"There's not a lot of emotion. It shows we can reach an agreement without strike deadlines." --- Chrysler Chairman Robert Eaton, after cordial talks with the United Auto Workers that resulted in a labor pactEDITED BY LARRY LIGHTReturn to top
PRINCE ALWALEED AND THE MUNCHKINS
WHY IS PRINCE ALWALEED following the Yellow Brick Road? The billionaire Saudi Arabian noble is involved in a plan to build a $440 million theme park in Kansas City, Kan., called the Wonderful World of Oz.
That's a departure from the prince's investment philosophy: to buy into well-known, if undervalued, ventures. Examples are the Four Seasons hotel chain, Saks Fifth Avenue, and Citicorp. On Sept. 25, he and Olympus Real Estate bought Boston's famed Copley Plaza Hotel for $72 million.
So it's unclear what the prince's attraction is to a theme park that hasn't been built. Pressed for details, all he says is: "It's moving ahead, but very slowly." The park, based on the classic movie The Wizard of Oz, was originally slated to open in 1997; that has been delayed to 2000.
Before the prince's arrival, the developers' five-year quest for capital had suffered because, for one thing, the 55-acre proposed park is not near a popular tourist destination. The prince has agreed to put up a substantial, undisclosed piece of the equity financing (which is half of the project's cost), say people close to the deal. His money will come in phases, hinging on the developers' meeting performance tests--municipal approvals, for instance.EDITED BY LARRY LIGHT By Lisa Sanders and John RossantReturn to top
WIRED'S TANGLED IPO
WIRED VENTURES is back on the Street with an initial stock offering. The money-losing publisher of Wired magazine and the online HotWired service, however, presents a prospectus that sounds like a cry for help.
Distress signals abound. The latest offering is smaller than the one pulled this summer ($66.5 million vs. $75.9 million). Wired now values itself at $251 million (at $12 per share), almost half what it did in June. The prospectus shows that Wired, which has never turned a profit, lost some $15 million on operations in just the first half of '96. That's more than in the previous three years combined and doesn't count an extra $20.5 million in losses from a write-off of some R&D costs.
Wired says it needs the $66.5 million in equity capital for new products, since more than 90% of revenue now comes from the magazine. The track record isn't reassuring. For instance, its TV program, The Netizen, was to debut last summer on MSNBC but has been shelved for now. The prospectus says the fresh equity will meet Wired's development needs through 1997, then it will need more capital. Wired, in registration, declined to comment. On the plus side, its stellar brand name may yet boost its fortunes.EDITED BY LARRY LIGHT By Andrew Ross SorkinReturn to top
RICHARD BRANSON'S AIR STRIKE
COLORFUL AS ALWAYS, Virgin Atlantic Airways CEO Richard Branson is out to shoot down the proposed alliance between British Airways and American Airlines. The slogan "No Way BA/AA" is painted on his 15 jetliners. Branson says he has spent $1.5 million, out of $15 million budgeted, for ads and lobbyists aimed at getting British and U.S. regulators to kill the deal. Other carriers are doing that, too, if less flamboyantly.
In recent British newspaper ads, which may come to America, Branson asked readers to play a game matching BA CEO Robert Ayling and American CEO Robert Crandall with a list of damning quotes. One from 1982 has Crandall suggesting to a rival that they raise fares in tandem 20%. (American dismisses the ad as raising "old issues.") The winner got two round trips to N.Y.EDITED BY LARRY LIGHT By Wendy ZellnerReturn to top