Saturday, May 26, 2001

Business Digest




Derivatives are reported

        General Electric Co.'s finance subsidiary lost $1.2 billion in the derivative markets in the first quarter, while Citigroup Inc. gained $992 million and International Business Machines Corp. earned $507 million.

        The companies disclosed the figures for the first time in Securities and Exchange Commission filings because of a new accounting rule. The gains and losses won't affect profits until the derivatives are sold, and their value may change.
       

GM exec to lead Hughes

        General Motors Corp. vice chairman Harry J. Pearce was named chairman of Hughes Electronics Corp. on Friday, saying every “serious proposal” to buy the GM subsidiary would be considered.

        Mr. Pearce, 58, who resigned his position with GM, is replacing Hughes chairman and chief executive Michael Smith, who retired but will be retained as a consultant. Hughes executive Jack Shaw, 62, will take over as CEO and join the board.

        For months, GM has been considering sales options for Hughes, which owns DirecTV.
       

U.S. eases pork ban

        The Bush administration eased a ban on European pork imports that was imposed two months ago because of the outbreak of foot-and-mouth disease.

        Restrictions were lifted for Denmark and nine other members of the European Union that have been free of the disease. Imports of European beef and lamb have also been banned because of concerns about mad cow disease.
       

Cisco to sell space

        Cisco Systems Inc., in a reflection of a slowing economy, is trying to sublease 750,000 square feet in California's Silicon Valley.

        The effort is an about-face for the No. 1 maker of networking equipment, which had increased the number of buildings it occupies in Milpitas and San Jose, Calif., to 50 from 21 in 1998. Earlier this year Cisco said it would fire 8,000 workers and reported a $2.69 billion loss in the quarter ended April 28, its first loss since its initial public offering in 1990.
       

Lowe's to split stock

        Lowe's Cos., the second-largest home-improvement retailer, will split its stock 2-for-1 and raise its quarterly dividend 14 percent. Shareholders as of June 8 will receive one additional share for each share held, payable June 29, the company said in a statement. Lowe's will have about 770 million shares after the split, the 11th since the Wilkesboro, N.C.-based retailer went public in 1961.

Freightliner gets new leader

        DaimlerChrysler AG replaced the head of its North American truck unit Friday, tapping a turnaround expert to stem mounting losses at the region's biggest truck maker. The German-U.S. auto giant said it accepted the resignation of Jim Hebe, who had led the Freightliner unit since 1992. It named a former Freightliner finance chief, Rainer Schmueckle, to take over.

       



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