Business & Finance
Merrill Lynch & Co. and four former executives were charged with fraud Monday by the Securities and Exchange Commission. The civil suit, filed in federal court in Houston, accuses the brokerage giant of helping bankrupt energy trader Enron to inflate profits through two sham transactions. Merrill Lynch agreed to an $80 million settlement in which it neither admitted nor denied wrongdoing. The former executives are contesting the allegations.Skip to next paragraph
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Procter & Gamble, the consumer products giant, agreed to acquire controlling interest in German hair-care products specialist Wella AG. The deal is valued at $6.9 billion in cash plus assumed debt. Wella is second only to L'Oréal of France in its industry. Procter & Gamble already markets shampoos and conditioners under the Clairol, Pantene, Head & Shoulders, Pert, and Aussie brands.
As expected, Spiegel Inc. filed for Chapter 11 bankruptcy protection. The clothing and home-furnishings retailer said it had arranged $400 million in financing to keep its namesake catalog and Eddie Bauer stores open during restructuring. Spiegel is based in Downers Grove, Ill.
Four major corporations announced deep austerity measures:
• Applied Materials Inc., the world's largest maker of machinery for producing semiconductors, said it will cut another 2,000 jobs, most of them in the US. Last year, the San Jose, Calif., company laid off 1,750 employees.
• Gateway Inc. notified its employees that it will eliminate 1,900 jobs and close 80 stores, effective next Monday. The latest layoffs bring to about 10,000 the number of workers let go over the past two years, a span in which Gateway has reported almost $1.5 billion in losses. The nation's No. 4 maker of computers in based in Poway, Calif.
• BAE Systems, the largest defense contractor in Britain, will cut 1,050 jobs in its maritime surveillance aircraft unit. In January, the company laid off 1,000 shipbuilders.
• Qantas, the national airline of Australia, announced it will again compel employees to use accrued vacation, a move equivalent to cutting 1,000 jobs. The same method last month affected 1,500 jobs.