Enron's bankruptcy reorganization plan encountered a potentially serious roadblock when the Oregon Public Utility Commission's staff recommended blocking the sale of Enron subsidiary Portland General Electric to Texas Pacific Group, a Fort Worth private equity firm. Last week, U.S. Bankruptcy Judge Arthur J. Gonzalez approved Enron's reorganization plan, which includes the sale of PGE, but the sale is subject to the approval of Oregon regulators. Bryan Conway, the PUC case manager, said the PUC staff determined there were too many unanswered questions about the risks for customers. The matter is not expected to come to a commission vote until December.
Report: Banks Covered for Parmalat
Parmalat Finanziaria's main banks such as Citigroup and UBS allowed the bankrupt Italian foodmaker to hide its financial situation for more than a decade, according to a report ordered by Italian prosecutors investigating the company's collapse. The report outlines about $17 billion of bond sales, private placements and loans made to the dairy company, which collapsed in December after disclosing that a $4 billion account at Bank of America did not exist.
DreamWorks, hoping to capitalize on the popularity of its record-setting animated film "Shrek 2," will begin selling stock in its animation division this fall, the company said. Control of DreamWorks Animation will remain in the hands of DreamWorks co-founders Jeffrey Katzenberg and David Geffen, according to a registration statement filed with the Securities and Exchange Commission. The long-expected offering is designed to raise enough cash to begin paying investors, including Microsoft co-founder Paul G. Allen, who helped finance the privately held studio in 1994.
Verizon Communications today will announce that it will offer consumers its own version of an Internet-based phone service. The Internet technology allows users to make telephone calls over their high-speed Internet lines at discounted rates. The residential service will be available to any home in the United States that has a high-speed Internet connection, including Verizon's 2.4 million high-speed Internet customers.
The House voted to preserve a tax benefit for small-business investments, while also easing tax complications for some businesses and individuals. House lawmakers voted 424-0 to retain through 2007 a tax break for small businesses that allows them to immediately deduct up to $100,000 in investments. Left unchanged, the amount of new investment that businesses could write off would drop to $25,000 starting in 2006.
Philip Morris USA and Altria Group were fined $2.75 million for destroying e-mail evidence in a $280 billion government lawsuit against cigarette makers, and 11 company executives will be barred from testifying in the case, U.S. District Judge Gladys Kessler ruled in Washington. The order limits the evidence Philip Morris can use to defend against claims that it conspired for 50 years to hide the risks of smoking. Philip Morris called the loss of e-mails "inadvertent" and said it was "studying its legal options."
Liberty Media agreed to swap its stakes in various cable television and Internet properties and $545 million in cash for the roughly 4 percent of its stock held by Comcast, the nation's largest cable operator.
Mitsubishi Motors will eliminate more than a third of the jobs at its sole U.S. plant and cut daily production to a single shift from two as vehicle sales decline. The Tokyo company's Normal, Ill., factory will cut 1,200 jobs.
DaimlerChrysler employees protested proposed cuts in breaks and late-shift pay, parading a column of forklifts at the company's largest German plant. The company's top worker representative said talks with management had reached a difficult phase. DaimlerChrysler has faced a week of intermittent protests and work stoppages after it demanded that workers give up $620 million in costs annually or see 6,000 jobs disappear at a factory near Stuttgart.
Kmart is recalling about 38,600 pool pump water guns because the nozzle can unexpectedly come off and be propelled. The water guns are 15 inches long and shaped like large syringes with a cone-shaped nozzle and are either orange with a green handle or yellow and blue. Consumers should return them to a Kmart store for a full refund.
Colgate-Palmolive said second-quarter earnings rose 3.9 percent, to $373.9 million, helped by higher sales in Asia and Europe. North American sales declined for the fourth consecutive quarter.
Honeywell International said second-quarter profit rose 13 percent, to $361 million, on increased sales of products for airplanes and factories. The maker of cockpit electronics raised its 2004 forecast.
J.P. Morgan Chase reported a loss of $548 million for the second quarter, compared with a profit of $1.83 billion in the same quarter a year earlier, after pumping up its reserves by $2.3 billion to cover the expected cost of litigation stemming from the Enron and WorldCom bankruptcies.
Eastman Kodak, driven by a surge in sales of digital cameras, photo kiosks and health-imaging products, posted a 37 percent jump in second-quarter profit, to $154 million. Revenue rose 6 percent, to $3.47 billion.
Lucent Technologies swung to a profit, earning $387 million in its third quarter compared with a loss of $254 million in the same quarter a year earlier. The telecommunications equipment maker posted revenue of $2.19 billion, up 11.4 percent.
Merck reported a 1 percent drop in second-quarter profit, to $1.77 billion, as higher costs for production and research and development outweighed increased sales. The pharmaceutical giant posted revenue of $6.02 billion, up 9 percent.
Pfizer said it swung back to a profit, earning $2.68 billion in the second quarter compared with a loss of $3.59 billion in the same quarter a year earlier stemming from its acquisition of Pharmacia. The world's largest drug company reported revenue of $12.27 billion, up 24 percent.
PNC Financial, which last week announced it would buy Washington's Riggs National, reported that its second-quarter profit jumped 65 percent, to $304 million.
Qualcomm said third-quarter profit more than doubled, to $486.4 million, from $191.7 million last year, on rising demand for phones based on its wireless technology.
Roche Holding said profit for the first half of its year more than doubled. The Swiss pharmaceutical company said it earned $2.33 billion, up from $1.04 billion a year earlier. The company announces earnings at the half-year and full year.
Schering-Plough had a net loss of $65 million in the second quarter, compared with a net income of $182 million last year. Revenue dropped from medicine sales, including Claritin allergy pills and the Intron line of hepatitis drugs.
Sirius Satellite Radio, the second-biggest pay-radio service after Washington's XM Satellite Radio, reported a wider second-quarter loss of $136.8 million, compared with a loss of $111.8 million in the same quarter a year earlier. The company ended the quarter with 480,341 subscribers.
Starbucks said profit grew nearly 44 percent in its fiscal third quarter, to $98.1 million, helping the fast-expanding coffee company raise its full-year earnings estimates. Revenue surged 27 percent, to nearly $1.32 billion.
United Technologies raised its 2004 forecast after second-quarter profit climbed 32 percent, helped by its elevator and air-conditioner businesses. Net income increased to $837 million, from $632 million a year earlier.
Whirlpool, helped by continued growth in its North American and European businesses and improvement by its Latin American division, posted a 13 percent increase in second-quarter profit, to $106 million. Sales reached $3.26 billion, up 9.2 percent.
Wyeth reported a 4 percent drop in second-quarter profit, to $827.3 million, citing increased research and development costs. The drugmaker's revenue increased 13 percent, to $4.2 billion.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.