"I would only say to anybody else who has a birthday today, `Happy birthday. You can have mine."'
--Bob Dole, upon turning 73 on July 22EDITED BY LARRY LIGHTReturn to top
ADM TO THE SEC: IGNORE OUR SHAREHOLDERS
ARCHER DANIELS MIDLAND, which pleased institutional investors by revamping its board, now is asking the SEC to derail four big investors' proposed reforms. To their outrage, ADM seeks approval to omit three of their proposals from the October annual meeting's proxy statement.
Just recently, the shareholders were welcoming ADM's efforts to overhaul the 17-member board they considered too close to Chairman Dwayne Andreas. This spring, the agribusiness giant--under federal investigation for alleged price-fixing--said it would remove executive directors, other than Andreas, and appoint three outside members. A good start but not enough, say the four investors, who represent 10 million shares.
The California Public Employee Retirement System and the Florida Retirement System Trust Fund both call for a majority of independent directors. The New York City Fire Dept. Pension Fund wants confidential voting for directors. The United Brotherhood of Carpenters Pension Fund wants to hold directors liable for "gross negligence."
ADM calls its SEC move "an ordinary legal step," and hopes to work a deal with investors.EDITED BY LARRY LIGHT By Richard MelcherReturn to top
UNCLE SAM MAY PLAY SCROOGE WITH BONDS
THE FEDS MIGHT MAKE YOUR nice tax-exempt muni taxable next year. This stems from the IRS's quest for money it says it's owed by municipal-bond issuers, such as states and towns. The IRS said in a July 19 ruling if the municipalities don't cough up the money in a year, it may yank their paper's exemption. One estimate: $1 billion is owed.
A big chunk of the muni universe may be at risk: $426 billion in bonds issued since 1989 (of a total $1.2 trillion). The issuers say they're not to blame and point to their Wall Street underwriters. The fracas centers on the practice of municipalities taking funds raised by muni sales and investing it temporarily in Treasury securities. But in some cases, the feds suspect underwriters overcharged for the Treasuries--that's the money the IRS seeks. To date, the IRS hasn't publicly named any firms.
By threatening to yank the tax exemption of muni bonds, the IRS is apparently pressuring the issuers to get the money from the Wall Street firms. The feds believe that the issuers will be successful, so bondholders won't be hurt.EDITED BY LARRY LIGHT By Leah Nathans SpiroReturn to top
A `RENT' STRIKE IN HOLLYWOOD?
BIDDING FOR MOVIE RIGHTS to Broadway's Rent has its share of drama, too. Bidders have dwindled, with Danny DeVito's Jersey Films the latest to quit. But sources close to the action say Rent will still bag up to $5 million, a lot in a time when movie musicals aren't common.
Why have four of eight bidders split since April? Maybe it's the pickiness of the sellers: the late playwright Jona- than Larson's family, which won't comment. It fears a movie of Rent, set among artsy East Village vagabonds, won't be true to his vision. It vetoed Peter Guber's Mandalay Entertainment, concerned his Rent would be too Hollywood, a source says. Mandalay says bidding got too high, so it quit.
The auction has dismayed several studios. "It's not a gift certificate redeemable whenever they want it," says a Hollywood executive bidding for Rent. Now, some production outfits aren't sure Rent is mainstream enough. Still in the game: 20th Century Fox, Warner Bros., New Line, and Robert De Niro's Tribeca.EDITED BY LARRY LIGHT By Andrew Ross SorkinReturn to top