Business & Finance
Paul Volcker is likely to step down as head of a rescue effort for Arthur Andersen LLP, further damaging the auditor's ability to survive fallout from the Enron scandal, The Wall Street Journal reported. Volcker, a former Federal Reserve chairman, had made settlement of a criminal obstruction-of-justice charge against the auditing firm the key to his reorganization plan. But negotiations with the Justice Department broke down last week, and trial is set to begin May 6. Meanwhile, the Financial Times reported that Andersen has lost almost 250 clients most of its largest customers among them since Jan. 1. (Related story, page 3.)
In a $9.1 billion deal, National Grid Group and Lattice Group PLC agreed to merge their operations into an energy-delivery giant that would set its sights on new acquisitions in the US Northeast. The companies are Britain's electricity and natural-gas transmission systems, respectively. Subject to regulatory approval, the new entity will be renamed National Grid Transco. National Grid already owns three electric utilities in the Northeast, among them upstate New York's Niagara Mohawk Power.
The long-awaited takeover by Micron Technology Inc. of deeply indebted South Korean rival Hynix Semiconductor moved a step nearer completion when the companies signed a provisional agreement to merge. The deal, valued at $3.8 billion, would result in the world's largest maker of memory chips. The memorandum of understanding must be OK'd by Hynix creditors and the boards of both companies by the end of the month, with the final contract to be signed by May 30. Boise, Idaho-based Micron has been pursuing Hynix, whose debt is estimated at just under $5 billion, since late November.
Another 20,000 jobs will be cut by Ericsson, the world's largest maker of cellphone network equipment, an announcement said. The layoffs come on top of 22,000 last year amid the global slump in the telecommunications industry. Ericsson also warned that it likely would not return to profitability until sometime in 2003. The company is based in Stockholm.