American International Group announced late Monday that chief executive officer Maurice (Hank) Greenberg will step down but remain as nonexecutive chairman. In 37 years in the post, he helped to build AIG into the world's largest and best-capitalized insurance and financial-services enterprise. But it currently is under investigation by New York Attorney General Eliot Spitzer (D), federal prosecutors, and the Securities and Exchange Commission for a transaction that critics claim could be used to manipulate earnings. Greenberg's ouster is the latest in a series of big-name corporate departures, after Boeing's Harry Stonecipher and Hewlett-Packard's Carly Fiorina. He will be succeeded by vice chairman and co-chief operating officer Martin Sullivan, the company said.
Discount brokerage Charles Schwab Corp. sued rival TD Waterhouse Group in a San Francisco court Monday, alleging it has been wrongly labeled as a high-priced firm that offers inferior service. Waterhouse's ads first appeared in late 2003. They have rankled founder Charles Schwab, who built his company over 30 years, then gave up the reins, but took them back last July. Schwab said in an interview, "I am not going to stand by and let them run ads that are patently false."
Already battered former oil industry giant Yukos reacted angrily to yet another body blow: a lawsuit that seeks $11 billion in alleged lost profits and unpaid taxes. The suit was filed in a Moscow court by state-owned oil and gas company Rosneft, which bought Yukos's choicest asset, its 1-million-barrel-a-day Yuganskneftegaz production unit, in a disputed auction late last year. The suit argues that, using offshore traders, Yukos bought crude at below-market prices from Yuganskneftegaz between 1999 and 2003, mismanaged its subsidiary, and should be liable for $5.1 billion in debts that came with the auction sale. Yukos was forced to surrender Yuganskneftegaz because of government demands for almost $28 billion in unpaid taxes and penalties. Rosneft won the Dec. 19 auction for $9.4 billion - a fraction of what Yukos had estimated Yuganskneftegaz was worth. Yukos said in a statement Tuesday: "To steal our asset, then file a false and unfounded lawsuit ... accusing our company of acting unlawfully in the operation of that asset, is ludicrous."
In what would be the largest takeover in the history of Europe's real-estate industry, property leasing specialist Metrovacesa of Spain said it has offered $7.4 billion for a French counterpart, Gecina.