33 percent to $1 billion amid strong investor demand. The seven-year notes will pay interest at 4 7/8 percent annually and will be convertible into EchoStar Class A common shares at $90.88 a share.
H.J. Heinz Co. said its earnings before onetime items rose 6.6 percent, to $234.8 million, in the second quarter. The results excluded nonrecurring items, including a $464.6 million pretax gain from the sale of the company's Weight Watchers business and $77 million in pretax restructuring charges.
Virginia Gas, which produces natural gas and operates pipelines, said a management group has offered to buy the company for $4 a share in cash, valuing it at about $22 million. The company, based in Abingdon, Va., owns 35 miles of gas pipeline in Southwest Virginia and a gas storage facility. It has 270 gas customers and 4,200 propane customers.