Questions were being raised about the plan to extend a financial lifeline to bankrupt Global Crossing Ltd. The Bermuda-based fiber optics giant became the fourth-largest company to seek protection from creditors under the US bankruptcy code, citing $12.4 billion in debts. On the heels of the filing Monday, two Asian business partners, Hutchison Whampoa Ltd. of Hong Kong and Singapore Technologies Telemedia, said they'd invest a combined $750 million in Global Crossing in exchange for up to 80 percent of the latter's stock. But analysts cited complications that could stall court approval of the deal, among them Global Crossing's hundreds of millions of dollars worth of contracts with the US Defense and State departments.
Dynegy Inc. said it is "on schedule" to acquire bankrupt Enron's largest pipeline by Friday. Dynegy will pay a $23 million fee and assume $750 million in debt and liabilities for the 16,500-mile Northern Natural Gas system. Control of the pipeline had been a major point of contention during merger talks between the rival Houston-based energy companies that collapsed in November.
Merck & Co., the world's third-largest drugmaker, announced plans to spin off its pharmacy benefits subsidiary, Merck-Medco. Some 65 million people, or about one in four Americans, are covered by Merck-Medco, which earned $26 billion last year. Whitehouse, N.J.-based Merck said it plans an initial public offering of a portion of the new company by midyear if market conditions are favorable.
More major employers were announcing deep job cuts even as the government of Japan reported unemployment had risen to 5.6 percent in December, its fourth straight record-setting month. One of the nation's largest trading companies, Nissho Iwai, said it would lay off 5,000 workers. Japan Airlines and Japan Air System, whose merger is expected to be complete by November, announced 3,000 employees would be cut from the payroll. And computer giant Fujitsu, in the process of laying off 21,000 workers, said it needed to increase that number by another 1,000.