In what could be a key to the ImClone insider-trading investigation, a brokerage assistant at Merrill Lynch & Co. agreed to testify against home-style guru Martha Stewart under a deal with federal prosecutors, The Wall Street Journal reported. Douglas Faneuil, an aide to Stewart's broker, first backed up, then denied her claim that her sale of shares in the biotech firm was unrelated to efforts by ImClone founder Samuel Waksal's family to dump theirs one day before prices plunged. Waksal was indicted last month for insider trading.
M&T Bank Corp. of Buffalo, N.Y. will pay $3.1 billion for the US subsidiary of Allied Irish Banks, Ireland's largest, the companies announced. The subsidiary, Allfirst Financial Inc., made headlines in February with the discovery of $700 million in losses due to alleged fraud by its senior foreign-exchange dealer. He was indicted on federal charges in June. M&T, whose largest shareholder is Warren Buffett's Berkshire Hathaway Inc., has 470 branches in the Northeast. Allfirst has 260 branches in Washington, D.C., Virginia, Maryland, Delaware, and Pennsylvania.
The loss of almost all of its value in just 2-1/2 years forced closure of Germany's Neuer Markt, an exchange dominated by technology stocks as is the Nasdaq in the US. In Frankfurt, the Deutsche Bourse said the Neuer Markt would cease operations early next year and listed companies would be divided into two new groups "according to the needs of investors." The Neuer was launched in 1997, and its index reached a high of 8,140 in March 2000. The index since has plunged by 96 percent.
In layoff news:
An announcement was planned for Thursday by Germany's Dresdner Bank, confirming reports that it will cut up to 3,000 more jobs in a drive to reduce costs. In a related development, Dresdner's director of investment banking resigned because of "differences of opinion" on "difficult domestic issues."
Another 1,800 jobs will be cut by computer giant Hewlett Packard on top of the 15,000 announced earlier as a result of its merger with Compaq Computer, a spokesman said Wednesday. The company cited an unexpectedly long "slowdown in enterprise IT [information technology] spending."