Business Digest


June 28, 2005

In the Region

Emergent Bio acquires British vaccine maker

Emergent BioSolutions - the Gaithersburg maker of the only Food and Drug Administration-approved anthrax vaccine - announced yesterday it had acquired Microscience Ltd., a British vaccine company.

Terms of the deal were not disclosed, though Emergent said it involved a "share exchange agreement."

Microscience will be renamed "Emergent Europe" and operate out of its current facility near London, where it will continue work on its five vaccines, including one that protects against typhoid.

Credit outlook raised for Legg Mason

Legg Mason Inc., the Baltimore investment firm that agreed to take over Citigroup Inc.'s fund unit last week, had its credit outlook raised to positive by Standard & Poor's, suggesting the possibility of a rating increase.

S&P affirmed its "BBB+" rating on Legg Mason and lifted its outlook from stable, the rating company said in a statement yesterday. S&P cited Legg Mason's decision to swap its retail brokerage business for Citigroup's fund unit, and to buy hedge fund company Permal Group.

Legg Mason will become the fifth-biggest U.S. asset manager through the deals, which totaled more than $4.5 billion. The company gains "a more diversified mix of assets" and "increased economies of scale" in the process, an S&P analyst said in the statement.


Parts supplier gets negative review of outsourcing plan

Auto-parts supplier Lear Corp. said yesterday that it could cut up to 7,700 jobs globally and move some North American and European manufacturing facilities to cheaper countries, prompting Standard & Poor's Ratings Services to put the company on a negative credit watch.

Lear said its 12-month restructuring plan will cost the company up to $250 million, with about $30 million of that cost incurred in the second quarter of 2005.

The company said five North American or European factories will be moved to cheaper sites and that some administrative functions will be affected. It did not say which factories would be closed.

Burger King opens its first outlet in China

Burger King opened its first Chinese outlet in Shanghai yesterday, hoping to take a bite out of rival McDonald's profits in the booming Chinese fast-food market.

The company-owned restaurant sits in the heart of the Chinese commercial hub just opposite a Buddhist temple. A large hamburger sign marks the opening.

Along with famous menu offerings such as the Whopper, the outlet will sell items customized to Chinese tastes, including a hamburger seasoned with the spicy mala sauce of southwestern China, the company said.

Glaxo drug barred from market returns

GlaxoSmithKline PLC has returned its anti-depressant Paxil CR to the market, nearly four months after federal officials seized the drug from three factories for failing to meet manufacturing standards.

The pharmaceutical company said Paxil tablets now are available in U.S. pharmacies and other markets around the globe will soon stock them as well.

Glaxo said it has identified and fixed the source of the manufacturing problems at its facilities in Knoxville, Tenn., and Cidra, Puerto Rico.

The improvements were certified by a third party, the company said.

Another drug that was seized, Avandamet, will return to distribution within two weeks, the company said. Avandamet treats Type II diabetes while Paxil treats depression and panic disorder.

UAL Corp. wants to raise debtor loan to $1.3 billion

UAL Corp., parent of the nation's No. 2 airline, United Airlines Inc., said yesterday that it wants to increase its debtor-in-possession loan commitment by an additional $310 million to $1.3 billion, according a filing with the Securities and Exchange Commission.

UAL also wants to extend the maturity date of the loan to Dec. 30, with the option of a further extension to March 31, 2006, if it meets certain conditions.

UAL filed for bankruptcy protection in December 2002, listing assets of $22.73 billion and debts of $21.48 billion. The U.S. Bankruptcy Court in Chicago in December 2002 authorized UAL to strike a $1 billion financing agreement with a bank syndicate.

Ex-CEO of newspaper chain to pay triple damages

The former chief executive of Heartland Publications has been ordered to pay $5.1 million in damages to his former employer after he acknowledged borrowing $1.7 million in company funds while at the helm of the newspaper company.

James M. McGinnis, 56, whose last known address was in Ponte Vedra Beach, Fla., was president and CEO of Heartland Publications LLC until being replaced in February. Heartland publishes 19 newspapers in Ohio, West Virginia, North Carolina, Kentucky, Tennessee and Oklahoma.

Duval County Circuit Judge Jack M. Schemer granted Heartland's motion for a summary judgment in its suit against McGinnis earlier this month.

The newspaper chain said it asked McGinnis to repay the money, but he had not. In accordance with Florida law, Schemer ordered McGinnis to pay Heartland more than $5.1, which is triple the amount he took.

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