1. Archive


DUTCH INVESTIGATE AHOLD: The giant food retailer Royal Ahold said Monday that its headquarters near Amsterdam was raided over the weekend by Dutch investigators seeking evidence in a criminal inquiry into the way the company has accounted for sales at partly owned foreign units. The company has been embroiled in an accounting scandal for months, centered mainly on its American food distribution subsidiary, U.S. Foodservice. Ahold has said it has found a total of $1.1-billion in accounting irregularities.

ALUMINUM MERGER SOUGHT: Reviving a once-spurned merger effort, Canada's Alcan launched an unsolicited $3.87-billion takeover bid for French rival Pechiney in a deal that would create the world's top-selling maker of aluminum. The cash-and-share bid comes three years after Alcan, Pechiney and Switzerland's Algroup abandoned a three-way merger attempt. Pechiney expressed surprise at Alcan's bid but said its board would meet to consider the proposal. "We consider this offer hostile and undervalued," said Stephane Giraud, a Pechiney spokesman.

ADELPHIA CREDITORS SUE: Creditors of Adelphia Communications Corp. sued more than 450 banks and financial institutions for making millions in loans to the founding Rigas family using Adelphia assets as collateral. The suit filed Sunday in U.S. Bankruptcy Court names Bank of America, Citigroup and Deutsche Bank, among others. The creditors claim the loans were made to gain lucrative investment banking deals for Adelphia, the nation's sixth-largest cable television provider. The complaint seeks $5-billion and $5.2-billion in company debt to be held until the creditors are paid. Spokeswomen for Bank of America and Wachovia declined to comment Monday.

SCHERING-PLOUGH PESSIMISTIC: Drug maker Schering-Plough Corp. announced Monday that second-quarter earnings would be less than expected because of reduced U.S. sales and profits from allergy drug Claritin, now being sold in a nonprescription version with generic competition. The Kenilworth, N.J., company said earnings for the quarter should be about 12 cents a share, 6 cents less than the consensus of analysts surveyed by Thomson First Call. It also said that profits for the second half of 2003 may not reach those of the first half, which are now expected to be 24 cents a share. Analysts had projected Schering-Plough would earn 37 cents a share in the second half of 2003.

BAIRD, IRS SETTLE: Robert W. Baird & Co. says it has agreed with the Internal Revenue Service to settle allegations that the company defrauded the federal government by overpricing securities in connection with some municipal bond transactions. Baird sent refund checks totaling less than $80,000 in early June to the issuers involved in 10 transactions that occurred between 1990 and 2000 to meet the terms of the settlement, said John Rumpf, a Baird spokesman. "This covers a 10-year span, and in that time, we did hundreds of refunding transactions," Rumpf said.

HEALTHSOUTH LIKES OUTLOOK: HealthSouth Corp., the hospital company accused of $2.5-billion in accounting fraud, said it can avert bankruptcy and asked creditors to be patient. "With another 90 to 120 days . . . we think our company has an awful good chance of avoiding bankruptcy," HealthSouth Chairman Joel Gordon said. HealthSouth owes bank lenders and bondholders more than $3.3-billion, according to regulatory filings and company officials. The rehabilitation hospital operator will generate $650-million to $700-million before interest, taxes and debt in the next 12 months, officials of the Birmingham, Ala., company said in their briefing.

T-BILL RATES RISE: The Treasury Department sold $17-billion in three-month securities at a discount rate of 0.890 percent, up from 0.885 percent last week. An additional $18-billion was sold in six-month bills at a rate of 0.940 percent, down from 0.950 percent. The three-month rate was the highest since June 9, when the bills sold for 1.005 percent. The six-month rate was the lowest since June 23, when the rate was 0.840 percent. In a separate report, the Federal Reserve said Monday that the average yield for one-year constant maturity Treasury bills rose to 1.07 percent last week from 1.02 percent the previous week.