BUSINESS BRIEFS
3 more global banks settle probe of securities sales
Advertiser Staff and News Services
NEW YORK — Merrill Lynch & Co., Goldman Sachs Group Inc. and Deutsche Bank yesterday joined other major financial companies in settling with regulators over their roles in selling risky auction-rate securities to retail investors.
The agreements bring to eight the number of global banks that have settled the five-month probe into claims they misled customers into believing the investments were safe. New York Attorney General Andrew Cuomo, leading the investigation on behalf of state and federal authorities, has now reached deals to buy back $57 billion worth of auction-rate securities.
Cuomo said yesterday he is far from finished in examining both large and small players in the market, and said the investigation will intensify against Bank of America Corp. He also warned that the investigation might shift its attention to individual brokers and bank employees who sold the investments.
CANDYMAKER MARS RAISING PRICES
HARRISBURG, Pa. — The maker of Snickers bars and M&Ms candies said it is raising wholesale prices on various items to offset the higher costs of raw materials, packaging and energy, the second major candy company in the past week to announce such a move.
The statement issued this week by Mars follows a similar announcement by its rival The Hershey Co., which cited the spiraling costs of everything from cocoa and peanuts to fuel and utilities.
The privately held Mars did not say which products will go up in price, or by how much. But it said the majority of the price increases will take effect Oct. 17.
INDEX SHOWS BIG DROP IN ECONOMY
NEW YORK — A private sector measure of the economy's health showed the largest drop in a year, and while new jobless claims fell for the second straight week, they remain near the highest levels since 2002. The reports are the latest evidence the languishing American economy remains stuck in low gear.
The New York-based Conference Board said yesterday its monthly forecast of future economic activity fell 0.7 percent in July, far more than the consensus estimate of a 0.2 percent decline by Wall Street economists surveyed by Thomson/IFR.
The last time the index showed a drop this great was last August, when it fell by 1 percent.
RISING COSTS WEIGH ON HEINZ, HORMEL
MILWAUKEE — Rising commodity costs kept weighing on foodmakers H.J. Heinz Co. and Hormel Foods Corp. in the most recent quarter, even as consumers continued to swallow price increases for their favorite foods.
Hormel Foods, the maker of Spam and Jennie-O Turkey, said yesterday that its fiscal third-quarter profit fell 9 percent as higher meat, fuel and other costs outweighed price increases and hurt margins. But revenue was up 10 percent, helped in part by the higher prices charged to customers.
H.J. Heinz's fiscal first-quarter profit rose 11 percent, fueled by double-digit sales growth in North America and Europe. The company, which is also facing higher commodity costs, raised prices an average of 5.2 percent across all its product lines, including Heinz Ketchup, Weight Watchers Smart Ones products and Ore-Ida potatoes, to try to keep profits strong.
3 INVESTORS PUSH FOR NAPSTER SALE
LOS ANGELES — Three investors are launching a fight to get elected to the board of Napster Inc. so they can push for a sale of the West Hollywood, Calif.-based digital music company.
Their campaign platform: Napster's current management is incompetent and busy enriching itself. The company, which has been on the block before, should try harder to find a buyer.
"Napster should be exploring all possible avenues of maximizing stockholder value which includes the possible sale or merger of the company," the investors said yesterday in a letter filed with the Securities and Exchange Commission. "The actions taken by the current board have made that option extremely difficult for potential acquirers."
