Andrew Lack is joining that rarefied club of newsies who ascend to the top of TV networks. In an announcement that surprised some in the broadcasting industry, NBC said on May 8 that Lack, president of its news division, will become president of the entire network.
The 53-year-old former documentary producer will assume the role from Robert Wright, who will remain CEO of NBC but spend more time at parent company General Electric (GE). Wright will be assisting Jeffrey Immelt as he gets ready to take on the Herculean task of filling the shoes of legendary GE CEO Jack Welch.
Lack's appointment might just signal that Welch is now ready to cut short what had already been a prolonged exit after GE's pending bid for Honeywell (HON). That means Immelt might take the helm by summer's end rather than at the end of the year, GE insiders say.
As for Lack, NBC is hoping he can do for its sagging prime-time lineup what he did for the No. 1-rated Today show and NBC Nightly News with Tom Brokaw. Will Northrop Grumman's (NOC) hostile, $2.1 billion cash-and-stock bid for Newport News Shipbuilding (NNS) on May 8 upend General Dynamics' (GD) friendly, all-cash offer for the same amount? It depends on how the Bush Administration answers some broad policy questions about the defense industry's health. Los Angeles-based Northrop Grumman gripes that the General Dynamics deal would let GD monopolize nuclear shipbuilding capabilities. General Dynamics, based in Falls Church, Va., contends there isn't enough demand for more than one nuclear shipbuilder, and the military could save billions from consolidation. In choosing savings or competition, the Pentagon may have to forgo the help of two top officials with potential conflicts of interest: Navy Secretary-designate Gordon England, a former GD executive, and Air Force Secretary-designate James Roche, a Northrop Grumman exec. Although gas prices are soaring, refiners seem more interested in buying one another than in adding capacity. On May 7, Valero Energy (VLO) announced plans to acquire its San Antonio neighbor, Ultramar Diamond Shamrock (UDS), for $3.9 billion. It would become the nation's second-biggest refiner after Exxon Mobil (XOM). Just three months ago, Phillips Petroleum (P) agreed to buy Tosco (TOS), the biggest independent U.S. refiner. Valero Chairman and CEO William Greehey says he expects trustbusters' approval because the companies' operations don't overlap much, and their combined bulk would help them get cheaper crude oil, lowering prices for consumers. Two of the top business schools in the U.S.--both based in metro Chicago--have new deans. The University of Chicago on May 8 named Edward Snyder dean of its graduate B-school, a day after crosstown rival Northwestern University elevated Associate Dean Dipak Jain to head its Kellogg Graduate School of Management. Jain, 43, a marketing professor at Kellogg, replaces Donald Jacobs, who retired after 26 years at the helm. Chicago's Snyder, 47, who takes over from Robert Hamada, had been dean of the University of Virginia's Darden School. Chalk up another win for Ciena (CIEN), a small Linthicum (Md.)-based maker of optical networking products that has been gaining ground against optical giant Nortel Networks (NT). On May 8, Ciena said that it snagged a two-year deal valued at more than $150 million to supply optical switching and transport systems to TyCom. The Bermuda-based carrier will use Ciena's products to build an undersea optical network that will link six continents. Auto makers had a disappointing April, with industry sales down 10%. But it wasn't for lack of trying. Rebates and other incentives jumped 11.4% from the year before--and 9.5% from March--to an average $1,825 per vehicle. Sport utilities, minivans, and pickups had the best deals, averaging nearly $2,000 per vehicle. While great for buyers, it will hurt carmakers' profit margins. It used to be that only domestic auto companies offered rebates and low-cost financing options. But in April, Japanese brands sharply pumped up their incentives, with help from a weak yen. Forced to keep up with the incentives, Detroit's Big Three are in for a painful period of lower earnings. -- California regulators want to raise industrial electricity rates as much as 50%.
-- J&J (JNJ) has offered $1.3 billion for Inverness Medical's (IMA) diabetes-care business.
-- Merrill Lynch (MER) will cut its investment management unit workforce by 20%, to 3,600. Rite Aid (RAD) shares surged 13%, to $8.10, on May 8 after the struggling drugstore chain reported a smaller-than-expected fiscal fourth-quarter loss. Investors were buoyed, analysts say, because the results indicate that Rite Aid can easily meet its hefty debt obligations. Indeed, on May 9, credit-rating agency Standard & Poor's changed its outlook on Rite Aid bonds from negative to positive, and the stock moved up another 5.4%, to $8.54.