In The Region
Independence of Korn/Ferry is questioned
The Fair Care Foundation, a Washington-based group that opposes the proposed sale of CareFirst BlueCross BlueShield, has questioned the independence of one of the consultants studying the proposed deal.
In a letter made public yesterday, Richard L. Hubbard, a lawyer for the Fair Care group, said the group believes that Korn/Ferry International, a consultant to District of Columbia regulators on CareFirst's executive compensation, "in the past has conducted executive searches for both CareFirst and WellPoint," the company seeking to acquire the Owings Mills-based CareFirst. "The last search for CareFirst occurred in 2002," the letter said.
"We think these officials ought to really probe and find out what these relationships have been in the past," Hubbard said yesterday.
CareFirst spokeswoman Ann T. Gallant said the company would have no comment on the letter. Ken Ferber, a WellPoint spokesman, said Korn/Ferry had done no work for WellPoint in 2002 but may have done some in 2001. Spokesmen for Korn/Ferry, the D.C. Insurance Commissioner and the D.C. Office of Corporation Counsel could not be reached for comment yesterday.
Elsewhere
Japan's big banks pressured to toughen bad-loan accounting
Japan's financial watchdog intensified pressure on major banks yesterday to reassess their bad loans using tougher Western-style accounting rules - a step that could sharply increase the size of the debt crippling the banking sector.
The Financial Services Agency said it would ask, but wouldn't require, the five largest banks to adopt a method known as discounted cash flow to calculate their bad loans by the March 31 end of the fiscal year.
The method would force many banks to lower the value of their loans and other assets now valued according to potential returns. It could also expose more sour loans.
Under the new bank minister, Heizo Takenaka, the government has been trying to rid the banks of a mountain of debt that has strangled the world's second-largest economy. Economists say Japan must resolve banks' bad debts before it can recover from a decade-long slowdown.
Court declines to revive Pepsi suit against Coke
PepsiCo Inc. lost a bid to revive a lawsuit that accused rival Coca-Cola Co. of violating antitrust laws by forcing distributors to sell only the world's largest soft-drink maker's drinks to retailers.
A two-judge appeals panel in New York affirmed U.S. District Judge Loretta Preska's September 2000 ruling dismissing the suit brought by the No. 2 soft-drink maker, which claimed that Coca-Cola committed antitrust violations by barring its independent distributors - which supply restaurant and movie theater chains and other food-service outlets - from selling Pepsi.
Pepsi contended in the 1998 suit that Coca-Cola was seeking to illegally dominate the market for fountain-dispensed drinks by enforcing a loyalty agreement with independent distributors.
France Telecom to sell Dutch TV unit for cash
France Telecom, under pressure to reduce its massive debt load, said yesterday that it had agreed to sell its Dutch television unit Casema Holding to three firms for $677 million in cash.
The sale to the Carlyle Group, Providence Equity Partners and GMT Communications Partners should be completed before the end of January, the French telecommunications operator said in a statement.
France Telecom said part of the proceeds - $160 million - will be allocated to paying back Casema's debt. Net gains will amount to $527 million, said France Telecom, which is struggling under $72 billion of debt.
This column was compiled from reports by Sun staff writers, the Associated Press and Bloomberg News.