In Business This Week: Headliner
Paul Clayton: The Burger King Abdicates
After years of Whoppers and fries, Paul Clayton is switching to smoothies and juice. On Jan. 10, Clayton, 41, quit as president of Burger King's North American operations to become CEO of San Francisco's Jamba Juice. While shifting from a chain with 10,700 outlets to one with about 300 might seem humbling, Clayton says he "always wanted to join a small company in its early development phase." Someday, he predicts, privately held Jamba could rival his former employer.
Clayton is credited with turning around Burger King's U.S. operations by shifting the focus back to burgers during his three years at the helm. "There was a period when we were trying to sell pizza and shrimp," he says.
Now, he must persuade Americans to put down the Whopper and slurp a Kiwi-Berry Burner instead. "From a nutritional standpoint, the companies are different," concedes Jamba Juice founder and Chairman Kirk Perron, 35. "But Paul is a passionate guy who shares our vision." A Mango-A-Go-Go, anyone?By Diane Brady in New York; Edited by Mark FrankelReturn to top
Microsoft: To Split or Not to Split
Does the justice dept. want to break up Microsoft? On Jan. 12, the agency shot down a report that it wanted to split the company along the lines of its business units--with operating systems separate from applications, and possibly a third Net-related company. But two sources who have spoken to Justice lawyers told BUSINESS WEEK the feds are leaning toward a breakup remedy. That's because Justice is starting to conclude that behavioral remedies, barring specific market practices by Microsoft, won't work--since monitoring Microsoft's everyday conduct would be impractical. "They are floating ideas," says one well-connected industry source who has spoken to the government team.Edited by Mark FrankelReturn to top
Boeing Is Buzzing around Hughes
Boeing is ready to reach deeper into space. The leading maker of commercial aircraft is close to acquiring Hughes Electronics' satellite-manufacturing business for about $4 billion, sources close to Hughes said. "We want to focus on the expansion of high-growth satellite service businesses which are growing two to three times as fast as satellite manufacturing," a source said. The division, Hughes Space & Communications, had sales last year of $2.3 billion, about one-third of Hughes' total business.Edited by Mark FrankelReturn to top
Allstate Calls It a Day in Japan
Only months after opening its doors there, Allstate is leaving Japan. The Northbrook (Ill.) insurer plans to close its Japanese auto insurance business rather than invest in expansion at this point. "We didn't want to get far into it and have a big boatload of customers before making a decision," says spokesman Jim Dudas. The group has only sold about 950 contracts since setting up in northern Japan last April, and expected losses to continue as it built operations. But fiscal restraint is pre-empting expansion--two months ago, Allstate said it would save $600 million a year by cutting 4,000 job positions. So Japan will have to wait for the "good hands" people.Edited by Mark FrankelReturn to top