Despite a cool reception to its $5.9 billion hostile take-over bid, Northrop Grumman already is in talks with potential buyers for the automotive division of acquisition target TRW Inc., the Financial Times reported. Northrop Grumman has asked TRW to respond to its offer by tomorrow. Cleveland-based TRW is a leading supplier of military satellites to the government, although 60 percent of its earnings are from car parts such as airbags and seat belts. Some analysts said TRW may decide on its own to split and sell the aerospace and automotive businesses.
Bankrupt Global Crossing Ltd. offered its employees in the US cash payments to leave the staff by March 8, but they have only until tomorrow to accept, reports said. The settlements would be based on rank, salary, and years with the company but would not apply to workers deemed essential. Meanwhile, with an April 23 deadline for investors to propose alternative ways of assuming control of Global Crossing's assets, a shareholder group was promoting a plan to raise $5.5 billion in new capital by issuing warrants that could be converted to shares. Currently, the only would-be buyers are Hong Kong conglomerate Hutchison Whampoa and Singapore Technologies Telemedia, which have offered a combined $750 million. Although their bid would leave shareholders with nothing, both companies said they had no plans to sweeten it.
Mpower Holding Corp. was expected to announce Chapter 11 bankruptcy, the latest in a string of such filings in the telecommunications industry. In a prearranged deal, The Wall Street Journal reported, a majority of bondholders agreed to accept five cents on the dollar and an 85 percent stake in the reorganized company. Pittsford, N.Y.-based Mpower provides local, long-distance, and Internet services for small to medium-sized businesses.