Tuesday, July 15, 2003

Business Digest

PeopleSoft buy OK'd; Oracle extends bid

From wire reports

PeopleSoft Inc. was cleared by federal authorities to buy business-software rival J.D. Edwards & Co. for $1.75 billion. Oracle Corp. countered by vowing to pursue its $6.3 billion hostile takeover bid for PeopleSoft.

The Justice Department ended a review and didn't ask for more information on the J.D. Edwards purchase, PeopleSoft said in a statement. The company expects to complete the deal July 17. Oracle said it extended its $19.50-a- share offer for PeopleSoft until Aug. 15.


Toyota beefs up truck plant in Ala.

Toyota Motor Corp. said it will spend $20 million more to add production of V-6 engines at a new Alabama factory as the Japanese company increases pickup truck production in its most profitable market.

Toyota will add 150 jobs at the plant, which currently makes V-8 engines, and raise capacity at the facility to 250,000 truck engines annually.

Toyota's North American manufacturing headquarters is in Erlanger.

Yahoo pays $1.63B for Web searcher

Yahoo Inc., the owner of the world's most-used Internet sites, said it will buy Overture Services Inc. for $1.63 billion to increase its revenue from Web searching, a fast-growing area where Google Inc. has emerged as the leader.

Yahoo said that it will pay 0.6108 share of its stock and $4.75 in cash for each Overture share. That values Overture shares at $24.41, a 13 percent premium over the closing price Friday.

Overture specializes in so-called sponsored search, where businesses pay to have their Web sites listed at the top of search results. Yahoo will now also be able to sell other services to the 88,000 companies that buy Overture's sponsored search advertising.

Airline delays buy of 36 new planes

HOUSTON - Continental Airlines said Monday it would put off by three years the delivery of 36 Boeing 737 airplanes, originally scheduled for delivery beginning in 2005, because of continued weakness in the airline industry.

Continental said it expects to begin accepting delivery of the planes in 2008.

"We are not going to invest in aircraft that we cannot profitably fly in the current marketplace," Continental chief executive officer Gordon Bethune said.

He said the company cannot determine whether it needs additional airplanes "until we see some return on the capital we've invested in our existing fleet of new airplanes and are confident we have a competitive long-term cost structure."

Lumber giant new OfficeMax owner

Boise Cascade Corp., the fourth-biggest U.S. maker of lumber, agreed to buy office-products retailer OfficeMax Inc. for $1.15 billion and said it may seek a buyer for its wood and paper businesses later this year.

Shareholders in OfficeMax, the No. 3 U.S. office-supply retailer, will get $9 a share in cash and stock, 25 percent more than Friday's trading price, the companies said. Boise Cascade also hired Goldman, Sachs & Co. to review options for its unprofitable building-products and paper businesses.

The purchase of Shaker Heights, Ohio-based OfficeMax will more than double annual sales at Boise's office-products distribution unit to $8.3 billion and give it 1,000 U.S. retail stores.

Schools operator will go private

Edison Schools Inc. said a group led by Chief Executive Officer Christopher Whittle will take the company private after running up $354 million in losses since 1999 as the largest manager of public schools in the U.S.

Edison agreed to be acquired for $1.76 a share in cash by a company formed by Whittle and Liberty Partners, a private equity firm. The price represents about a 13 percent premium over Friday's closing of $1.56. Edison, with a market value of about $90 million, said the purchase totaled $174 million including the assumption or refinancing of debt.

Edison returns to private hands four years after Whittle, 55, promoted it in an initial offering as a company that could earn profits and deliver superior education. The shares peaked at $36.75 in February 2001 then plunged as much as 99 percent last year, after the Securities and Exchange Commission challenged Edison's accounting.

Frisch's profits increase 50%
Erpenbeck tape used in lawsuit
Morning memo
Tristate summary
What's the Buzz?
Bargain store bans sisters
Boise Cascade agrees to buy OfficeMax
Overtime: Rules' effects are unclear to experts
Another battle over workers' comp
Business Digest