- The Washington Times - Tuesday, August 21, 2007


U The Securities and Exchange Commission sued Sentinel Management Group Inc., the cash-management firm that halted client withdrawals last week, charging Sentinel “defrauded its clients by improperly commingling, misappropriating and leveraging their securities without their knowledge.”

U William Poole, president of the St. Louis Federal Reserve bank, should resign after he said only a “calamity” would justify an interest-rate cut two days before the central bank lowered one of its lending rates, said Senate Budget Committee Chairman Kent Conrad, North Dakota Democrat. “Poole made a reckless, irresponsible statement,” Mr. Conrad said.

U Two ex-employees of Aegis Mortgage Corp. sued the bankrupt subprime lender for back wages, claiming they were fired without proper warning. Maricia Rommel and Lawonda Williams filed a complaint in U.S. Bankruptcy Court in Wilmington, Del., accusing the Houston-based company of failing to give workers at least 60 days’ notice before the Aug. 7 firings.

U KKR Financial Holdings, the Kohlberg Kravis Roberts & Co. affiliate, plans to raise $500 million by selling stock after being hurt by losses on residential mortgages. Investors including hedge-fund firm Farallon Capital Management and Morgan Stanley will invest $230 million, with the rest to come from to existing shareholders.

U SunTrust Banks said it will cut roughly 2,400 jobs, more than 7 percent of its total work force, by the end of next year. The Atlanta company said it will incur a one-time charge of $45 million in the third quarter to cover costs associated with the job cuts, which it described as a way to cut costs and boost shareholder value.

U The AFL-CIO, the umbrella group for U.S. labor unions, recommended that shareholders vote to approve the $32 billion private-equity buyout of TXU Corp., saying turmoil in the credit and equity markets makes it unlikely that investors will get a better offer for the Texas utility. Kohlberg Kravis Roberts & Co. and TPG are offering $69.25 per share for TXU.

U A federal appeals court said it needs more time to consider whether to block Whole Foods Market Inc.’s takeover of rival Wild Oats Markets Inc. The U.S. Court of Appeals for the District of Columbia Circuit temporarily put the $565 million deal on hold until it can hear more arguments.

U A federal judge in Illinois ordered DirecTV Group Inc., the nation’s largest satellite TV provider, to stop running ads that claim consumers and home-theater installers prefer the quality of satellite’s high-definition TV over cable’s. Comcast Corp. asked the court in July for a preliminary injunction as part of an ongoing legal battle.

U Viacom Inc.’s Paramount Pictures and DreamWorks Animation SKG Inc. will exclusively release movies using the HD DVD format, giving Toshiba Corp.’s high-definition standard traction against rival Blu-ray from Sony Corp.

U A two-day outage that left millions of Skype users unable to use the popular Internet phone service was caused by an abnormally high number of restarts after people had downloaded a Windows security update, the company said. Luxembourg-based Skype is owned by EBay Inc.

U Mattel Inc., the toy maker that recalled more than 20 million products this month for safety concerns, faces a lawsuit that seeks to force the company to pay for lead tests for children. The suit will be filed in Los Angeles Superior Court today, said Jeffrey Killino, of Philadelphia-based Woloshin & Killino, who will pursue class-action status.

U Bausch & Lomb Inc. said it settled a lawsuit with Alcon Laboratories Inc. involving an advertisement that may have given the impression Bausch & Lomb’s contact-lens solution increased the risk of eye infection. Alcon agreed to change a red and yellow grid used in promotional materials to represent the effects of Bausch & Lomb’s ReNu MultiPlus disinfecting solution.

U Nasdaq Stock Market Inc. said it has finally abandoned hope to acquire the London Stock Exchange and will sell its 31 percent in the British market to focus on a takeover battle for Sweden’s OMX AB, where it faces a challenge from Bourse Dubai.


U An investment vehicle run by London hedge fund manager Solent Capital Partners said it may be forced to sell mortgage-backed securities and other assets at a loss after failing to raise short-term funding in the commercial-paper market.

U French oil firm Total SA said it agreed to buy from Vietnam a 35 percent stake in a production-sharing contract for an offshore exploration block. Terms were not disclosed. PetroVietnam Exploration and Production will own 40 percent of the project, and SK Corp. of South Korea will own 25 percent.

U HSBC Holdings said it is in talks to buy a controlling stake in Korea Exchange Bank, currently held by U.S. private equity group Lone Star Funds. Pending legal cases surrounding Lone Star’s purchase of the bank in 2003 and a nationalistic backlash against foreign buyout funds have thus far prevented another sale of KEB.

From wire dispatches and staff reports

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