Business & Finance
In a widely expected takeover, United Technologies Corp. confirmed that it will buy Chubb PLC, a leader in security and surveillance systems, for $1 billion in cash and $934 million in assumed debt. United Technologies is based in Hartford, Conn., and its divisions include Pratt & Whitney aircraft engines, Sikorsky helicopters, and Otis elevators. Chubb, which is based in England, is not related to the US insurance company.
Xerox Corp. unveiled a $3.1 billion refinancing plan to pay down an identical amount of bank debt. The copiermaker said Citigroup, Deutsche Bank, UBS, and three other Wall Street financial services giants agreed to provide $1 billion in loans and credit that will come due in 2008. Xerox said it intends to raise the rest by issuing stock and notes.
To gain the cash for another round of acquisitions, the world's largest maker and supplier of building materials announced the sale of $1.5 billion worth of new stock. Lafarge SA of Paris said it expects to concentrate on small- to medium-size companies worldwide, although some of the proceeds will be applied to "strengthening the balance sheet." Lafarge markets cement mix, concrete, clay tiles, ceramic chimney systems, plaster, insulation, wallboard, and other products.
Tobacco giant Philip Morris USA failed in its strategy for an expedited appeal by the Illinois Supreme Court of $10.1 billion in penalties from a class-action suit. That judgment was imposed in March after the company was found responsible for misleading smokers to believe that "light" cigarettes are less dangerous than those marketed as regular. In a one-sentence order, the Illinois justices ruled that Philip Morris must pursue its case through normal channels, starting at the appellate court level.