In a bid to avert a collapse of Arthur Andersen LLP, Joseph Berardino resigned as chief executive, saying he hoped that would prove the Chicago-based accounting firm is serious about reform in the wake of the Enron scandal. His departure, announced on CNN Tuesday, paves the way for former Federal Reserve Chairman Paul Volcker to implement a proposed management overhaul with himself at the helm. But the firm still faces trial for obstruction of justice as well as civil suits, an exodus of clients, and efforts to break away by its foreign affiliates.
Andersen's reputation took yet another hit when it was named by the Securities and Exchange Commission in a complaint against Waste Management Inc. (WMI). The complaint accuses six former top executives at Houston-based WMI, including founder Dean Buntrock, of inflating earnings by $1.7 billion from 1992 to 1997 and defrauding investors. Last year, Andersen paid $7 million to settle an SEC suit for inaccurate audits of the trash hauler.
Dell Computer Corp. and Philips Electronics announced a $5 billion alliance in which the latter will supply such components as cathode-ray tubes and flat-panel monitors in exchange for servers and other computers. Dell also will sell Philips products through its website, and the two will collaborate on marketing and technical planning.
In a deal valued at $6.5 billion, state-owned Telia AB of Sweden said it will buy telecommunications rival Sonera Corp. of Finland. The deal requires the OK of European Union regulators. The combined company, to be based in Stockholm, is seen as better able to fend off efforts by industry leader Vodafone to penetrate the Nordic market. Together, Telia and Sonera will have more than 8 million mobile-phone and 7.6 million fixed-line customers.
Sanmina-SCI Corp., one of the world's largest contract manufacturers of electronics, said it will cut 730 jobs almost half its workforce at its plants in Sweden. The San Jose, Calif.-based company, the result of a $4.5 billion merger last year, also has facilities in 22 other countries.