Thursday, March 20, 2003

Business digest

Federal prosecutors sue N.Y. art gallery

NEW YORK - The federal government has accused a Manhattan art gallery of cheating the government out of $26.5 million in taxes and penalties.

The action, filed Wednesday, turns up the heat on the gallery's owner, who is already under government scrutiny for his dealings with ImClone Systems founder Sam Waksal.

In a civil lawsuit filed in U.S. District Court in Manhattan, prosecutors accused Lawrence Gagosian, the Gagosian Gallery and three other men of failing to pay taxes on the sale of 58 works of art that earned $17 million in taxable gains.

U.K. orders Safeway antitrust investigation

LONDON - The U.K. government ordered an antitrust investigation of planned bids by Wal-Mart Stores Inc. and three rival suitors for Safeway, Britain's fourth-largest grocery chain, delaying or possibly blocking a takeover.

Shares of Safeway fell 9.8 percent. Tesco, J Sainsbury and Wal-Mart, Britain's top three supermarket chains, have said they intend to challenge a 2.3 billion-pound ($3.6 billion) all-stock offer by William Morrison Supermarkets.

Wal-Mart's Asda unit, Tesco or Sainsbury would control more than 25 percent of the U.K. supermarket industry with a takeover of Safeway. Only billionaire investor Philip Green's acquisition plan escaped antitrust scrutiny. Green, owner of BHS department stores, doesn't own British supermarkets.

Bristol-Myers restates earnings for 5 1/2 years

NEW YORK - Bristol-Myers Squibb Co. restated its earnings again on Wednesday, adjusting results for five and a half years - going beyond and amending the three and a half years it just revised earlier this month.

However, overall results were essentially unchanged.

Nine days ago, Bristol-Myers wiped away $900 million in profits and $2.5 billion in revenues reported from 1999 through the first half of 2002 to correct for an artificial boost from aggressive sales incentives that induced wholesalers to buy more than they could use and created a massive inventory glut.

Lender agrees to SEC consent order

CHICAGO - Federal regulators on Wednesday accused Household International Inc. of violating securities laws by making false and misleading statements about its policies last year.

The lending giant, which earlier ran afoul of authorities for alleged predatory lending practices, agreed to a consent order by the Securities and Exchange Commission to resolve the latest matter without admitting to or denying wrongdoing.

From wire reports

Conflict often spells doom for airlines
Fee for changes omitted
Kroger may be buying chain
Entrepreneur has got game
HealthSouth, chairman accused of massive fraud
Federal suit seeks millions in OT for Cintas workers
CECO's profit increases in 4th quarter
Fewer students in Mexico for break amid terror fears
Barry Diller resigns as co-CEO of Vivendi Universal
Industry notes: Manufacturing
Tristate summary
Business digest
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Morning memo