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Magna shareholders approve plan to buy out Stronach family


More than 75% of Magna International Inc.'s common shareholders approved a plan to pay about $1 billion to founder and chairman Frank Stronach, whose family would relinquish voting control of the company, the Associated Press reported.

Under the plan, which requires approval from the Ontario Superior Court, the global auto parts maker's dual-class share structure would be eliminated, and Stronach would give up his controlling class B super-voting shares, the AP article said.

In exchange, Stronach and his family will receive $300 million in cash, 9 million common A shares of Magna and control over a joint venture that will develop components for electric vehicles. Stronach will also receive an estimated $120 million in consulting fees, which will be gradually phased out by 2014. The Stronach Trust, consisting of Stronach and his family, would continue to own a minority stake in the company through the A shares it receives.

A statement issued by Magna said some shareholders plan to appear before the court to argue against the proposed transaction, AP reported.

Under the dual-class structure, the Stronach family has a 66% voting interest, although they do not have a majority equity stake, the report noted.

Magna co-CEO Don Walker said in May that the proposal to eliminate the Stronach family's voting control is meant to address shareholders' frustrations with what they view as an unreasonably low share price.

The Canada Pension Plan Investment Board, which owns about 1% of the company, said that although it is opposed to dual-class structures, it believes "the deal paid the founding Stronach family too much and would unfairly dilute shareholder value," the article said. (Source: Associated Press, July 23, 2010.)



Snyder’s of Hanover to merge with Lance Inc.

Family-owned Snyder's of Hanover, the U.S.'s largest pretzel company, based in Hanover, Pa., will merge with Charlotte, N.C.-based Lance Inc. to form a new entity called Snyder's-Lance Inc., the Philadelphia Inquirer's "PhillyInc" column reported.

The column noted that David V. Singer, president and CEO of Lance, would become CEO of the combined company. Snyder's president and CEO, Carl E. Lee Jr., would be president and chief operating officer. Michael A. Warehime, chairman of Snyder's and a member of the founding family, would be chairman of the board. Lance chairman W.J. Prezzano would be the lead independent director.

The merger would be a stock-for-stock deal with a value estimated by Inquirer columnist Mike Armstrong at $1.38 billion.

In November 2009, Snyder's attempt to buy another family-owned snack food company, Utz Quality Foods Inc., also of Hanover, Pa., fell apart when the Federal Trade Commission requested more details on the deal, the article said.

The Lance-Snyder's deal also must be approved by federal regulators but is expected to clear those hurdles, the report noted. (Source: "PhillyInc," Philadelphia Inquirer, July 23, 2010.)



Ikos co-founders’ divorce affects firm, staff

Martin Coward and Elena Ambrosiadou, a married couple who co-founded European hedge-fund firm Ikos in 1992, are in the midst of a contested divorce that is affecting the company, the Wall Street Journal reported.

Coward, who is British, was in charge of Ikos's comptuer programs and investment strategy; he has left the firm, which moved to Cyprus in 2007. Ambrosiadou, who is Greek, is the CEO and now runs the entire firm, the Journal article said. Ambrosiadou instituted divorce proceedings in Greece in April 2009.

They split partly over disagreements about how to manage the business, according to court filings and people who know the couple. In recent years, their bitter turf battle at Ikos has created a tense work environment, some people familiar with the mater claim and court filings show.

In June, the police got involved when Ambrosiadou claimed Coward was unlawfully using a private jet, which is owned by "a Cyprus company linked to a family trust with ties to Ikos," the Journal reported. Court filings report that Ambrosiadou fired Coward's London-based research team without his knowledge, the article said.

The battle has put pressure on the firm, which faces litigation involving former employees, including two who alleged they were dismissed unfairly, according to court records.

Some investors are worried about how the firm is being run, the article said. Assts under management fell by from their 2007 peak of about $3.4 billion to $1.4 billion in early 2009 and are now up to $1.95 billion, the Journal reported.

Peter Ho, one of the fired employees who reported to Coward, has filed an unfair-dismissal claim against an Ikos-related company with a U.K employment tribunal. The company and another Ikos-related unit has sued him for breach of contract in U.K. High Court. the Journal article said.

In court filings, Mr. Ho claims Ms. Ambrosiadou frequently interfered in Ikos's research and trading business, even though that was Mr. Coward's responsibility. Mr. Ho also alleges Ms. Ambrosiadou wanted to get rid of him at a time "of increased and unbearable tension between her and Martin Coward."

After the firings, a large Ikos investor called Coward and "explained that making such a significant move without consulting investors sent a negative signal about the company's predictability," the Journal report said. The person later withdrew his entire investment.

Ikos has since hired new staffers in research and technology, the article said. (Source: Wall Street Journal, July 26, 2010.)



Tuttle family will sell U.S.‘s oldest farm

Will Tuttle, 63, will sell his family farm, the Tuttle farm in Dover, N.H., which has been in the family since 1632, the Boston Globe reported. The farm is the U.S.'s oldest continually operating family farm and is No. 2 on Family Business Magazine's list of America's oldest family companies.

The farm was making a small profit until the recession, the Globe article said.

The 134-acre property, which is listed for $3.35 million, has been slowly surrounded by suburban homes and is bordered by a major street. It is protected by a conservation restriction that prohibits it from being developed after it is sold, and the Tuttles hold out hope that the new owners will maintain it as a working farm. But they are quick to acknowledge that, even with a new niche market for local produce, working a small farm these days can be a tough row to hoe.

The Tuttles plan to move to a home they own next door to the farm, the article said. Will Tuttle, who at age six began helping his grandfather on the farm, told the Globe: "fifty-seven years is enough. And I didn't want this to become a burden." (Source: Boston Globe, July 27, 2010.)



Ex-employee who embezzled unlikely to repay much to Koss

Sujata Sachdeva, who is expected to plead guilty in U.S. District Court to wire fraud for embezzling $34 million from her former employer, family-controlled Koss Corp., is unlikely to ever repay the full amount, the Business Journal of Milwaukee reported.

Sachdeva could be sentenced to five to 20 years in prison. The amount of restitution she pays will affect the sentence, the journal article said.

Federal agents already seized, between Dec. 30, 2009, and March 30, 2010, thousands of items Sachdeva bought with Koss funds.... They also will seize $269,334 in improvements and fixtures at the home she shares with her husband and two children.

After the sentencing, expected to take place in September, more than 22,000 items Sachdeva bought with the embezzled money -- including designer clothing, furs and jewelry, shoes and household goods, most never used or worn -- will be auctioned. Observers told the Business Journal that "the auction price will not produce proceeds near the retail prices Sachdeva paid."

Prosecutors have no plans to seek assets from Sachdeva's husband, from stores where she purchased the items or from charitable organizations to which she gave money, according to the report.

Koss has also filed a lawsuit against Sachdeva and the company's former outside auditor, Grant Thornton, the article said.

Two other unidentified former Koss staffers who allegedly helped Sachdeva commit her crime have not been charged. The Business Journal report said authorities are still investigating and would not comment on whether any other parties will face charges. (Source: Business Journal of Milwaukee, July 23, 2010.)



Santander pursues more growth

Santander, the Spanish bank has expanded extensively over the past ten years under the leadership of "charismatic" 75-year-old chairman Emilio Botín, the Financial Times reported. The bank's pre-tax profits reached 12 billion euros last year.

"Much of the bank's muscle-flexing growth has been achieved through aggressive dealmaking," the article said. It recently acquired 173 branches in Germany from SEB of Sweden and is expected to acquire 318 U.K. branches from Royal Bank of Scotland. It is also planning more acquisitions in Latin America and North America.

The FT report noted that the bank's stock "has fared no better than other Spanish banks, falling 15 per cent this year, and underperforming the European average by more than 10 per cent." The article said investors worry that Spain's economic problems, particularly the country's real estate bust and liquidity squeeze, will affect the bank.

The FT article pointed out "two interlinked challenges" for Santander:

First, how long can the sprightly but ageing Mr. Botín continue to lead the bank? Though he has a natural successor in Ana-Patricia Botín, his daughter and head of the group's Banesto subsidiary, she is relatively unproven. Second, can the bank maintain its frantic pace of acquisition-led growth without mishap?

A sidebar to the article said the bank's staff have an "almost cultish devotion" to Emilio Botín that "stems from a pervasive family business culture." The Botín family owns 2.1 per cent of the bank, the sidebar noted. Emilio Botín, who took over from his father, has been chairman since 1986.

... "I like it that Botín treats Santander like a family business," one investor says, "He cares about what happens to it."

(Source: Financial Times, July 22, 2010.)



Jane Lauder replaces her father on Estee Lauder board

Jane Lauder, granddaughter of the founder of Estée Lauder Companies, is replacing her father, Ronald, on the company's board of directors, according to a report on Cosmeticsdesign.com.

Ronald Lauder has served on the board since 1968. He will remain as chairman of Clinique Laboratories and an officer in Estée Lauder Companies, according to the report.

Jane Lauder will continue in her position as senior vice president and general manager of Origins, which she has held since 2008. She has been with the company since 1996.

She will take one of the four board seats reserved for family members, out of 13 total.

Also serving on the board are Aerin Lauder, senior vice president and creative director of the Estée Lauder brand; William P. Lauder, chairman of the board and executive director of the Estée Lauder Companies; and Leonard A. Lauder, chairman emeritus of the board. (Source: Cosemticsdesign.com, July 15, 2010.)



Shareholder files complaint against L’Oreal

An unnamed shareholder in L'Oréal has filed a legal complaint against the company, alleging "misuse of company funds" in awarding a ten-year artistic consultancy contract worth 405,000 euros a year to François-Marie Banier in 2002, the Financial Times reported. Banier, a "socialite photographer," is a friend of Liliane Bettencourt, the daughter of L'Oréal's founder and the company's largest shareholder.

Bettencourt's daughter, Françoise Bettencourt-Meyers, has sued Banier, alleging that he bilked her mother out of 1 billion euros in gifts. That trial was postponed on its opening day so the judge could investigate recordings made by a Bettencourt butler, which have had ramifications for French politicians, including President Nicolas Sarkozy.

The shareholder's complaint against the company "is being examined by Paris prosecutors," the FT article said.

It is the first time that the friendship between Mr. Banier and the 87-year-old Ms. Bettencourt .... has been linked to questions about the allocation of L'Oréal company funds.

(Source: Financial Times, July 21, 2010.)



Last family member to leave H&R Block board

Tom Bloch, son of one of the co-founders of H&R Block and the last family member to serve as the company's CEO, is leaving its board when his term expires Sept. 30, McClatchy Newspapers reported. No members of the founding family will remain on the board or in top management.

In a "blistering letter" to the board, the article said, Bloch

said he had become increasingly concerned about the "intense pressure" from shareholders for short-term gains and was increasingly in disagreement with the company's chairman, Richard Breeden. Bloch's letter expressed concern over price increases for the company's tax services and its "weakened competitiveness" in the online tax preparation market. He also lamented an "ill-timed" stock buyback program and the "staggering" loss of 2 million customers in two years.

The company's CEO, Russ Smyth, had resigned "abruptly" the week before, and the company also recently lost its general counsel and CFO, the report noted.

Bloch noted in his letter that the [company's] stock, which is down 35 percent this year, was one of the worst 2010 performers in the S&P 500.

Bloch, who spent 19 years with the company, became president in 1989 and CEO in 1992, the article said. He resigned in 1995 to pursue a teaching career. In 2000, the year he joined the H&R Block board, he became president of the board of University Academy, a Kansas City charter school he co-founded.

Bloch's father, Henry Bloch, told McClatchy Newspapers he planned to vote against keeping Breeden on the board.

Tom Bloch's letter to the board said the compensation of the new CEO, Alan Bennett, was overly generous and the company's 2010 financial plan is overly optimistic, according to the report.

... Bloch and Breeden have had differences on fundamental issues. Those include the price increases for tax preparation services, which Bloch said had outstripped inflation and had become a serious impediment to the tax offices' long-term success. he said the board should not tolerate plans that cause more erosion in market share and should not pursue short-term objectives that could hurt the company's long-term value.

(Source: McClatchy Newspapers, July 16, 2010.)



Bettencourt warns that L’Oreal could be takeover target

Liliane Bettencourt, L'Oréal's biggest shareholder, has warned that the company could be taken over by a foreign company as a result of her feud with her daughter, the Financial Times reported. Bettencourt, 87, has a 31% stake in the company, which was founded a century ago by her father, Eugène Schueller, the FT article said. According to the report, Bettencourt issued a statement that said:

"I hope my daughter will not destabilize the group which I and my father have wanted to be French."

A lawyer for Bettencourt's daughter, Françoise Bettencourt-Meyers, told the FT his client has no intention of selling her stake in L'Oréal.

The report noted that Nestlé, the giant Swiss food company,

has a 30 per cent stake and has said it will continue to act in cooperation with Ms. Bettencourt despite the expiry of their shareholder's pact last year, which prohibits Nestlé from increasing its shareholding during her lifetime.

Bettencourt-Meyers claims in a lawsuit that her mother was duped into giving a friend, François-Marie Banier, more than 1 billion euros.

A later FT report noted that L'Oréal shares are trading at a "significant premium."

The market reasoning is that if Ms. Bettencourt loses control of her stake, Nestlé might bid for the whole company and take it private because Ms. Bettencourt-Meyers is seen as less committed than her mother to the group.

(Sources: Financial Times, July 19, 2010; July 20, 2010.)

 



Chicago father sues son, seeking return of stock holdings

Daniel O'Brien Sr., 86, the founder of O'Brien's restaurant in Chicago, has filed a lawsuit accusing his son, Peter O'Brien, 54, of "improperly gaining control of the various family businesses, including real estate, nursing homes and the Whittaker Woods golf course in New Buffalo, Mich.," the Chicago Tribune reported. The suit seeks the return of stock holdings and other monetary damages, according to the report.

The two got into a dispute last year over an undisclosed issue at the golf course and have been unable to resolve their differences, according to the suit.... The allegations stem from estate planning Daniel O'Brien started in the early 1990s to transfer ownership of the business to his heirs that would minimize estate taxes when he and wife Mary died.

The senior O'Briens formed several limited partnerships and corporations and gave Peter minority interests in them, the Tribune report noted. Their estate planning goal was "to transfer ownership of the businesses over time but not control until they died," the article said.

The Tribune report said the suit alleges that Peter O'Brien, who acted as his parents' fiduciary, caused them to "execute written instruments that gratuitously transferred legal control of the family businesses to Peter" and that he concealed the "true nature" of the documents. Peter O'Brien's attorney denies the allegations, the article said. (Source: Chicago Tribune, July 19, 2010.)



Aecom Technology acquires Tishman Construction

Aecom Technology Corp., one of the world's largest engineering and design firms, has acquired Tishman Construction Corp. from the Tishman family for $245 million, the Wall Street Journal reported.

World-renowned Tishman projects include the original World Trade Center and MGM Mirage's CityCenter in Las Vegas. It is also handling the construction of One World Trade Center, expected to be the U.S.'s tallest building.

The Journal report noted that Aecom is a publicly traded company with $6 billion in annual revenues and 45,000 employees. Tishman is a closely held firm with about $1 billion in revenue. About 40% of its business is public-sector work, the report said.

Tishman was founded in New York in 1898 by the great-grandfather of the company's current chairman and chief executive, Daniel Tishman. Though connected decades ago, the company has no business relationship with Tishman Speyer Properties, the prominent landlord that has run into financial woes with some of its top-of-the-market real-estate deals. Another related company, Tishman Hotel & Realty LP, whose stable of properties includes the new Intercontinental New York Times Square, is also not part of the transaction.

Daniel Tishman will become a vice chairman of Aecom and a member of its board, the Journal reported. (Source: Wall Street Journal, July 15, 2010.)



SEC filing details Dolan’s jet lease deal with Cablevision

A Securities & Exchange Commission filing, Cablevision Systems Corp. reported that it has renewed a deal with Cablevision founder Charles Dolan to lease his Gulfstream GIV-SP back to the company, run primarily by his son Jim Dolan, for $600,000 a year, according to the Los Angeles Times' "Company Town" blog.

According to the SEC filing, the jet is technically leased by Sterling Aviation LLC, which is owned by Charles Dolan. Sterling then subleases the jet to Dolan Family Office LLC and Charles Dolan, and those entities lease the Gulfstream to CSC Transport, a subsidiary of Cablevision Systems Corp.

The LA Times blog also noted that the Dolans also lease a Cessna 501 back to themselves.

CSC Transport rents the Cessna from New York Aircam Corp., which is owned by Charles Dolan and his son Patrick, who is also a Cablevision executive. The price for that is $1,000 a month.

A Cablevision spokeswoman told the LA Times that the company's "use of aircraft is absolutely appropriate and, at times, essential." (Source: "Company Town," Los Angeles Times, July 14, 2010.)



Report: No rivalry over Swatch Group chairmanship

Nayla Hayek, 59, was "the surprise choice" to succeed her larger-than-life father, the late Nicolas Hayek, as chairman of Swatch Group, the Financial Times noted in its "World View" column.

Many had expected the chairmanship to go to Ms. Hayek's younger brother Nick who, though also in his father's shadow, is perceived to have performed soundly since being appointed chief executive in 2003. Although a board member since 1995, and ostensibly responsible within the group for the Middle East, Ms. Hayek is better known as an equestrian and horse breeder than a salesperson or manager.

The report noted that "Fears of family upsets appear to have been misplaced."

[H]er brother described the appointment as entirely logical, given his sister had this year been promoted to become one of her father's two deputies. Moreover, analysts noted that Nick, 55, had also been granted board membership at the same time..... Ms. Hayek's appointment came primarily because it corresponded to with her father's wishes.

(Source: "World View," Financial Times, July 14, 2010.)



Arbitration panel favors AB InBev over Modelo

An arbitration panel ruled that the merger that created Anheuser-Busch InBev did not violate an agreement with Grupo Modelo and that AB InBev's 50.2% controlling stake in Modelo is legitimate, according to news reports.

Reuters noted that AB InBev's 50.2% stake in Modelo gives it 44% of the voting rights; the other 56% "remains in the hands of Modelo's controlling families."

A report in the St. Louis Business Journal said that Modelo had sought $2.5 billion in damages and had sought to prevent Anheuser-Busch Cos. from selling its stake in Modelo to InBev. Modelo had argued that Anheuser "had breached a 15-year-old investment agreement by failing to consult the Mexican company on Anheuser-Busch's sale" to InBev, the Wall Street Journal reported.

According to news reports, analysts predict AB InBev will try to take a controlling stake in Modelo. The Financial Times cited a research report from Barclays Capital that said:

"The end of the arbitration theoretically opens the possibility for talks, as clearly the two groups were waiting for this to be resolved before moving in any direction."

The Wall Street Journal report noted that "it is unclear whether the Mexican families who control Grupo Modelo would sell their shares." (Sources: St. Louis Business Journal, July 12, 2010; Wall Street Journal, July 13, 2010, Reuters, July 12, 2010; Financial Times, July 13, 2010.)



Police raid Bettencourt’s family investment office, adviser’s home

Police raided the family investment office of L'Oréal heiress Liliane Bettencourt and the home of her financial adviser on July 9, the Financial Times reported.

The raids on the home of Patrice de Maistre, financial adviser to Ms. Bettencourt, and the Clymène office -- the Bettencourt family investment office run by Mr. de Maistre -- are part of an investigation into alleged illegal campaign payments by Ms. Bettencourt and André Bettencourt, her late husband, to politicians, including [French president Nicolas] Sarkozy.

De Maistre's lawyer said his client denied allegations -- since partially retracted -- by a former bookkeeper of Bettencourt's that she and her husband routinely withdrew money for illegal donations, the article said. Bettencourt's lawyer also has denied the allegations, according to the FT report. (Source: Financial Times, July 9, 2010.)



Hugh Hefner wants to take Playboy private

Playboy Enterprises founder Hugh Hefner has offered to buy the company's remaining shares in a deal that would take the company private, the Associated Press reported.

Hefner owns 69.5% of Playboy's Class A stock and 27.7% of its Class B shares, the report noted. His proposal said he was discussing a partnership with private equity firm Rizvi Traverse Management.

Playboy's board cautioned shareholders that no decisions have been made regarding the proposal. If the proposal moves forward, the board said that it would form a committee of independent directors to consider its merits.  

The Chicago Tribune noted that FriendFinder Networks Inc., which owns the rival Penthouse adult franchise, is preparing a competing bid for Playboy and that other companies might also bid for the company. 

The Tribune noted that last year, Hefner blocked competing bids from Iconix Brand Group Inc. and a former Playboy executive. The report said:

Playboy said in a statement that Hefner told the board of directors he was not interested in any sale or merger of Playboy and was not talking with other partners besides Rizvi.

The Tribune report said the Playboy brand has great potential and that since 2009, when media veteran Scott Flanders replaced Hefner's daughter Christie as CEO, "the company has been outsourcing operations and shedding employees to transform itself from a publisher into a brand management company."

A Tribune editorial said that "what once was known ad the Playboy empire is less than it was -- and ultimately Hef has no one to blame but ... Hef."

Even before the Internet changed the economics of the media world, Playboy operated more like a private company than a public one. Hef's heavy stockholdings let him control it, and the high expenses of running his California mansion and supporting his cherished magazine made little business sense. For years, his daughter Christie served as chief executive, and only after the stock price dwindled to almost nothing at the end of 2008 did she step aside, to be replaced by an outsider.

The Tribune editorial noted that Hugh Hefner has said he wants to pass the company on to his young sons, Marston and Cooper.

(Source: Associated Press, July 12, 2010; Chicago Tribune, July 12, 2010.)



Brown family, Wilbur Ross and others invest $100 million in Sun Bancorp

The Brown family, who are the largest shareholders in Sun Bancorp, joined with billionaire Wilbur Ross and others to invest a combined $100 million into the bank, the Philadelphia Business Journal reported. Sun, based in Vineland, N.J., will use the money to "strengthen and expand current operations as well as pursue growth opportunities throughout New Jersey," the article said.

Ross, who invested $50 million, now owns a 25% stake in the company. The Browns invested $30 million; other investors contributed $20 million, according to the report.

The journal article said that Bernard A. Brown, 84, has been chairman of the board at Sun since the company was founded in 1985. His children Ike Brown, Sidney R. Brown, Anne E. Koons and Jeffrey S. Brown are directors. Sidney Brown, 52, is Sun's vice chairman. Bernard Brown also is chairman of NFI, a Vineland trucking conglomerate; Sidney Brown is NFI's CEO.

Prior to the Ross transaction, the top institutional shareholders in Sun are Dimensional Fund Advisors, Vanguard Group and BlackRock Institutional trust Co., according to the report. (Source: Philadelphia Business Journal, July 8, 2010.)



Political fallout from Bettencourt lawsuit

A former bookkeeper in Liliane Bettencourt's household claimed Bettencourt had contributed 150,000 euros in cash to French President Nicolas Sarkozy's 2007 election campaign, the Financial Times reported. Bettencourt is the daughter of the founder of cosmetics company L'Oréal.

[T]he latest allegations are particularly serious because under French law, individual political donations must not exceed 7,500 euros a year. [The bookkeeper] also claims that Mr. Sarkozy regularly received envelopes of cash when he came to dine at the Bettencourt mansion in Neuilly, an upmarket suburb of Paris where the president was mayor between 1988 and 2002.

An analysis in the FT's "World View" column said the allegations "risk destabilizing the company" in addition to raising a government scandal. Bettencourt is involved in a legal battle with daughter, Françoise Bettencourt-Meyers, who alleges that her mother's companion, François-Marie Banier, bilked Bettencourt out of nearly 1 billion euros. Allegations that Bettencourt's fortune may have avoided scrutiny by the tax authorities because of her political connections have surfaced as a result of the lawsuit. The "World View" analysis said:

So far, Mrs. Bettencourt and her daughter at least seem to agree on one issue. They both claim to be committed to L'Oréal and have no intention of parting with control. But in the current poisonous climate, there are no guarantees that control will not ultimately change and that one or other of the Bettencourts decides to sell out. In turn, L'Oréal's other dominant shareholder, the Swiss food multinational Nestlé, must be watching developments with discomfort.

(Source: Financial Times, July 6, 2010.)



Founder’s daughter named Swatch chairman

Nayla Hayek, daughter of Swatch Group AG founder Nicholas G. Hayek, was named to succeed her father as chairman two days after his death, the Wall Street Journal reported.

Nayla Hayek had been vice president of Swatch's eight-member board and was elected chairman in a unanimous vote, the report noted. Her brother, Nick Hayek, is Swatch's CEO and is also a board member.

Niayla Hayek joined Swatch's board in 1995, the Journal report said.

"[She] has focused on promotional activities and taken responsibility for the local organization in Dubai and India and for luxury brand Bahrain.... She also took over the operational leadership of a watch-making partnership Swatch formed with Tiffany & Co....."

(Source: Wall Street Journal, July 1, 2010.)



Washington Post rejects two bidders for Newsweek

The Washington Post Company, which put Newsweek up for sale in May, told two suitors that their bids would not be considered, the New York Times reported.

The two rejected bidders were Newsmax, a monthly conservative magazine, and Thane Ritchie, an Illinois hedge fund manager, according to the report.

With no shortage of interested parties, the issue for the Post Company has become whether it can find a new owner that the company's chairman and chief executive, Donald E. Graham, believes will be a suitable steward for the magazine. That is the main reason the Post Company decided not to entertain offers from Newsmax or Mr. Ritchie, according to [sources]. The conservative political ideology of Newsmax's chief executive, Christopher Ruddy, is at odds with the editorial bent of Newsweek, which strives to be apolitical in its news coverage though is often criticized as left-leaning. And Mr. Ritchie ... is viewed as more libertarian in his political views. He has explored creating a third political party in Illinois with supporters of Ross Perot.

(Source: New York Times, June 30, 2010.)



Ford pays preferred stock dividends

Ford Motor Co. has caught up on payment preferred stock dividends, which it had skipped for 14 months, and may resume common stock payouts by 2012 -- a year ahead of previous predictions, Bloomberg reported.

The company must pay off more of its debt, which totals about $27 billion, before it can resume the common stock dividend, the report noted.

Ford removed a key legal hurdle to the divident by paying $255 million in deferred dividends on its Capital Trust II preferred stock, along with a $3.8 billion payment to a trust for union retirees. Now that those dividends are paid in full and restored, Ford is free to reinstate a dividend on its common shares and Class B shares owned by the Ford family. The size of the payments -- made ahead of schedule -- shows the carmaker is confident it can generate cash. 

(Source: Bloomberg, July 1, 2010.)



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