Justice Department Clears AT&T-BellSouth Deal

Antitrust regulators from the Justice Department gave their approval on Wednesday to the historic merger of AT&T and BellSouth, a $78.5 billion transaction that would partly rebuild the former telephone monopoly known as Ma Bell. Whether the Federal Communications Commission would follow suit remained unclear, however.

NFU: Coalition Calls for DoJ Investigation of Smithfield Acquisition

WASHINGTON (September 28, 2006) - A coalition of agriculture and consumer groups today reiterated the call on the Department of Justice (DoJ) to investigate the planned purchase of Premium Standard Farms by Smithfield Foods, Inc. The coalition contends the proposed acquisition, if approved, will escalate the excessive consolidation of livestock markets and could lead to the potential manipulation of consumer retail prices for pork and beef products.

Equity Deals Attract Eye of Justice

Kohlberg Kravis Roberts, the Carlyle Group, Clayton, Dubilier & Rice and Silver Lake Partners are among the firms that have received letters from the Justice Department as part of its preliminary inquiry into possible anticompetitive behavior in the private equity industry. The requests were broad and without mention of any specific transaction or auction, The New York Times reported. The Financial Times's Lex column says that the U.S. is right to look into the question of collusion in the buyout industry, and Breakingviews writes that such an inquiry was "probably inevitable."

Buyout Firms May Face Anticompetitive Investigation

The Justice Department has sent letters to some prominent private equity firms in what appears to be an inquiry into potentially anticompetitive activity, people who received the letters told DealBook. The requests for information suggest that the delicate dance among buyout firms, who compete in some deals and work side-by-side on others, is drawing some unwanted attention.

The question of whether there is collusion in the private equity world has long been a controversial matter, as DealBook wrote in an October 2005 column in The New York Times. In private, some buyout executives concede that firms’ cooperation, often in the form of “club deals,” can have the effect of lowering prices for the companies they are acquiring.

Whether this amounts to anticompetitive behavior, however, is another matter. Recent auctions have shown that rival buyout teams can fight hard for a takeover target. Consider the recent example of Freescale Semiconductor, in which a competing consortium swooped in with a last-minute offer, albeit an unsuccessful one.

Google Moves Closer to YouTube Deal

After marathon negotiations over the weekend, Google could announce a deal to buy YouTube.com, the popular video-sharing Web site, for about $1.6 billion as early as Monday afternoon, people involved in the talks said.

Barring a last-minute snag in the talks, the boards of both Google and YouTube were scheduled to hold separate board meetings on Monday to approve the deal, with an announcement possible after the close of regular trading. Discussions could still break down, however, or another party could present a more-attractive offer.

Pension Funds Raise the Stakes in Buyout Game

Little old ladies and leveraged buyouts rarely appear in the same sentence.

But some retirement funds are quietly beginning to plow billions of dollars of those ladies’ pensions directly into supersized takeover deals, joining with — and in some cases even sidestepping — private equity funds.

While pension funds have long doled out money to private equity firms to invest for them in deals, some funds are increasingly looking to play the role of Henry R. Kravis instead of the passive investor.

Dolan Family Offers $19 Billion in Bid to Take Cablevision Private

One of New York’s most powerful families, the Dolans, made a $19.2 billion leveraged bid yesterday to buy out the public shareholders of its cable television empire, Cablevision Systems, which also includes Madison Square Garden, Radio City Music Hall, the New York Knicks and the New York Rangers.

The offer comes a year and a half after the Dolan family, a sometimes fractious dynasty whose feuds have often spilled into public view and who have used their cable systems to fuel their political interests, proposed breaking the company in two. The family wanted to take over the lucrative cable systems but was forced to withdraw the plan when it met resistance from an independent committee of the company’s directors.

A Kink in Venture Capital’s Gold Chain

The high-risk, high-return venture capital business may have turned into all risk and no return.

That, in a nutshell, is the message that a prominent venture firm delivered yesterday to its investors when it told them that it could not continue to take their money — at least not for the time being.

“The traditional venture model seems to us to be broken,” Steve Dow, a general partner at Sevin Rosen Funds, said in an interview.

Explaining its decision, Sevin Rosen, which has offices in Dallas and Silicon Valley, said that too much money had flooded the venture business and too many companies were being given financing in every conceivable sector.

But excess of capital is only part of the problem, the firm said. In its letter, it bemoaned what it described as “a terribly weak exit environment,” a reference to the dearth of initial public offerings and to a market for acquisitions at valuations that it considers too low to deliver the kind of returns that venture investors expect.

Rumor: Google in Talks to Buy YouTube

The Web site Techcrunch was reporting Friday that Google, the Web search giant, is in discussions to acquire video sharing site YouTube. The potential price was said to be about $1.6 billion, although the site cautioned that the tip was still unconfirmed.

Millions of users flock to YouTube to view a motley mix of homemade videos as well as television and movie clips — many of them posted without a thought to who might own the copyright. The site is still fleshing out its business model, gathering sponsorships and advertisers while trying not to turn off its legions of viewers. Media companies are still unsure whether to view the site as a threat to their livelihood or a valuable partner.

Given its popularity, speculation has run rampant that someone would want to buy YouTube to tap into its growth and steady stream of eyeballs.

Mutual Fund Voting

October 5, 2006
Mutual Fund Voting
posted by Bill Sjostrom at 4:05 pm
The W$J ran a story earlier in the week on mutual fund voting (see here). The story reported on the somewhat old news that academic research has “found no evidence of fund companies tailoring their votes to specific business relationships,” contrary to earlier claims by shareholder activists. The article is nonetheless of interest because it describes the varying processes mutual fund companies use in deciding how to vote.

One thing I’ve found puzzling about mutual fund voting is that the SEC requires fund investment advisers to vote the shares in the portfolios they manage. The SEC asserts that “[t]he duty of care requires an adviser with proxy voting authority to monitor corporate events and to vote proxies.” This requirement has more or less spawned the proxy advisory industry and the attendant fees paid by mutual funds to ISS, Glass Lewis and the like for their voting advice. In my mind a specific fiduciary duty to vote is foolish. Certainly, the voting of proxies by mutual fund managers should be subject to the duty of care and loyalty. But a fund manager should be free to decide that it’s in the best interest of a fund for the manager to not to spend the time and money involved in voting. At least a fund manager should be able to disclaim the fiduciary duty to vote by saying as much in the fund prospectus. Personally, I would rather a fund not spend money on proxy advisers or voting thereby reducing fund expenses. I’m in complete agreement with the sentiment expressed in the article–if a fund manager does not agree with a company’s direction, they should either not invest or sell as opposed to attempting to change the direction of the company through voting. As for index funds that don’t have this luxury, I don’t care. I invest in these funds to get the market return. I don’t want to pay higher expenses in the event the index fund manager decides to engage in shareholder activism. Leave it to the hedge funds and keep my expense ratios low.

Google to Offer Annual Bonuses of Up to $3 Million

Oct. 5 (Bloomberg) -- Google Inc., the most-used Internet search engine, will give cash bonuses of up to $3 million to executives that are linked to annual sales and profit goals.

The bonuses will be available to all executives excluding Chief Executive Officer Eric Schmidt and Presidents Larry Page and Sergey Brin, Google said today in a filing with the U.S. Securities and Exchange Commission.

The cash bonuses come as Google's stock price stalls. Shares of the Mountain View, California-based company are little changed this year after more than doubling in 2005. The company said bonuses will be linked to the performance of each individual as well as the company's overall financial performance.

Rumble at MySpace

A battle is brewing over last year’s sale of MySpace, a deal that is widely seen as the marquee transaction of the Web’s second wave. The contenders may seem comically mismatched — MySpace’s founder is squaring off with media titan News Corporation — but the dispute has begun to attract a lot of attention.

It was already known that Brad Greenspan is suing the site’s former parent company, Intermix, and others over last year’s deal to sell itself for $580 million. Mr. Greenspan, who was at one time Intermix’s C.E.O., contends the sale negotiations were rigged to produce a low-ball price for MySpace, a popular Web site that allows users to create personal pages and link to others’ pages.

On Thursday, however, Mr. Greenspan stunned the Web community by releasing exceprts from internal e-mails and legal depositions that he says support his claim that the transaction was “one of the largest M&A scandals in history.”

Mr. Greenspan also calls for a federal investigation and an unwinding of the sale, alleging that Intermix hid key revenue data from shareholders in order to facilitate a deal with News Corporation.

Pequot Says S.E.C. Won’t Take Action

The staff of the Securities and Exchange Commission has notified Pequot Capital Management, a prominent hedge fund run by Arthur J. Samberg, that it will not recommend an enforcement action against the firm or its employees relating to an insider trading investigation, according to a letter sent yesterday by the fund to its clients.

Saying that Pequot was “gratified by the staff’s determination,” the letter noted that the S.E.C. had not yet closed the investigation. The commission, as is its custom, declined to comment on Pequot’s disclosure. The fund has maintained that its trading was proper at all times.

Weak Results Dim Hedge Funds’ Luster

With the fall from grace of hedge funds such as Archeus Capital, whose holdings have fallen to just $682 million from $3 billion in 2005, and the recent meltdown of Amaranth Advisors, it looks like the blush may be coming off the rose.

In another words, hedge funds, investments for institutions like pension funds and endowments and the wealthy, have hit a rough patch.

“In the hedge fund world, everybody is looking at their portfolio and asking themselves: ‘Do I have another Amaranth in my portfolio?’” Tim Cook, the president of Kailas Capital, an investor in hedge funds, told The New York Times.

Former H.P. Chairwoman to Face Charges

Patricia C. Dunn, the former chairwoman of Hewlett-Packard, and four other people will be named in indictments expected to be filed by California’s attorney general on Wednesday in the spying case at the company, lawyers involved in the case told The New York Times.

In addition to Ms. Dunn, Attorney General Bill Lockyer intends to indict Kevin T. Hunsaker, a former senior lawyer at H.P.; Ronald L. DeLia, a Boston-area private detective; Joseph DePante, owner of Action Research Group, a Melbourne, Fla., information broker; and Bryan Wagner, a Littleton, Colo., man who is said to have obtained private phone records while working for Mr. DePante.

All of those named face four charges: using of false or fraudulent pretenses to obtain confidential information from a public utility, unauthorized access to computer data, identity theft, and conspiracy to commit each of those crimes. All of the charges are felonies.

On Tap for Banks: $8.9 Billion in M&A Fees

The backlog of merger-and-acquisition deals has hit another record, according to analysts at Merrill Lynch. In a report published Wednesday, Merrill said that the backlog of investment-banking fees for deals that have been announced, but not completed, stood at $8.9 billion at the end of September, up 5 percent from August — also a record month for fee backlogs — and more than 50 percent above last September’s level.

While the backlog means that investment banks are cued up for big payouts once the deals go through, there may be a dark cloud on the horizon: The number of announced deals worldwide was down by 32 percent last month from September of 2005. If the decline continues, it suggests that the lucrative deal pipeline may start to empty out.

As Hedge Funds Retreat, So Do Energy Prices

Many hedge funds are fleeing the energy markets these days. Are they pushing oil prices down in the process? Put more bluntly: Can we thank Amaranth and its ilk for cheaper visits to the gas pump?

Quite possibly, says BusinessWeek. This question is the flipside of one that began four years ago, when energy prices started to rise, and some people started blaming hedge funds — investment firms that cater to wealthy and institutional investors — along with other big players like mutual funds and professional traders.

Kinder Morgan Deal Gives Fuel to M.B.O. Critics

Management-led buyouts have gotten some bad press lately, including a controversial article by Ben Stein in The New York Times stating that such transactions should be “illegal on their face.”

The general theme among critics is that when management is involved in taking a company private, they face two, often contradictory, mandates: getting the highest price for their shareholders, and getting the lowest price for themselves and their co-investors.

Against this backdrop comes the recent disclosure that Richard Kinder, the chief executive of Kinder Morgan, waited three months to tell his company’s board that he was considering leading a buyout of the energy company. The deal, valued at more than $27 billion including assumed debt, is among the largest leveraged buyouts ever.

Private-Equity Funds Raise More Than $300 Billion

Oct. 3 (Bloomberg) -- Private-equity funds have gathered $300 billion this year, led by 13 buyout funds that account for about a third of the total, according to a report by Private Equity Intelligence Ltd.

Fund raising through Oct. 3 surpassed the $283 billion for all of 2005, London-based Private Equity Intelligence said in a report. Private equity includes buyout, venture-capital, real- estate and distressed-debt funds.

For Venture-Backed Firms, I.P.O. Chill Deepens

Things are not getting easier for venture-backed companies aspiring to go public. Just eight of these kinds of companies staged initial public offerings in the third quarter, raising $934.2 million. It was the slowest quarter for such I.P.O.’s since 2003, according to the Exit Poll report by Thomson Financial and the National Venture Capital Association.

The numbers mark “a significant decrease” from the previous quarter, when 17 companies went public and raised more than $2 billion, according to the report. In last year’s third quarter, 19 companies went public, raising $1.5 billion.

$15 Billion Deal for Harrah’s May Put Other Casinos Into Play

Their pockets bulging with cash, private equity firms have found a new business where they can place their multibillion-dollar bets: gambling.

Harrah’s Entertainment, the largest casino operator in the world, said yesterday that Apollo Management and the Texas Pacific Group had offered to acquire it for $15.05 billion in cash, or $81 a share. The announcement ignited speculation that the United States gambling business, whose thicket of regulations has traditionally kept investment firms at bay, could attract more such proposals.

Big Board Delays Plan on Voting

The New York Stock Exchange has quietly pushed back a plan that would prevent brokers from voting their clients’ shares in board elections when the stockholders have given no voting instructions of their own.

The plan, which was announced with fanfare in June, was supposed to go into effect in time for next spring’s shareholder meeting season. It would have halted a practice that helps entrench board members, critics say, because brokerage firms always vote for directors proposed by company management.

Hedge Fund Group Adds Lobbyist as Regulation Issue Looms

Federal filings made public last week show that the Managed Funds Association has hired a big-time Washington lobbying firm, Williams & Jensen, to help it with “legislation involving the registration of hedge funds.”

Some lawmakers are seeking tighter regulations on hedge funds in the wake of the recent meltdowns at Amaranth and Pirate Capital. The lobbyist was hired before either of those events, filings show, but Congress could be moving closer to enacting laws requiring registration of hedge-fund managers. An appeals court earlier this year struck down a Securities and Exchange Commission rule requiring registration.

Who Killed Amaranth? Suspects Abound.

Brian Hunter, the young energy trader at Amaranth, has taken much of the blame for the hedge fund’s implosion after his bets on natural gas blew up in his and his firm’s face last month.

Mr. Hunter’s huge trades worked for a while, but they also turned Amaranth into a one-strategy fund. But former hedge fund manager and current “Mad Money” host Jim Cramer, writing in New York magazine, says Mr. Hunter is “the wrong guy” to point fingers at. “I blame bigger villains,” he writes in an excoriation not only of the Amaranth case, but of hedge-fund investing in general.

Pension Funds File Access Proposal at H-P

Four pension funds this week submitted a resolution that seeks to allow shareholder-nominated candidates to run for seats on Hewlett-Packard's board of directors.

This was the first proxy access proposal filed after a Sept. 5 federal court ruling that the Securities and Exchange Commission improperly allowed American International Group to omit a 2005 access resolution by the American Federation of State, County, and Municipal Employees Pension Plan (AFSCME).

Professor Larry Sonsini: Corporate Law Flashback

Rep. Anna Eshoo, the congresswoman whose district encompasses Palo Alto, Calif. (where HP is headquartered), isn’t normally a member of this committee but was invited to participate. Unsurprisingly, given her jurisdiction, she’s expressed more sympathy toward Dunn’s and Sonsini’s situation than some of the other committee members.

Moments ago, Eshoo asked Sonsini about the problem of boardroom leaks. She asked what is out there today in terms of our laws to deal with a director who leaked confidential information?

Sonsini, whose initial authoritative baritone during opening statements had waned throughout the day, suddenly perked up. Instead of discussing pretexting for the umpteenth time, he could play the role of corporate law professor, something he’s done for years at Boalt Law School. It’s a very good question, he commended his congresswoman. First of all, he said, it’s important that boards continually evaluate themselves. Second, it’s important that boards adopt guidelines to deal with fiduciary duties.

But aren’t there laws to regulate this stuff, asked the congresswoman? “It’s corporate law,” said Professor Sonsini, with authority. Sonsini said that corporate law requires directors “to exercise due care,” and if they don’t ” they don’t get the protection of the business judgement rule.”

Stormy Times at Pirate Capital

Thursday brought more trouble on the hedge fund front, as CNBC’s David Faber reported that more than half of the investment professionals at Pirate Capital have left the firm. The reasons for the exodus were not clear, but Mr. Faber said at least some of the departures came after a meeting including Pirate’s analysts and the head of the firm, Thomas Hudson, “failed to address concerns [the analysts] had about the fund’s dealings with regulatory issues.” Earlier in the week, The Wall Street Journal reported that the Securities and Exchange Commission was investigating whether Norwalk, Conn.-based Pirate properly disclosed changes in its holdings in some publicly traded companies.

In a letter to investors, cited by Mr. Faber as well as Reuters, Mr. Hudson said the head of the firm’s fixed-income portfolio and two analysts had resigned, and that he had asked for the resignation of two other analysts.

Signs of Leaks, and Pre-Deal Profits, in Tech Mergers

Is the recent increase in deals in the technology sector being accompanied by a rise in inside tips?

A report from BernsteinResearch indicates that it may be. Bernstein analysts, examining the past 10 years, compared the five days preceding announcements of deals with the five days following them, and found that shares have bested the market in the pre-announcement period more often in the past two years than in the preceding eight. “This suggests wider availability of pre-deal information (intended and unintended),” according to the report.

From 1996 to 2003, seven percent of “outperformance” was captured before the announcement date, the report concluded. From 2004 to the present, that share has risen to 14 percent. The reasons for the difference are “unclear,” according to the report. One on hand, regulations have restricted information flows in recent years. But:

On the other hand, company use of the media, both intended and unintended, may be increasing with the goal of gaining some advantage in negotiations. In addition, the buy-side community, driven in part by the greater role of hedge funds, may be able to react faster to near-term trading opportunities.

H.P. General Counsel Resigns

Hewlett-Packard’s general counsel has resigned, the embattled computer maker said Thursday as current and former executives prepare to testify before a Congressional subcommittee about its controversial leak investigation.

Ann Baskins, a 24-year veteran of the company, is the fourth figure to resign from the company within the past week. Last Friday, C.E.O. Mark V. Hurd said that Patricia C. Dunn, the chairwoman who authorized efforts to find a leaker on the board of directors, had stepped down from the board of directors. On Tuesday, a spokesman said senior counsel Kevin Hunsaker and global security chief Anthony Gentilucci had left the firm.

Media reports have labeled the four figures as key players in the operation.

Private Equity’s Fees Are Too High, Pension Fund Says

Fees earned by buyout firms such as Blackstone Group and Texas Pacific Group are too high and could dampen their enthusiasm to make money for clients, according to the manager overseeing Britain’s largest corporate pension fund.

The 2 percent management fee typically charged by private equity companies is too much guaranteed income when a fund can be as large as $15 billion of assets, said Mark Anson, Chief Executive Officer of Hermes Pensions Management.

"Kobi" Alexander Apprehended in Namibia

BROOKLYN, NEW YORK – Roslynn R. Mauskopf, United States Attorney for the Eastern District of New York, and Mark J. Mershon, Assistant Director-in-Charge, Federal
Bureau of Investigation, New York Field Office, announced the arrest earlier today of fugitive JACOB "KOBI" ALEXANDER, former Chief Executive Officer of Comverse Technology Inc.,in Windhoek, Namibia. The arrest was made pursuant to a provisional warrant issued by a Namibian court at the request of the United States government. ALEXANDER will be brought before a court in Windhoek, Namibia within 48 hours. The United States intends to seek ALEXANDER’s extradition to the United States to stand trial on the charges set forth in an indictment, which was unsealed today at U.S. District Court in Brooklyn, New York.

Centerbridge’s Big Debut: a $3 Billion Buyout Fund

In a sign that investors continue to crave a piece of the private-equity pie, newly formed Centerbridge Partners has raised $3 billion for its first fund. The Financial News reported Wednesday that the sum is $500 million more than firm originally expected to collect in its fundraising debut.
Centerbridge’s new fund will invest in leveraged buyouts and distressed debt, or debt of financially troubled companies.

Insider Trading Alerts Rise

WASHINGTON, Sept. 26 (Reuters) — The New York Stock Exchange’s regulatory unit said Tuesday that it expected to refer 140 potential insider trading cases to the Securities and Exchange Commission this year, up 26 percent from 2005.
“The last two years have seen a significant increase in the number and complexity of our insider trading referrals,” said Robert A. Marchman, executive vice president of NYSE Regulation, a unit of the NYSE Group.
Hedge funds are part of a growing number of insider trading cases, Mr. Marchman told the Senate Judiciary Committee. The panel’s chairman, Arlen Specter, Republican of Pennsylvania, said more regulation of hedge funds should be considered.

Johnson & Johnson Sues Boston Scientific, Guidant and Abbott Laboratories Over Deal

Johnson & Johnson filed suit against Boston Scientific, Guidant and Abbott Laboratories for $5.5 billion in damages. The suit claims that the three companies illegally shared information on their way to scuttling Guidant's agreement to sell itself to Johnson & Johnson for about $21.5 billion.

KKR to unveil world's largest buyout fund

Global private equity house KKR is set to unveil the largest buyout fund of its kind anywhere in the world. KKR is close to raising $16.5bn (£8.7bn) for its 2006 fund, outstripping the nearest private equity fund by £900m.

Private Equity, Public Feuds

THE cozy world of private equity is about to become a lot less comfortable.
For a preview of the coming chill, consider the recent takeover battle for Freescale Semiconductor, a maker of chips for cellphones that was spun off from Motorola. Just hours before an alliance of four firms led by the Blackstone Group was to buy the company for $16 billion, another team of private equity firms, led by Kohlberg Kravis Roberts and Bain Capital, swooped in with a competing offer.
After a short but tense showdown, Blackstone won the contest after raising its bid at the 11th hour by 10 percent, to $17.6 billion.

The Rebirth of Venture Capitalism

Venture capitalists, who faded from the limelight after the bursting of the dot-com bubble, have been making a comeback with a global focus, says Bob Higgins, founder and managing general partner of Highland Capital Partners, a venture capital firm in Lexington, Mass., and a senior lecturer at the Harvard Business School.
In a conversation with The New York Times, Mr. Higgins says that while in the near term V.C.’s will continue to focus on conventional technology sectors, the Internet and biotech, there is a globalization occurring, which includes a movement into new sectors.

At Hewlett-Packard, a Chief Wounded by Divided Attention

Mr. Hurd, the chief executive, had wanted to talk about the transformation inside Hewlett-Packard, how it was becoming a lean Silicon Valley growth company instead of a cash cow content to thrive on the high profit margins of its ink and toner cartridges.
But instead, in his first public interview since the spying operation was revealed in early September, Mr. Hurd needed to talk first about the spying investigation that has sullied the company’s reputation as well as his own.

Head of Amaranth Says His Fund Will Hang On

The improbable happens.
That was part of the message from Nicholas Maounis, head of Amaranth Advisors, to investors in his battered hedge fund on Friday. Amaranth’s funds have lost $6 billion, or nearly two-thirds of their value, in recent weeks as once-profitable bets on natural-gas prices suddenly turned bad. The debacle has left Amaranth’s investors — many of whom face restrictions on when they can redeem their funds — desperate for information about the fate of their holdings.
On Friday afternoon, Mr. Maounis gave a much-anticipated update. In a brief conference call at 2 p.m. Eastern time, he said that his fund had every intention of staying in business and expressed regret for its recent losses — though he stopped of apologizing for the debacle. He took no questions from people on the call.
“We lost a lot of our own money this month,” he said. “We lost more of your money. We feel bad about losing our own money. We feel worse about losing your money.”
On the subject of Amaranth’s ill-fated energy trades, Mr. Maounis suggested that Amaranth was blindsided by a rare turn of events. “Sometime even the highly improbable happens,” he told investors. “That is what happened in September.”
The fund was hit especially hard on September 14, Mr. Maounis said. In that single day, the fund lost about $560 million on its natural-gas positions.
Many investors have asked for their money back, and Mr. Maounis said his firm had hired a lawyer from Skadden, Arps, Slate, Meagher & Flom to evaluate these requests. Still, he held out hope that investors would hang on. “We are determined to win back your faith,” Mr. Maounis said.

Warner Chilcott’s I.P.O. Prices Below Expected Range

The largest private-equity-backed initial public offering of the year made it out of the gate on Thursday, although the I.P.O. was smaller than expected.
Shares of drug maker Warner Chilcott Holdings priced at $15 apiece late Wednesday, below the forecast range of $17 to $19. The company sold 70.6 million shares, putting the value of the offering at $1.06 billion. Still, the price represented a heady profit — on paper, at least — for the company’s private equity sponsors, Bain Capital, DLJ Merchant Banking, J.P. Morgan Partners and Thomas H. Lee Partners. Regulatory filings show that these shareholders paid an average of just $5.77 a share for their stake in the company, which they took private in late 2004. About 31 percent of the company was sold in Thursday’s I.P.O.

At Los Angeles Times, a Civil Executive Rebellion

As Tribune faces the Chandler family at a board meeting Thursday, the newspaper industry is riveted by another skirmish inside the company: the growing rebellion at The Los Angeles Times.
After Jeffrey M. Johnson, the publisher of The Los Angeles Times, and Dean Baquet, the editor of the paper, openly defied their bosses at Tribune last week by refusing to make layoffs at the paper, Mr. Johnson was summoned to Chicago and spent Tuesday meeting with top executives.
Remarkably, however, Mr. Johnson and Mr. Baquet have not been fired. But while the crisis has been temporarily averted, it appears far from over.

As Icahn Wins ImClone Board Seat, A Fight Is Brewing

It was a win-some, lose-some day for Carl Icahn. ImClone Systems shareholders added Mr. Icahn and his slate of hand-picked nominees to the board, but the billionaire investor then lost a board vote to replace the current chairman.
Investors approved Mr. Icahn and two of his candidates today at ImClone’s annual meeting, setting the stage for a battle over who will manage the New York-based company. Later, the board refused to accede to Mr. Icahn’s demand that current chairman David Kies be replaced, voting to return him to the job.

Private Equity Flips Come Up Short, Study Finds

“Flipping” by private equity firms — defined as taking a company public within a year of acquiring it — fails to create long-term value for investors, according to a study cited Wednesday by The Financial Times. These initial public offerings tend to underperform other I.P.O.’s and the market as a whole, according to the study, by Josh Lerner of the Harvard Business School and Jerry Cao of Boston College.
Notably, though, the study also concluded that private-equity-backed I.P.O.’s as a whole tend to fare better than the broader market and more traditional offerings. It is just those taken public in less than 12 months that lag the market.

Shareholder suit accuses Tribune directors of 'suicide pill'

CHICAGO -- A shareholder lawsuit accused eight Tribune Co. directors Tuesday of trying to "maintain their dominion" over the big news media holding company with a stock repurchase plan it described as a "suicide pill" and other measures designed to ward off a takeover.

Hertz Adds Ford Bankruptcy Scenario to I.P.O. Filing

Apparently, Ford’s woes are worrying Hertz. In its latest amended prospectus, filed late Monday with the Securities and Exchange Commission, Hertz added several sentences describing how the car-rental company would fare if Ford should go bankrupt.
Such an event would have serious side effects for Hertz because of an agreement in which Ford will buy back used vehicles from Hertz at set prices.

A Hedge Fund’s Loss Rattles Nerves

Enormous losses at Amaranth Advisors, one of the nation's largest hedge funds, resurrected worries yesterday that major bets by these secretive, unregulated investment partnerships could create widespread financial disruptions. The scale of Amaranth's losses -- and how quickly they appear to have mounted -- was the talk of Wall Street, as was speculation on how much the bet was leveraged, or made on borrowed money. Still, there were no signs of ripples on the financial markets as a result.

A Ford-G.M. Merger?

Could the Big Three become the Big Two?
That is the far-fetched scenario raised Monday in the trade publication Automotive News, which reported that auto makers Ford and General Motors have discussed a merger or an alliance. Citing “several sources familiar with the talks,” the publication says the talks began soon after Nissan chief Carlos Ghosn suggested exploring a three-way alliance among Renault, Nissan and G.M. in July.

Blackstone Alliance to Buy Chip Maker for $17.6 Billion

In a rare buyout battle among the titans of private equity, the Blackstone Group has come away with a huge prize.
A Blackstone-led alliance that includes the Carlyle Group, Permira and the Texas Pacific Group announced yesterday that it had won the bidding for Freescale Semiconductor, a maker of chips for cellphones and cars, with a $17.6 billion deal. It is the largest leveraged buyout of a technology company ever, surpassing last year’s $11.3 billion buyout of SunGard Data Systems.

CA to face opposition from shareholders at Monday meeting

NEW YORK (Dow Jones/AP) -- Amid ongoing concerns about a declining stock price and financial-reporting errors, software maker CA Inc. faces opposition to members of the board and its independent auditor ahead of its annual shareholder meeting Monday.
Proxy advisery firms Institutional Shareholder Services and Glass Lewis & Co. are recommending shareholders withhold their votes for four CA directors including former U.S. Sen. Alfonse M. D'Amato. Glass Lewis is also recommending shareholders oppose the reappointment of CA's independent auditor, KPMG LLP, due to concerns about CA's recent financial restatements.

Justice Department Reviews Corporate Prosecution Rules

A Justice Department official on Tuesday defended the tactics used by federal prosecutors taking on corporations in the post-Enron era, but he also indicated that the agency might consider changes to the agency’s guidelines.
The comments by the official, Paul J. McNulty, a deputy attorney general, came before the Senate Judiciary Committee and were the first public response by a senior Justice Department official to mounting criticism from companies and lawyers that the tactics are being used as a bludgeon to force companies to cooperate with investigations.

Panel of Executives and Academics to Consider Regulation and Competitiveness

A committee filled with business leaders and academics was created yesterday to consider changes in the Sarbanes-Oxley Act and other laws and regulations governing securities markets and companies, with the intention of improving competitiveness for American markets.

The group, called the Committee on Capital Markets Regulation, has no official status but the announcement of its creation included praise from Treasury Secretary Henry M. Paulson Jr., who said that the issue of American competitiveness “is important to the future of the American economy and a priority for me.”

Hewlett-Packard Chairwoman Dunn Agrees to Step Down Next Year

Sept. 12 (Bloomberg) -- Hewlett-Packard Co. Chairwoman Patricia Dunn agreed to resign next year in an effort to diffuse a widening scandal surrounding the company's use of private investigators to access directors' phone records.
Chief Executive Officer Mark Hurd will take over as chairman of the world's second-largest personal computer maker in January, Palo Alto, California-based Hewlett-Packard said today in a statement distributed by Business Wire. Richard Hackborn will be lead independent director. Dunn will continue as a director.

Bristol-Myers' Dolan Resigns in U.S. Probe of 2005 Agreement

Sept. 12 (Bloomberg) -- Bristol-Myers Squibb Co. Chief Executive Officer Peter Dolan and the drugmaker's general counsel will resign after U.S. regulators called for their departures as part of a criminal investigation.
A federal monitor last night told the Bristol-Myers board that Dolan, 50, and General Counsel Richard Willard should be dismissed because their effort to protect sales of the company's top-selling heart pill Plavix broke the terms of a 2005 agreement that let the company avoid prosecution for inflating sales, said a person familiar with the investigation.

Earlier is Better for Venture Capital

So far, 2006 is shaping up as a very active year for early-stage companies to receive venture capital funding. According to the MoneyTree Report, a quarterly study put out by PricewaterhouseCoopers and the National Venture Capital Assn., 74 startup and seed companies raised money from venture investors during the second quarter of this year, up from 54 last year.

U.S. Attorney Begins Informal Inquiry into H-P Surveillance

Hewlett-Packard said Monday it has been ‘’informally contacted'’ by the U.S. Attorney’s Office concerning a company investigation into press leaks of confidential information.
The Palo Alto, Calif.-based maker of computers and printers said in a Securities and Exchange Commission filing that it is cooperating fully with the inquiry by the U.S. Attorney’s Office for the Northern District of California, along with an investigation by the California State Attorney General’s office, which requested similar information.

More merger reviews, fewer hurdles

The number of mergers reviewed by the federal antitrust agencies rose in 2005, but far fewer deals ran into trouble with regulators than in previous years.

Group Nears Record Deal for Chip Maker

A consortium of investment firms was near a deal late last night to acquire Freescale Semiconductor, a former unit of Motorola, for more than $16 billion, according to people briefed on the negotiations. The deal, if completed, would be the largest leveraged buyout ever in the technology sector, surpassing the $11.3 billion sale of SunGard Data Systems last year.

Court Decision Prompts S.E.C. to Revisit a Rule on Shareholder Proposals

A federal appeals court has at least temporarily cleared the way for shareholders to force companies to hold contested elections for directors, with rival candidates appearing on the ballots distributed by companies.
That is something that most companies strongly oppose. The Securities and Exchange Commission has until now allowed companies to refuse to allow shareholders to vote on such proposals.
The decision, issued Tuesday, led the commission to announce yesterday that it would take up the issue at a meeting on Oct. 18 and consider changing its rules. The S.E.C. chairman, Christopher C. Cox, did not say what action he favored, but promised that new rules would take effect in time for annual meetings in early 2007.

Riverside raises $250M

Riverside Co. said Thursday, Sept. 7, it has closed its submidmarket Riverside Micro-Cap Fund I at $250 million, sharply exceeding its initial $150 million target.
The fund will make majority stake purchases of North American micro-cap companies, businesses with annual revenues ranging from $5 million to $25 million and annual Ebitda of $3 million or less. It will aim to hold its investments for seven to 10 years, with the goal of increasing the companies' annual earnings to more than $10 million.

Congress Is Urged to Hold Off Acting on Options and Pay

WASHINGTON, Sept. 6 — With an eye toward the coming midterm elections, two Senate committees asked top government officials on Wednesday whether there was more Congress could do to clean up the options backdating scandal and rein in soaring executive pay.
What they heard was that legislative action was only part of the solution — and that, for now, lawmakers should stay out of the way.

Ex-Officials of Justice Dept. Oppose Prosecutors’ Tactic in Corporate Criminal Cases

group of former top Justice Department officials have asked the United States attorney general to curtail the tactics of federal prosecutors that encourage companies and people to disclose legal communications to avoid indictment.
The unusual request, in a letter delivered Tuesday to Attorney General Alberto R. Gonzales, is the latest attack upon prosecutorial guidelines that were adopted after the collapse of Enron and other corporate scandals. Any revision to the guidelines would change the way the government pursues white-collar cases.

Key to sell McDonald Investments in $280M deal

KeyCorp will sell its McDonald Investments branch network to New York City-based UBS Financial Services Inc. in a $280 million deal.
The deal, which is expected to close in first quarter 2007, involves only McDonald’s branch network. McDonald’s former institutional businesses, including investment banking, debt and equity capital markets, public finance and research, will remain part of KeyBanc Capital Markets.

M&A Backlog Hit Record High in August

There was a lull in completed mergers and acquisitions in August, but researchers at Merrill Lynch are offering a more upbeat way to look at the numbers. A recent report from Merrill’s brokerage analysts found that the backlog of announced but still-incomplete transactions hit a record high last month. The backlog now consists of deals with a total value of $8.5 billion, promising a hefty slug of fees for investment banks when those deals close.

H-P Leak Inquiry Draws Scrutiny

Hewlett-Packard’s chairwoman, Patricia Dunn, ordered monitoring of its directors’ phones to determine the source of news leaks, prompting a furor in which one director quit and another rebuffed efforts to oust him.
The dispute was laid out in a document that Hewlett-Packard filed Wednesday with the Securities and Exchange Commission. In the filing, H-P said that it had been “informally contacted by the attorney general of the state of California requesting information concerning the processes employed in the investigations into the leaks” and said it plans to “cooperate fully.”

California's Legislature Passes Majority Vote Bill: What Will Arnold Do?

Recently, the California legislature passed SB 1207 (Alarcon) to allow some California corporations to adopt a form of majority voting. California law currently requires plurality voting for California corporations. The bill was co-sponsored by CalPERS and CalSTRS. Unless Governor Schwarzenegger returns the bill before September 30, it will become law and take effect on January 1, 2007. Voting on the bill in both houses of the legislature was sharply divided and bill supporters and opponents are making opposite predictions on the likelihood of a veto by the Governor.

Pay Plan at Dana Ruled Illegal

A plan to pay millions of dollars to the top officials of the Dana Corporation, the auto parts company, violates the new bankruptcy law and cannot go forward, a judge ruled yesterday.
Judge Burton R. Lifland of the Federal Bankruptcy Court in Manhattan said that the proposal was an illegal plan to retain Dana’s chief executive and other top executives. The plan had drawn objections from Dana’s creditors, shareholders and unions, as well as the United States trustee, a part of the Justice Department.

Report Estimates the Costs of a Stock Options Scandal

A new study estimates that the stock options backdating scandal, which has touched more than a 100 companies, may cost shareholders hundreds of millions of dollars. The study was released on the eve of two Senate committee hearings that plan to examine the scope of the widening investigation into improper options practices.

On Buyouts, There Ought to Be a Law

The sizzling market for leveraged buyouts may be making headlines, but it may not be making money for investors in the companies being taken private, according to one critic of these deals. Writing in The New York Times, Ben Stein makes a case for why management-led buyouts should be stopped before any more shareholders get bilked.

Look Who's Left Standing

Four years after regulators launched a task force to stamp out business corruption, numerous chief executives are on their way to prison, two of the nation's biggest accounting firms are defunct or on probation, and investment banks have shelled out billions of dollars in settlements.
But lawyers serving fraud-ridden companies have emerged relatively unscathed.

The LBO Gang Storms the Valley

High-powered private-equity players are talking frustrated techies into the idea of going private—and making billions. Business Week OnLine

Graceful exits

The market for initial public offerings has virtually ground to a halt for venture-backed companies this summer, but it's still been a pretty good month for venture capital firms cashing out of portfolio companies, thanks to robust M&A activity.

Home Depot Alters Voting, but Critics Seek More Change

Home Depot, the largest United States home-improvement retailer, took another step yesterday to repair its image with investors after an acrimonious annual meeting in May, announcing that it had revised company bylaws to require that each director be elected by majority vote. But shareholders and corporate governance experts seem reluctant to stop pressing the company for further changes, including revisions in executive pay policies and director oversight.

Schering-Plough to Pay $435 Million, Plead Guilty to Settle Probe

Schering-Plough has agreed to pay $435 million and will plead guilty to conspiracy to settle a federal investigation into its drug sales and marketing practices and its clinical trial programs. The Kenilworth, N.J.-based company will pay $255 million to resolve civil aspects of the previously disclosed investigation. A subsidiary, Schering Sales, will pay a criminal fine of $180 million and plead guilty to one count of conspiracy under the agreement, which is subject to court approval.

London Regulator Widens Scrutiny of Hedge Fund Managers

London’s financial watchdog is increasing the number of hedge fund managers under supervision to monitor the growing influence of activist funds.
The Financial Services Authority said it was widening the number of hedge fund managers under supervision after reviewing the risk posed by activist funds to the markets.

Next for Nest Eggs: Hedge Fund Strategies?

Hedge-fund-like investments may soon be available to ordinary folks through — of all things — their retirement plans. So reports Alternative Investment News via DailyII.com, which tells us that some individual retirement accounts already allow investing in mutual funds that act like hedge funds, which are loosely regulated investment pools known for high returns, high risks and high fees. Some 401(k) plans may soon do the same.

Forbes: The Asbestos Game Goes On

Even as states crack down on frivolous lawsuits by people with no asbestos symptoms, asbestos trusts established by bankrupt manufacturers are still paying tens of thousands of claims each year based on exaggerated or false stories of how people were exposed to their products. Here’s the story from Forbes’s Dan Fisher.
But the trusts are overseen by plaintiffs’ lawyers, like Dallas firm Baron & Budd and New York firm Weitz & Luxenberg. So can’t they be counted on to weed out false claims?

M&A Remains The Most Popular Private Equity Exit

Mergers and acquisitions were the most popular way to get some money back for private equity firms in the U.S. in 2005, followed by dividend recapitalizations, according to a study by SCM Strategic Capital Management, a Swiss PE advisory firm.

Nonprosecution Agreement Doesn't Guarantee a Dodged Bullet

Most companies assume that they've successfully dodged a bullet when they sign a nonprosecution agreement with the government. That's certainly what shipping giant Stolt-Nielsen S.A. thought when its subsidiary struck a deal three years ago to avoid federal criminal charges for antitrust violations.
But shortly after the deal was concluded, the government said it would indict Stolt-Nielsen anyway because the company had broken the pact. Stolt-Nielsen maintains that the government is the one who isn't living up to the deal, and in July asked the U.S. Supreme Court to block the indictment.

Mass Torts & Class Actions: Going the Way of the Dodo?

Mass torts and class action lawsuits are on the wane, reported the Wall Street Journal’s Paul Davies in the Weekend Edition. “The future of mass torts and class actions is very much in question,” said NYU law professor Geoffrey Miller. Some reasons why:

The Milberg Weiss Effect: This year, new securities-fraud class-action lawsuits are down 45%, to 61 through June from 111 in the first half of 2005, according to a new study. (One reason: The indicted Milberg Weiss has filed just 17 lawsuits in the first six months of 2006, versus 55 in 2005’s first half — and hasn’t filed a class-action case since its indictment.)

The Controversial Silicosis Litigation: Federal Judge Janis Jack found last year that nearly 10,000 claims of lung damage from silica dust “were manufactured for money.” The case involved 200 companies that manufactured or used silica, which allegedly causes silicosis, an incurable lung disease. Judge Jack’s decision – detailed in this NPR feature – has also reportedly chilled asbestos litigation, which involves many of the same lawyers, doctors and plaintiffs.

Legislation: Congress passed a tort-reform bill earlier this year that makes it easier to move many class-actions from state to federal court, where judges are more likely to dismiss dubious claims. And several states – including Florida, Georgia and Texas – have passed “medical-criteria” bills, requiring physicians to certify a patient has been harmed by asbestos or silica, and not simply exposed, before a lawsuit can proceed.

Prudential’s Improper Fund Trading Called ‘Unprecedented’

Details of Prudential Financial’s $600 million settlement with regulators were released Monday afternoon, following several reports that a deal was in the works to resolve charges of improper trading in mutual funds.
Stephen Luparello, senior executive vice president at NASD, said, “The scale of the fraudulent market timing activity that was allowed to occur through this firm and that went unchecked by the firm’s supervisory systems is unprecedented.” The release stated that employees of Prudential’s former brokerage unit allowed improper trading in at least 1,600 customer accounts between 2001 and 2003.

Buyback Binge: Bane or Boon?

S&P 500 companies snapped up their own stock at record levels in the second quarter. For investors, the buyback boom means it's especially important to look beyond per-share earnings when evaluating a company's quarterly performance, analysts say. It might also be a reason to pay more attention to M&A prospects. However, buyback watchers don't expect companies to repeat the mistakes of the late-1990s rash of repurchases, which came back to haunt some stocks after the bull market went bust

U.S. Management-Led Buyouts On The Rise

An interesting piece by Caroline Humer ran on the Reuters wire a few days ago titled U.S. Management-Led Buyouts Soar. What's most astounding is her statistic on U.S. management buyouts.
"So far this year, $74.7 billion has been announced in U.S. management buyouts compared with $9.2 billion last year, accounting for more than 9 percent of U.S. merger and acquisition deals, up from 1.2 percent in the year earlier period. That growth also outpaces the growth in U.S. private equity and M&A overall, up151 percent and 25 percent respectively this year."

Prominent Corporate Lawyers Didn't Stop Shady Options Deals

A review by The Recorder of SEC filings for 17 companies that had prominent Silicon Valley lawyers serving as directors has uncovered questionable option grant dates for executives at five. While the grant patterns aren't necessarily evidence of wrongdoing, they do suggest that suspect pay practices at startups may be more commonplace than previously thought. They also raise new questions about what some name-brand lawyers knew, or should have known, in their roles as directors.

Who Signed Off on Those Options?

AS Silicon Valley companies competed for top talent during the heady days of the dot-com boom — luring stars with plump signing bonuses and the most highly prized manna of all, stock options — Mercury Interactive, a highflying software concern, joined the fray with gusto.

Whispers of Mergers Set Off Suspicious Trading

The boom in corporate mergers is creating concern that illicit trading ahead of deal announcements is becoming a systemic.
It is against the law to trade on inside information about an imminent merger, of course. roblem.
But an analysis of the nation’s biggest mergers over the last 12 months indicates that the securities of 41 percent of the companies receiving buyout bids exhibited abnormal and suspicious trading in the days and weeks before those deals became public. For those who bought shares during these periods of unusual trading, quick gains of as much as 40 percent were possible.

A Private Eye for Investors

As the number and size of hedge funds balloons, big investors -- funds of funds, pensions and family offices -- are increasingly turning to private investigators to test the waters before putting their money in.

New landscape may help Rite Aid

Rite Aid's announcement that it is paying $2.54 billion to buy nearly 2,000 drugstores carrying the Brooks and Eckerd names along the East Coast and Mid-Atlantic region is sure to get the attention of regulators at the Federal Trade Commission. While a review is likely, the deal is unlikely to suffer the same fate of a Rite Aid deal a decade ago, according to The Deal.

Is Google a Mutual Fund?

Companies whose securities comprise more than 40 percent of their assets can fall under restrictions that govern the mutual fund industry.

So Google, which has increased its cash and securities to almost $10 billion since its 2004 initial public offering, asked the Securities and Exchange Commission late last month for an exemption.

Share Buybacks Hit Record Level

Hear that giant sucking sound? Those are shares of stock being siphoned out of the market by companies buying them back. Standard & Poor’s on Wednesday announced that buybacks among companies in its S&P 500 index hit a record in the latest quarter and are continuing to grow at an unprecedented pace.

S&P also found that companies are now spending as much on stock buybacks as they are on capital expenditures. Companies in the information-technology sector are leading the buyback pack.

Fannie Mae Says It Will Avoid Prosecution

Fannie Mae, the mortgage finance company, said today it has been informed by the Department of Justice that no charges will be filed in connection with billions of dollars in accounting irregularities.
The company “has been advised by the United State’s Attorney’s Office for the District of Columbia … that it is discontinuing its investigation and does not plan to file charges,” said a statement from Fannie Mae today.

Deferred Prosecution Agreements On Trial

In light of Frank Quattrone’s sweetheart deal with the feds, The WSJ’s Laurie Cohen asks, “Do these ‘deferred-prosecution’ pacts have any teeth?”

Some legal commentators say the pacts don’t sufficiently punish wrongdoers and are simply face-saving mechanisms for prosecutors.

So which is it: Do deferred prosecution agreements secure “cooperation and real reform” or are they a toothless face-saving tool for prosecutors?

Bombshell Tax Decision From D.C. Circuit

The D.C. Circuit ruled Tuesday that the IRS may not tax the money plaintiffs receive as compensation for emotional distress and other intangible injuries. In striking down as unconstitutional Section 104(a)(2) of the Internal Revenue Code — which says that only compensation for physical injuries is tax-exempt — the court said, “Albert Einstein may have been correct that ‘[t]he hardest thing in the world to understand is the income tax,’ but it is not hard to understand that not all receipts of money are income.”

If the Supreme Court affirms or the agency adopts the court’s finding, plaintiffs nationwide will avoid paying taxes on awards in a myriad of cases, from civil-rights to employment-discrimination.

Icahn Reaches an Agreement With ImClone

The billionaire investor Carl C. Icahn said yesterday that he had reached an agreement with the biotechnology firm ImClone Systems to avoid a possible proxy contest.

In a filing with the Securities and Exchange Commission, Mr. Icahn said ImClone’s board offered to put him and three of his recommended candidates on the management slate of director nominees for the 2006 annual stockholders’ meeting, which is scheduled for Sept. 20.

Ford Motor considers going private

Ford Motor is considering taking itself private, USA Today reported Thursday, citing a source with direct knowledge of the discussions. Such a move would give the ailing automaker time to restructure operations outside the glare of critics. Meanwhile, Ford is also evaluating the prospects for alliances with other automakers as it moves ahead with its own revamping efforts, according to The New York Times.

Gateway Receives Bid After Hedge Fund Shines Spotlight

In just two days’ time, a hedge fund has managed to do for Gateway what its own earnings reports, pledges of growth in new markets and new C.E.O. haven’t been able to do for months: get investors to once again take notice of the nation’s No. 3 personal-computer company.
On Tuesday, shares of Gateway shares climbed as much as 12 percent after the disclosure by hedge fund Harbert Management that it has acquired 10.2 percent of Gateway’s outstanding stock.
And late Tuesday, Gateway said it received an unsolicited inquiry to acquire its retail operations from Lap Shun (John) Hui, owner of Joui International and a former owner of e-Machines.

A Change in Control: What Happens to the Executives?

One critical issue for an acquiring company in any proposed merger or acquisition is how to retain executives and key employees of the target. The introduction of a third party -- an acquirer -- into an employer-employee relationship can stress its bonds to the snapping point and generate a variety of reasons for an executive to want to leave.

Report Slams Options ‘Insta-Vesting’

Amid the recent scandal over the backdating of stock options, another options practice — a perfectly common and legal one — is also raising questions.
Jack Ciesielski, publisher of the Analyst’s Accounting Observer newsletter, has done an examination of accelerated options vesting, in which companies decide to make employee stock options instantly exercisable, scrapping the previously agreed-to waiting period. As reported Tuesday in The San Francisco Chronicle, he found 887 companies that accelerated vesting in the past two years.

Judge Approves Settlement for Former Banker Quattrone

The court on Tuesday signed off on a deal between prosecutors and Frank Quattrone that will allow the former investment banker to avoid a third trial on obstruction charges. Provided he does not break the law for a year, Mr. Quattrone, who was Credit Suisse’s star technology investment banker at the height of the Internet boom, will also be allowed to return to the financial sector. He admitted no wrongdoing under the deferred prosecution agreement.

HCA leveraged buyout gets US antitrust approval

U.S. antitrust authorities said on Monday they had approved one of the biggest buyouts in corporate history, giving the green light to a group of private equity firms to acquire No. 1 U.S. hospital operator HCA for about $21 billion in cash.

Harbinger seeks change in Gateway

Hedge fund Harbinger Capital Partners led a group that has bought a 10.2 percent stake in Gateway, saying it wants to install new management to revive the struggling PC maker.