Business & Finance
Putnam Investments was reeling and its chief executive found himself under growing pressure to resign as more states joined the list of those canceling their pension-fund accounts with the company. Since civil fraud charges were filed against Putnam last week in Boston, six states have said they'll withdraw the public retirement funds they sponsor - worth more than $5 billion - and officials of Calpers (California Public Employees' Retirement System), the nation's largest, are scheduled for a meeting this week to discuss a similar move. Meanwhile, Florida and Connecticut placed the company on a "watch list" for a possible ending of their relationships with Putnam, and an unknown number of universities have withdrawn their accounts. Putnam, based in Boston, is the fifth-largest mutual-fund company and had what Sunday's Boston Globe said was $272 billion in assets under management at the time the charges were filed. The Financial Times reported that US attorneys in Boston and New York also are investigating Putnam's activities. (Story, page 1.)
A New York bankruptcy court cleared MCI to emerge from the biggest Chapter 11 filing in US corporate history. The reorganization plan, approved Friday and expected to take effect within three months, will erase $35 billion in debt at the former WorldCom, the nation's No. 2 long-distance provider. MCI still faces securities fraud charges in connection with the $11 billion accounting scandal that led to the filing and a federal inquiry into call-routing practices.
Sicor Inc., a leading maker of drugs for critically ill hospital patients, agreed to be acquired by Teva Pharmaceutical Industries, an Israeli company that has been seeking a foothold in the US market. The deal was valued at $3.4 billion in cash and stock. Sicor is based in Irvine, Calif. Teva also is negotiating to buy Savient Pharmaceuticals Inc. of East Brunswick, N.J.
Merrill Lynch, the investment banking giant, sold its private client base in Germany to Swiss rival UBS. Terms of Friday's sale were withheld by the parties, but the German unit manages a reported $1.4 billion in assets.
Trilegiant Corp. said it was laying off 296 workers at a call center in Cheyenne, Wyo., Friday. Trilegiant, based in Norwalk, Conn., sells membership services such as Travelers Advantage, Shoppers Advantage, and PrivacyGuard.