Business digest 04/08/06
Judge: Delphi can buy out 13,000 workers
NEW YORK -- Auto parts maker Delphi Corp. can offer as many as 13,000 hourly employees lump sum payments of $35,000 to retire, a bankruptcy judge ruled Friday, marking a key milestone in its effort to scale back staff amid falling production. Troy, Mich.-based Delphi, one of the world's largest suppliers of auto parts, filed for bankruptcy protection in October and is trying to shed what it says are increasingly unsustainable labor agreements that have left it overstaffed and saddled with costly benefit programs. Judge Robert Drain, of the U.S. Bankruptcy Court in Manhattan, approved Delphi's plan to offer eligible employees a $35,000 lump sum payment in exchange for their retirement. The payments will be funded by former parent General Motors Corp., which agreed to do so under a broader labor deal.
Merck request to halt Vioxx hearing rejected
ATLANTIC CITY, N.J. -- A judge rejected on Friday a Merck & Co. lawyer's request that she halt a jury hearing on possible punitive damages for a former Vioxx user who had a heart attack after using the painkiller for four years. On Wednesday, the jury awarded John McDarby $3 million and his wife $1.5 million, saying Merck failed to warn of Vioxx's risks and that the company had misrepresented them to prescribing physicians. With jurors out of the courtroom on Friday, Merck lawyer Hope S. Freiwald told the judge that the jury shouldn't even get to deliberate on punitive damages because lawyers for McDarby had not made their case. But Superior Court Judge Carol Higbee denied the company's motion.
Japanese firms discuss next-generation phones
TOKYO -- Matsushita and NEC said Friday they are in talks with Texas Instruments Inc., a major maker of computer chips for handsets, about collaborating on next-generation cell phones. A major Japanese business daily, Nihon Keizai Shimbun, reported Friday that the companies plan to set up a joint venture in Japan as early as this summer to develop chips for third-generation cell phones. A spokesman for Matsushita Electric Industrial Co., Akira Kadota, and NEC spokeswoman Akiko Shikimori confirmed that talks were ongoing, but declined to confirm details of the joint venture. Nothing has been decided, they said.
Ford leader's pay dropped 40 percent
DETROIT -- Ford Motor Co. chairman and CEO Bill Ford received total compensation of $13.3 million in 2005, or 40 percent less than the previous year after the automaker's North American division lost more than $1 billion, according to a proxy statement filed Friday with federal regulators. The No. 2 U.S. automaker also said shareholders will vote on 10 proposals at Ford's annual meeting on May 11 in Wilmington, Del., including one that would remove sexual orientation from Ford's nondiscrimination policy and another that would tie executive compensation to progress in reducing greenhouse gas emissions from vehicles. Ford's management opposes both changes.
Brits selling 20 percent stake in Airbus
LONDON -- British defense and aerospace group BAE Systems PLC confirmed Friday that it is in discussions to sell its 20 percent stake in aircraft maker Airbus. BAE is negotiating with Franco-German group European Aeronautic Defense & Space Co., which owns the remaining 80 percent of Airbus, about the sale. EADS recently valued BAE's stake in the aircraft maker at $4.3 billion. BAE has long been expected to sell the Airbus holding as it focuses on building its presence in the giant U.S. defense market through acquisitions.
After sales turnaround, Burger King CEO resigns
MIAMI -- Burger King's chairman and chief executive resigned Friday after starting a turnaround at the No. 2 hamburger restaurant chain. Greg Brenneman, 44, is a veteran of fixing troubled companies, such as Continental Airlines Inc. in the 1990s. He joined Burger King in August 2004 amid nearly two years of slumping sales, but the chain says it's now had eight consecutive quarters of sales growth at stores open at least a year, and profits are small but growing. John Chidsey, 43, was promoted from president and chief financial officer to chief executive, effective immediately. He is the 11th CEO since 1989 at the company.
-- From wire reports