Business & Finance
Citigroup's reputation took a new hit in East Asia, as regulators with the South Korean Financial Supervisory Service said they'll investigate foreign-exchange transactions that may be linked to money-laundering. Citigroup bought South Korea's KorAm Bank in April for $2.6 billion, although it was not clear what impact the coming probe may have on the bank's operations, the Financial Times reported. Last month, regulators in Japan ordered the US financial services giant to cease private banking operations there, and then, days later, banned it from participating in auctions of government bonds.
For the first time in two decades, General Motors will put its information technology service contracts, worth an estimated $3 billion a year, up for bid, the Detroit News reported Sunday. The automaker's 10-year master service agreement with Electronic Data Systems (EDS) expires in June 2006. Smaller portions are held by IBM, Hewlett-Packard, and other providers, which, with EDS, are expected to engage in a bidding war for the new contract. The newpaper said GM seeks to reduce the myriad computer systems and processes on which it relies.
SunGard Data Systems Inc., a leader in investment support systems, said it will spin off its Availability Services unit to shareholders. Availability Services ensures that corporate data and records are accessible in the event of natural disasters or terrorism, a business largely separate from SunGard's transactions-processing and asset management operations. The Wall Street Journal said the initial public offering could command at least half of the company's $7 billion market capitalization. SunGard is based in Wayne, Pa.
Abandoning the idea of an initial public offering, Saga Ltd. agreed to $2.4 billion buyout by the private equity firm Charterhouse Capital Partners. Saga tailors its products and services - mainly vacation packages and health and property insurance - to the over-50 market. The sale is worth roughly twice what clients indicated they'd be interested in investing in the IPO, reports said. Saga is based in Kent, England; Charterhouse in London.
BASF, the world's largest maker of chemicals, has decided to double the value of its stock-buyback program to $1.2 billion, effective immediately, it said in a regulatory filing.