Business & Finance
Verizon, the dominant local phone company in the Northeast, will acquire MCI Corp. for $6.7 billion in the communications industry's third megamerger in two months. (SBC Communications/AT&T and Sprint/Nextel Communications were the others.) Verizon reportedly was outbid to the tune of half a billion dollars by Qwest Communications International, but MCI opted to go with the more financially secure buyer. Although MCI (the former WorldCom Inc.) has had to weather a multibillion-dollar bankruptcy and accounting scandal, analysts said its lengthy roster of corporate clients and residential customers makes it attractive to Verizon, which is seeking to market cable TV and has invested heavily in upgrading its network to deliver video and interactive services.
General Motors and money-losing Fiat Auto SpA of Italy announced they are dissolving the controversial contract they signed five years ago. But the settlement, reached in intensive negotiations over the weekend, does not represent a complete parting of the ways because they will continue to work together in the production of engines, the development of "vehicle programs," and in other areas. The deal calls for GM to pay a reported $1.55 billion to $2 billion to terminate the disputed "put option" in their 2000 agreement. Under it, GM could have been forced to buy the 90 percent of Fiat it does not already own. Instead, it will return its 10 percent stake in Fiat to the Italian company.
Carly Fiorina, whose differences with Hewlett-Packard's board led to her forced resignation as chairman and chief executive last week, will exit with a $21 million severance package, MarketWatch reported, citing a proxy statement filed with federal regulators. The agreement includes $14 million in cash, or 2-1/2 times her base salary, plus a performance bonus and stock options and three months of technical support.
Lennar Corp., one of the nation's leading builders and developers, announced it will buy a portfolio of 2,500 properties in metropolitan New York and Greater Boston in a deal with Roseland Property Co. of Short Hills, N.J. Terms were not disclosed, but Lennar estimated the "average" price of the condominiums and apartments in the portfolio in "the high $600,000s," the South Florida Business Journal reported. Lennar is based in Miami.