weighs on Agere's IPO
Another earnings warning from Nortel Networks, one of Agere Systems' biggest customers, left shares of the Lucent Technologies spin-off trading only slightly higher as Agere joined the Big Board.
The stock opened at $6.06 after Agere Systems priced 600 million shares at $6 each through underwriters led by Morgan Stanley Dean Witter. The shares closed at $6.02.
"The opening shouldn't be a surprise with 600 million shares--anyone who wanted the stock got it," said Irv DeGraw, analyst at WorldFinanceNet.com. "The stock will value rapidly and fully. It's being introduced following Nortel's warning so the deal reflects Lucent's needs, not Agere's."
ENTERTAINMENT GIANT
Walt Disney shares fall
Shares of The Walt Disney Co. fell almost 3 percent Wednesday after the company said it plans to eliminate 4,000 full-time jobs, or about 3 percent of its work force, citing "increasingly pressing challenges of the softening economic environment."
The media and entertainment giant said late Tuesday it will try to achieve the cuts through a voluntary program within the next month, but that layoffs will occur if the full reduction is not achieved.
The cuts will come across all operating areas, including the company's corporate staff in Burbank, Calif., and would be accomplished by July, the company said.
ACQUISITION
GE deal to create
global satellite provider
General Electric Co. will sell its satellite unit to a Luxembourg company for $5 billion in cash and stock, creating a satellite services provider with a global reach, the companies announced Wednesday.
Societe Europeenne des Satellites SA will provide GE with $2.7 billion in cash and a 25 percent stake and a 20 percent voting interest in SES Global, a new company in Luxembourg created by the deal. The new company consists of SES and GE Americom, the company's satellite unit which had been run by Stamford-based GE Capital.
SES had been strong in Europe, while GE has a strong presence in North America, the companies said. With partnerships in Latin America and Asia, the combined company will be able to provide global satellite services to its customers.
BEVERAGE GIANT
Coca-Cola forecasts growth
Coca-Cola Co. said Wednesday it expects first-quarter worldwide case volume growth of 4 percent to 5 percent, although sales in the company's largest market -- North America -- continue to flounder.
Case units are expected to grow by only about 1 percent this quarter in North America, which has performed weakly for Coke the past two years as bottlers and retailers raised prices. One case unit is equal to 24 eight-ounce servings.
The beverage giant said it believes more marketing in North America later this year will lead to better performance. That market, primarily U.S. consumers, accounts for 30 percent of Coke's profits.
Coke shares fell 50 cents to $46.11 in afternoon trading Wednesday on the New York Stock Exchange.
OVERLAND PARK
Sun Publications
fires, hires publisher
The owner of Sun Publications has fired one publisher, hired another and settled a lawsuit by the company's former publisher and owner.
Terri Dearth, whose nine months as publisher and president of Sun Publications were dogged by controversy, was fired Monday and replaced by Mark Lane, publisher of a Wichita shopping guide owned by Sun owner Lionheart Holdings.
In another development, Lionheart settled the lawsuit brought by Sun Chairman Steve Rose, the company's former publisher and owner. Rose had sued last year after Dearth proposed to move his twice-weekly column off the front page of Sun's newspapers and told him he no longer would be permitted to endorse political candidates.
Since its purchase by Lionheart in late 1998, Sun has experienced a steady exodus of key personnel, declining sales and editorial missteps.
Dearth declined to discuss her firing, but said she would return to Ohio where she once published community newspapers.
TELECOMMUNICATIONS
ADC announces layoffs
As spending in the telecommunications sector dwindles, ADC Telecommunications Inc. joined the growing list of equipment makers planning layoffs and warning that earnings will fall short of expectations.
Citing the difficult economic environment, the company said it will post a loss for its second quarter and eliminate up to 4,000 positions.
"The rapid downturn of telecommunications capital spending is clearly having a greater than anticipated impact on ADC's revenue and profits this year," said Richard Roscitt, ADC's newly appointed chairman and chief executive officer.
ADC expects to post a pro forma loss for its second quarter between 10 and 15 cents per share, compared with a profit of 10 cents per share a year earlier. Analysts had forecast a profit of 9 cents per share.
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