Business Digest


March 01, 2003

In the Region

Ex-W.R. Grace CEO settles fraud charges over earnings in '90s

A former chief executive at W.R. Grace & Co. agreed yesterday to settle Securities and Exchange Commission fraud charges stemming from allegations that officers manipulated earnings of the chemical producer in the early 1990s.

J.P. Bolduc, who was chief executive from 1993 to 1995 and president from 1990 to 1995, neither admitted nor denied wrongdoing. He agreed to cooperate with the SEC in its continuing investigation of the fraud and to be subject to stiffer sanctions if he violates SEC rules in the future.

Grace and two partners of its auditor, then known as Price Waterhouse, settled related SEC charges in 1999.

ADM, port unable to come to terms on state grain pier

Archer Daniels Midland Co. said it is discontinuing its operations today at the port of Baltimore, where the company had operated a state-owned export grain elevator facility for decades.

The giant grain processor yesterday said it was unsuccessful in negotiating with the Maryland Port Administration to extend its lease and restore the grain terminal's pier.

The North Locust Point grain elevator has been closed since a storm damaged the pier in June 2001. The company and the port administration have since been in dispute over fixing the pier, and ADM said a year ago that it was shifting its grain exports to Virginia.

Sweetheart Cup offers to exchange 12% notes

About a week after announcing plans to sell nearly one-fifth of its business, Sweetheart Cup Co. has offered to exchange new senior notes to bondholders that will help the Owings Mills packaging manufacturer buy more time to pay some of its debt due this year.

The offer, which expires at 5 p.m. March 27, would entail exchanging new 12 percent senior notes due next year for all of Sweetheart's outstanding 12 percent senior subordinated notes due in September. If successful, the move would extend the maturity on the $110 million bond issue to July 2004.

The company also will pay 1 percent of the aggregate principal amount of the notes tendered by a holder, and that are accepted for exchange, to those who consent by March 12.

The exchange is conditioned upon receipt of tenders from holders of at least 90 percent of the principal amount outstanding.


Palm lays off 19% of workers on day stock gets downgrade

Handheld computer maker Palm Inc. said yesterday that it was immediately laying off 19 percent of its nearly 1,170 workers. The layoffs were to be completed yesterday, the end of Palm's fiscal third quarter.

Also yesterday, J.P. Morgan Chase & Co. downgraded its rating on Palm's stock because of uncertain market conditions and a broad decline in demand for personal digital assistants, or PDAs - the same reasons Palm gave for the layoffs.

U.S. sues Smithfield Foods for not reporting stock deal

The Justice Department sued meatpacking giant Smithfield Foods yesterday, accusing the Virginia company of breaking antitrust laws by failing to report acquisitions of IBP Inc. stock while it geared up for an acquisition of the pork producer that it later lost to Tyson Foods in a bidding war.

The lawsuit seeks $5.4 million, the maximum allowed.

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

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