In the Region Westvaco to close Pa. paper mill, shift...

BUSINESS DIGEST

September 01, 2001

In the Region

Westvaco to close Pa. paper mill, shift some work to Md.

Westvaco Corp., which agreed Wednesday to merge with Mead Corp., will take a $26 million pretax charge in its fiscal fourth quarter to close a paper mill in Tyrone, Pa., and fire 265 workers.

Production from the 121- year-old mill will be moved to Westvaco's Maryland plant in Luke, and one in Wickliffe, Ky., by next month, the company said. Westvaco has about 17,000 employees.

The rival paper makers are merging in a $3.26 billion transaction to reduce expenses and better manage production. The new company, MeadWestvaco Corp., plans to cut costs by about $325 million within two years by eliminating an unspecified number of jobs and plants.

First Union plans to finish Wachovia takeover today

First Union Corp. expects to complete its $14.9 billion purchase of Wachovia Corp. today, creating the fourth-largest bank U.S. in assets, with 19 million customers and 2,900 branches from Connecticut to Florida, including some in Maryland.

Shares of the new company, which retains the name Wachovia Corp. and its ticker, WB, will begin trading Tuesday on the New York Stock Exchange. The company, with assets of $322 billion and deposits of $181 billion, will be based in Charlotte, N.C., where First Union has its headquarters.

Sixty percent of Wachovia shareholders voted Aug. 3 in favor of merging with First Union, spurning Atlanta-based SunTrust Banks Inc.'s unsolicited $15.7 billion offer. The new Wachovia ranks behind Bank of America Corp. as the second-largest bank in the southeastern United States, one of the nation's fastest-growing regions.

Elsewhere

AMF Bowling unit files plan to get out of Chapter 11

AMF Bowling Worldwide Inc., the largest operator of bowling centers, filed a recovery plan yesterday to emerge from Chapter 11 bankruptcy protection.

A unit of AMF Bowling Inc., of Richmond, Va., AMF Worldwide and 24 company units sought Chapter 11 protection from creditors on July 2. The parent company filed for bankruptcy July 30.

Under the plan, which must be approved by a federal bankruptcy judge, AMF Worldwide's secured lenders, owed about $622.6 million, would be paid in cash, debt and new shares in the restructured company. The company's unsecured creditors, including bondholders owed more than $550 million, would receive stock options to buy 12 percent of the reshuffled shares.

Failed currency Web site files for bankruptcy

A week after closing down its operations, online currency site Flooz.com has filed for Chapter 7 bankruptcy proceedings.

The filing, in the U.S. Bankruptcy Court in New York yesterday, listed total assets of $296,000 and total liabilities of $13.93 million. It has more than 1,000 creditors, according to the filing. Creditors holding unsecured nonpriority claims accounted for $12.75 million of the company's total liabilities.

Flooz.com, which made a splash with billboards and TV advertisements featuring Whoopi Goldberg, suspended operations early last month and had unsuccessfully sought a partner.

Ericsson to license mobile phone technology

LM Ericsson, a leader in wireless technology, said yesterday that it will license its mobile phone technology to other manufacturers of phones and wireless devices.

Ericsson Mobile Platforms will start operation today with 800 employees. The headquarters will be in Lund, Sweden, and Ericsson will maintain control of the new technology-licensing company.

Ericsson plans to license complete component specifications, printed circuit board layouts and software. It also will help customize products.

This column was compiled from reports by Sun staff writers, the Associated Press, Bloomberg News and Reuters.

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