Business Digest


March 26, 2004

In The Region

Talks with union at Giant, Safeway seen going to wire

The lead negotiator for Giant Food and Safeway Inc. said yesterday that he is expecting talks with union officials on a new contract for about 29,000 employees to go down to the wire.

"I think we'll need all the time that we have available to us," said Harry Burton, the negotiator.

The contract for employees at the companies' stores in the Baltimore-Washington area expires Tuesday. Management and union representatives are negotiating over wages, pensions and health benefits.

Wyeth firing 440 workers, shutting plant in Pa.

Wyeth is firing 440 workers and shutting a Marietta, Pa., factory after completing its part of a manufacturing agreement with partner MedImmune Inc. for an experimental flu vaccine, CAIV-T.

The product is an improved version of FluMist, the inhaled influenza vaccine that MedImmune and Wyeth introduced last year and that failed to catch on with consumers. The manufacturing change is part of an existing agreement, said a spokeswoman for Gaithersburg-based MedImmune.

MedImmune and Wyeth are in talks about the future of their partnership, after sales of Flu- Mist fell short of the companies' goals. Some investors said the plant closure may be a first step toward ending the partnership.

Columbia REIT buys land, 8 buildings in St. Mary's

Corporate Office Properties Trust has bought eight buildings and two land parcels in St. Mary's County for $51.5 million.

The buildings, which total about 430,900 square feet, are near the Patuxent Naval Air Station and are filled mainly with defense contractors.

As part of the contract, the Columbia real estate investment trust will acquire two more office buildings in the Southern Maryland county in the next two months for $13.6 million, pending loan assumption approval. Corporate Office Properties Trust refused to name the seller.


Ex-Dynegy executive gets 24 years for role in financial cover-up

A federal judge in Houston sentenced a former mid-level executive at Dynegy Inc. to more than 24 years in prison yesterday for his role in a secretive project to disguise the energy company's financial difficulties. It was one of the most severe prison terms in recent memory for a white-collar crime.

The executive, Jamie Olis, a former tax-planning official at Dynegy, broke into tears after U.S. District Judge Sim Lake levied the sentence. Lake said he was acting under strict sentencing guidelines enacted in part because of congressional concerns that executives convicted of business crimes were not being punished sufficiently.

Two associates involved in the scheme - Olis' former boss, Gene S. Foster, who was a vice president for taxation, and Helen C. Sharkey, a former Dynegy risk-assessment official - pleaded guilty last year and are expected to receive sentences of less than five years each.

AT&T losing customers to rivals over wireless deal

AT&T Wireless Services Inc., which is being bought by Cingular Wireless LLC for $41 billion, may have its first quarterly subscriber loss as Verizon Wireless and other rivals lure away customers before the deal's completion.

AT&T Wireless may lose as many as 201,000 subscribers in the quarter that ends Wednesday, the "worst performance in its history," Bear Stearns analyst Phil Cusick wrote in a research note yesterday.

Verizon Wireless and Sprint Corp. say they're targeting AT&T Wireless' business clients, who tend to buy more services and generate higher monthly bills. AT&T's rivals want to gain share before the scheduled year-end close of the merger with Cingular, which will create the largest U.S. wireless company.

PeopleSoft vote favors expensing stock options

PeopleSoft Inc.'s shareholders joined the crusade to expense stock options yesterday, approving a recommendation for the business software maker to acknowledge the true costs of the popular employee incentives.

The passage of the option expensing proposal marked the only rebuke of PeopleSoft management during an annual shareholders meeting that was held two months earlier than usual because of a hostile $9.4 billion bid by rival Oracle Corp. PeopleSoft has repeatedly spurned Oracle's advances since the takeover saga began nearly 10 months ago.

Fifty-three percent of the votes cast advised PeopleSoft to join the hundreds of other companies that recognize stock options as an expense.

Like most high-tech companies, PeopleSoft has derided the accounting change as a bad idea that would discourage future distribution of stock options.

Apple delays by 3 months overseas release of iPod

Apple Computer Inc., the world's biggest maker of digital music players, delayed yesterday the worldwide release of its iPod mini device by three months, saying it needs to catch up with greater-than-expected U.S. demand.

The credit-card-sized players, available in colors such as pink and gold, will go on sale outside the United States in July, Apple said.

Lucent wins U.S. contract to rebuild Iraq systems

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