Business Digest

BUSINESS DIGEST

August 18, 2004

In The Region

Mills Corp. to buy 50% stake in 9 malls, two of them in Md.

Mall developer Mills Corp. will acquire a 50 percent interest in nine malls from General Motors Asset Management Corp., a unit of General Motors Corp., for about $1.03 billion before transaction costs.

Mills, a real estate investment trust in Arlington, Va., said yesterday that it is buying the stake because of the malls' "high quality, attractive yields and potential for increased productivity."

Two of the properties are in Maryland: Lakeforest Mall in Gaithersburg and Marley Station in Glen Burnie. The other are Stoneridge Mall in Pleasanton, Calif.; Hilltop Mall in Contra Costa County, Calif.; Columbus City Center and The Mall at Tuttle Crossing in Columbus, Ohio; Briarwood Mall in Ann Arbor, Mich.; Meadowood Mall in Reno, Nev.; and The Falls in Miami.

Mills said it expects to finance the deal through the assumption of $170 million in existing property debt and about $377 million from new mortgages on four malls.

Provo International to buy Humana Trans Services

Humana Trans Services Holding Corp., a 3-year-old human relations outsourcing company with offices in Hanover, said yesterday that it has reached an agreement to be bought by Provo International Inc. of Pearl River, N.Y.

Provo offers residential and commercial Internet access, Web hosting and e-commerce services.

Humana shareholders will receive two shares of Provo for each three shares they own. Ronald Shapss, Humana's chairman, will become chairman of Provo when the deal closes. That's expected by Sept. 15.

Rite Aid judge rejects most of Brown's leniency pleas

A federal judge in Harrisburg, Pa., yesterday dismissed most of the defense's arguments that sought to reduce the potential prison term for former Rite Aid Vice Chairman Franklin C. Brown for his conviction on 10 counts of conspiracy, obstruction, lying to federal regulators and witness tampering.

The federal probation office had recommended Brown, 76, for a prison term of 10 to nearly 13 years for his convictions on 10 criminal counts, but Brown's lawyers have said he should face a sentence ranging from probation to no more than six months in prison.

Judge Sylvia H. Rambo disagreed with defense arguments that Brown's role in Rite Aid's accounting fraud was relatively minor, that some of his actions were not improper and that he should receive a lesser sentence because of his age, health problems and history of charitable contributions.

Brown is free pending appeals and has not been sentenced.

Elsewhere

Google's stock registration, IPO delayed by SEC

Google Inc.'s long-awaited initial stock sale, which appeared imminent yesterday, was delayed while the company awaits final approval of its paperwork by the Securities and Exchange Commission.

The Internet search company had requested its registration statement be made effective at 4 p.m. EDT, but the SEC made no decision. An SEC spokesman would not provide a reason for the delay. Google did not immediately comment.

The company has updated its regulatory filings several times in April, when it announced its plans to go public, and had planned to close its share price-setting auction no earlier than an hour after receiving the SEC's blessings. If that had happened, winning bidders could have been notified and shares could have been traded on the Nasdaq stock market as early as today.

Google anticipates its 25.7 million shares will be priced between $108 and $135 each in what could be a $3 billion initial public offering, which would be a record for an Internet company. At the midpoint of Google's price range, the company would have a market capitalization of about $30 billion - lower than Yahoo Inc.'s but above General Motors Corp.

United's parent to pick pension plans' trustee

UAL Corp., United Airlines' parent, agreed to appoint an independent trustee to protect the interests of participants and beneficiaries of the carrier's pension plans, the Labor Department said yesterday.

The trustee, to be chosen by the company with the department's approval, will review funding, asset claims and file lawsuits if necessary on behalf of the plans, the department said in a statement. The trustee must be in place before Sept. 15, when a $400 million payment is due, the department said.

UAL plans to skip about $575 million in pension contributions this year and an unspecified amount next year to conserve cash to leave bankruptcy. The company's board in June changed the structure for managing the plans, eliminating their administrative committee and appointing UAL as the sole trustee, the department said.

Pilots union seeks equity stake in Delta

Delta Air Lines Inc., seeking to reduce costs to avoid a bankruptcy filing, plans to give pilots a counterproposal tomorrow that may meet the union's request for a stake in the company, the union said yesterday.

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