Business digest 09/01/05

MasterCard planning public offering of stock

NEW YORK -- MasterCard Inc., one of the world's largest credit-card brands, on Wednesday unveiled plans for an initial public offering to help reshape its business during a time of unprecedented competitive and legal challenges mounted by rivals. The Purchase, N.Y.-based credit-card association is controlled by 1,400 financial institutions that issue MasterCard-branded products. The IPO is expected in next year's first quarter, and will transfer a 49 percent equity stake and voting control into the hands of investors. The move comes as both MasterCard and larger rival Visa USA Inc. contend with a court decision that allows member banks -- for the first time -- to issue competing card brands.

Boeing braces for strike by 'insulted' machinists

SEATTLE -- Boeing Co. braced Wednesday for a strike at its commercial airplane operations after leaders of more than 18,000 machinists advised workers to reject a final contract offer they deemed "insulting." Hundreds of workers protested the company's offer, as Boeing provided its own take on the contract in an effort to shore up support for the offer. Union members will vote on the three-year offer today. Under union rules, the contract will automatically be ratified unless two-thirds of covered workers approve a strike. A tally is expected tonight. If a strike is approved, machinists would walk off the job hours later.

Freddic Mac earnings fall in 2005's first half

WASHINGTON -- The earnings of mortgage giant Freddie Mac dropped nearly 60 percent in the first half of the year amid continued volatile interest rates as it emerged from its accounting crisis. The second-largest U.S. buyer of home mortgages reported Wednesday that its net income fell to $1.64 billion, or $2.22 a share, in January-June from $4.07 billion, or $5.74 a share, in the same period last year. The government-sponsored company has been untangling a $5 billion misstatement of earnings -- mostly underreported -- for 2000-2002. McLean, Va.-based Freddie Mac had not turned in a quarterly financial report since it discovered the accounting problems in June 2003.

Credit-card shareholders approve takeover bid

SAN FRANCISCO -- Providian Financial Corp.'s shareholders on Wednesday accepted Washington Mutual Inc.'s $6.5 billion takeover bid, brushing aside concerns that one of the nation's last independent credit-card lenders could have been sold for a higher price. A total of 197.5 million Providian shares, or 67 percent of the common stock outstanding, supported the deal, clearing the way for Washington Mutual to complete the acquisition Oct. 1. San Francisco-based Providian announced the vote during a special meeting that ended several months of debate about whether Seattle-based Washington Mutual -- the nation's largest savings and loan -- is paying enough to buy a credit-card company that will help it diversify beyond home mortgages.

-- From wire reports