Business & Finance
Tyco International Ltd., fighting back against its mounting legal problems, sued two former high-ranking officers, accusing them of hiding a criminal investigation from directors and negotiating a huge finder's fee without board approval for acquisition of a subsidiary last year. The Bermuda-based conglomerate is seeking recovery of $55 million from ex-chief counsel Mark Belnick and former outside board member Frank Walsh, plus compensatory and punitive damages. Walsh called the move "a clear overreaction" to Tyco's "well-reported problems." Belnick's attorney said the suit was "a shabby tactic" and denied any wrongdoing by his client.
The Vivendi Universal media conglomerate will cut its stake to less than 50 percent in its water and waste-services subsidiary, the company announced. The sale, considered likely to fetch about $1.8 billion, will take place as soon as possible, although no potential buyer was identified. Proceeds will be applied to reducing Vivendi's roughly $30 billion debt. Vivendi Environnement supplies water to almost half of France's communities
Its remaining shares in Munich Re, the world's largest reinsurance company, were sold for $1.5 billion by Deutsche Bank. Deutsche Bank, the largest in Germany, already had cut its stake in Munich Re to less than 5 percent last month as part of a portfolio divestment.
Adelphia Communications Corp., apparent sliding closer to bankruptcy, missed $55.5 million worth of interest payments on two long-term bond issues, the first of which isn't due until December of 2007. The US's sixth-largest cable TV operator already has defaulted on $7 billion in debt and is the target of two grand-jury investigations and one by the Securities and Exchange Commission.
Struggling energy wholesaler Aquila Inc. will pull out of the unregulated trading business, the Kansas City (Mo.) Star reported, quoting an internal memo to employees. The move will cost most of the company's 1,200 merchant services division employees their jobs, on top of 700 layoffs announced earlier. Aquila's focus will return to regulated utilities and power generation, the newspaper said.