In the Region
Coventry Health unit to take over for Aetna in St. Louis
Coventry Health Care Inc. of Bethesda announced yesterday a deal in which its subsidiary, Group Health Plan, will be the replacement carrier for Aetna Inc. in the St. Louis market, which Aetna has decided to leave.
Aetna has about 70,000 members in the St. Louis area. Coventry has 270,000 members in its Group Health Plan and another 130,000 in a Medicaid HMO. It has 1.7 million members altogether in about a dozen markets, and has been seeking growth through acquisition.
Aetna has agreed to recommend Group Health Plan to its customers. Coventry said it would pay a "nominal" fee for each Aetna member who joins Coventry as Aetna contracts expire, but precise terms of the deal were not disclosed.
Downtown Partnership to tout city at convention
The Downtown Partnership of Baltimore Inc. will pitch the city to retailers and developers next week at the International Conference of Shopping Centers in Las Vegas. Gov. Parris N. Glendening will deliver the conference's keynote address.
Representatives of the business organization said they will use new marketing materials to promote the city at the nation's largest shopping center convention. They will share a booth with Williams Jackson Ewing Inc., the Baltimore developers of urban retail and restoration projects such as Grand Central Terminal in New York.
The partnership also plans to do a market feasibility study that will give retailers and developers a picture of the potential for developing Baltimore's downtown.
City pollution-control firm wins 2 foreign contracts
Environmental Elements Corp., a Baltimore pollution-control company, said yesterday that it has been awarded two contracts totaling $8.5 million from TXU Europe Power Ltd., which operates power plants in the United Kingdom.
EEC, which had sales of $61 million for the fiscal year 2001 that ended in March, will upgrade electrostatic precipitators, which remove emissions such as dust and fly ash, at two plants.
The contracts support EEC's plan to expand its services business instead of focusing so heavily on the installation of new devices, as it had in the past.
Two sheriffs' departments to use Aether equipment
Aether Systems Inc. of Owings Mills has won a contract to provide its wireless communications systems for sheriff departments in Oklahoma and Tennessee.
The law enforcement agencies bought a system that will allow them to communicate when they don't want to share information via frequencies monitored by radio scanners, such as when tracking fugitives. The sheriffs' offices are in Oklahoma City and in Knox County, Tenn.
Aether also said Intermec Technologies Corp., a subsidiary of UNOVA Inc., will use the company's new software to link wireless communications systems and technologies. Intermec, of Everett, Wash., develops supply chain management systems.
Merger overhaul cost to AOL Time Warner called about $1 billion
AOL Time Warner Inc. estimated that the cost of reorganizing its businesses after merging will be about $965 million, with more than half from job cuts, a U.S. Securities and Exchange Commission filing showed.
About $565 million of the costs pertain to eliminating jobs and about $400 million to lease and contract-termination costs, the world's largest media and Internet company said.
AOL Time Warner, formed from America Online Inc.'s $124 billion acquisition of Time Warner Inc., is reducing its work force and selling assets to meet its goal of $11 billion in cash flow this year. Since the merger, the company has eliminated 2,400 jobs, or 2.8 percent of its 85,000 workers.
Safeco insurance to fire 450 in reorganization
Safeco Corp., the property-casualty insurer whose shares have fallen 19 percent this year, said it will fire about 450 employees and transfer other jobs as the company overhauls its business insurance operation.
The Seattle insurer said the overhaul will help it concentrate on the small- to medium-size business insurance market.
A separate unit to underwrite larger accounts will be created, though the company said it expects large business volume to decrease.
United's business jet unit is cleared for takeoff
United Airlines has cleared its new business jet subsidiary for takeoff, after it was approved yesterday by the board of its parent company, UAL Corp.
The world's No. 2 carrier said it expects to have a fleet of about 200 executive jets in the air by 2005. The new unit will initially be based on fractional ownership, an arrangement in which clients buy a portion of the planes and pay operating fees in exchange for a guaranteed number of flying hours per year.
Socially responsible fund sells its Wal-Mart shares
The largest socially responsible mutual fund has sold its shares of Wal-Mart Stores Inc., citing sweatshop conditions at overseas factories run by vendors to the world's biggest retailer.
KLD & Co. removed the Bentonville, Ark., retailer from its Domini 400 Social Index on Feb. 1. The $1.4 billion Domini Social Equity Fund, which tracks the index, sold the shares, the Boston firm said yesterday. "Wal-Mart hasn't done enough to ensure that vendors meet adequate labor and human rights standards," KLD said in a statement. KLD provides research for institutional investors on how companies treat employees and the environment.
A Wal-Mart spokesman said the company tries to do business only with factories that are run legally and ethically.
Merrill Lynch proposes raising pay of brokers
Merrill Lynch & Co. Inc. has proposed increasing brokers' pay, seeking to catch up with higher-paying rivals and shore up earnings in its biggest division.
Merrill, whose approximately 15,000 U.S. brokers constitute the biggest such group, may raise commissions from 46 percent to 51 percent of the revenue generated from fee-based accounts. Brokers also will get a 5 percent bonus on money collected in asset-priced accounts between June and September.
The changes are part of efforts to make the unit more profitable by encouraging services that generate predictable fees instead of those that vary with the markets.
Home-decor retailer files for Chapter 11 bankruptcy
Home-decor retailer Tandycrafts Inc. has filed for Chapter 11 bankruptcy protection after it failed to refinance its debt or get an extension on its credit.
Tandycrafts, once a member of the same corporate family as RadioShack, lost $19.7 million last year and it stock plunged from $26 per share in 1993 to below $1 before it was delisted last week by the New York Stock Exchange.
The company, based in Fort Worth, Texas, filed for bankruptcy protection Tuesday in U.S. Bankruptcy Court in Delaware, saying it owed about $32 million in secured debt to Wells Fargo and Bank One. Tandycrafts listed $64.6 million in assets and nearly $53.4 million in liabilities in its bankruptcy petition.
IP is nearly done moving headquarters 12 miles
International Paper Co., the world's largest paper company, will complete the relocation of its headquarters from Purchase, N.Y., to nearby Stamford, Conn., this weekend, a spokesman said.
International Paper is moving into a downtown building that housed Champion International Corp., which IP acquired last year. The 12-mile move came after Connecticut state officials offered a package of financial incentives.
This column was compiled from reports by Sun staff writers, the Associated Press, Bloomberg News and Reuters.