Slimmer Divi but Siemens Is Solid as Ever

At its last meeting, Siemen's stockholders learned that the dividend was to be reduced. For awhile, this reduction caused panic for investors already jittery because of the pressure the German market came under after the stock market crash. Despite this reduction, which was linked to profit performance, the dividend compares favorably with the net dividend paid before the system was changed. Mergers and acquisitions continue to play an important part in the company strategy -- with the US as an attractive target -- because it is the largest electrical market in the world. Further, joint ventures continue to be a part of worldwide strategy; recently, Westinghouse Electric and Siemens formed a company by deciding to combine their factory automation operations. While borrowing requirements for this huge firm are few, foreign subsidiaries do use the capital markets. Approximately half of the sales are international, with about 70% in Europe.

Full text: Euromoney, Jul 1988

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Rite Aid Stock Falls on Bribe Charge

Carolyn J. Lukensmeyer, Governor [Richard F. Celeste]'s chief of staff, said Rite Aid representatives and pharmacy board officials met on March 28 with Richard Murray, a Celeste aide, ''to work out business details related to the transfer of ownership.'' She said there was no mention of an appointment to the board at the meeting. But she said a board staff member had said then that Rite Aid had told Mr. [Melvin Wilczynski] its ''monetary proposal included an agreement that Wilczynski resign from the pharmacy board.'' Walter Loeb at Morgan Stanley said ''some people are speculating that there could be a takeover or buyout of Rite Aid'' if the Ohio charges lead to changes in the company's management. He added, ''In my opinion, this is disruptive but not necessarily a negative long-term situation.''

Full text: New York Times, May 2, 1989

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CEO Addresses Stockholders Commercial Federal 'To Stick to Basics'

"The basics have always been at the heart of our business, and we think that there is no better time to get back to them," William A. Fitzgerald told about 150 people at the Omaha company's annual stockholders meeting. Stockholders asked three questions during the 30-minute meeting, held at the Holiday Inn at 72nd and Grover Streets: will Commercial Federal be profitable in fiscal 1990-91; can the company raise $70 million in new capital by next June 30; and why is the stock price so much lower than its book value. The company's $32 million loss in fiscal 1990 was caused by a $47 million addition to reserves for possible loan losses, Fitzgerald said, a step caused by new federal regulations governing S&Ls.Addition to Reserves

Full text: Omaha World - Herald, Nov 20, 1990

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Ballard makes money each time he gets sick

Still, the question of redeveloping the site for a new Maple Leaf Gardens and an office or commercial centre after [Harold Ballard] dies is far from settled. November '86: Amid rumors that Ballard's health is failing, Toronto investor [Morton Shulman] announces he has been accumulating Gardens shares. Stock trades as high as $169 from $141 (this is before the 5-for-1 split). Star photo (Spremo) Harold Ballard at Maple Leaf Gardens; chart stock prices for Maple Leaf Gardens 1987-1988

Full text: Toronto Star, Aug 12, 1988

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How a Real Estate Highflier Flamed Out

Residential Resources Mortgage Investments Corp., a Phoenix, Arizona, real estate investment trust (REIT), is in a Phoenix bankruptcy court just 6 months after its $68.6-million initial public offering. Residential's investments are in residuals, i.e., volatile byproducts of complex mortgage financings that could become practically worthless if interest rates rose. If Residential's lenders prevail in bankruptcy court, investors could be wiped out. Residential's founder and former chairman, James C. Marshall, helped transform bundles of mortgages into precise instruments through use of the collateralized mortgage obligation (CMO), which fixed a flaw in traditional mortgage securities, such as those from the Government National Mortgage Association (Ginnie Mae). In a CMO, the Ginnie Maes are pooled to back bonds that are designed to return principal at fairly regular intervals. As competition heated up, the CMO business was being driven by residuals. The complexity of the residuals led traders to call them the "toxic waste" of the mortgage business. When interest rates rose in December 1988 and pushed down the market price of residuals, Residential was forced into bankruptcy court.

Full text: Business Week, Mar 6, 1989

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GTECH Chief Rebuts Critics at Meeting of Shareholders

PROVIDENCE -- Frustration over GTECH Corp.'s shrinking profits and sliding stock price boiled over yesterday at the company's annual meeting. Guy B. Snowden, chairman and chief executive officer of GTECH, the world's largest lottery system manufacturer, spent 45 minutes at the Providence Marriott lectern defending everything from the generosity of executive salaries and perks to the efficacy of lending directors money at low interest so they can buy company stock. "It would appear to me, Mr. Snowden, that with the losses GTECH has incurred (from discontinued subsidiaries), with the stock price down to $10.25 this morning, and looking at the increases in compensation" outlined in the company prospectus, "that this management team is benefiting at a time when the earnings of this company are nil," said one shareholder, Eugene A. Nadeau of Warwick. (excerpt)

Full text: Providence Journal, Aug 11, 1988

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Tell trade gripe to the exchange

Full text: Houston Chronicle (pre-1997 Fulltext), Oct 15, 1990

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Communications takeover derby paces stock gain

Stock prices gained ground for the second straight day Wednesday in a hectic session energized by two enormous takeover bids in the communications industry. The Dow Jones average of 30 industrials climbed 16.00, to 2512.32, on top of Tuesday's 15.62-point rise. Advancing issues outnumbered decliners by about 9 to 5 on the New York Stock Exchange, as volume swelled to 213.71 million shares from 187.57 million Tuesday. "It's hard not to be bullish," said Travelers Investment Management senior trader Susan Del Signore. "There's good action in several stocks." The bond market also showed strength, with prices generally rising.

Full text: Chicago Tribune (pre-1997 Fulltext), Jun 8, 1989

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ConAgra Raises Bid For Holly

ConAgra Inc. has increased its bid to acquire Holly Farms Corp. by $144 million, the Omaha-based firm announced Sunday. Under the new agreement, ConAgra would pay a total of $1.346 billion - at existing stock prices - to acquire Memphis-based Holly Farms. The agreement came after negotiations broke down over the weekend between ConAgra and Tyson Foods Inc. of Springdale, Ark. - the two firms battling to take over Holly Farms. Under the new agreement, Holly Farms stockholders would receive 2.1 shares of ConAgra common stock for each of their Holly Farms shares. Based on ConAgra's closing price Friday of $35.625, that would make each share worth $74.81.

Full text: Omaha World - Herald, May 22, 1989

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The Influence of Estimation Period News Events on Standardized Market Model Prediction Errors

It is hypothesized in many accounting and finance research studies that the news release has valuation implications. Based on an examination of firm-specific news reported in the 1983 Wall Street Journal Index, it is demonstrated that the distribution of Wall Street Journal news-conditional residual returns is different from the distribution of returns when such news is absent. This finding leads to a proposition of a news-conditional model of the process that generates security returns as an alternative to models that are commonly used in previous event studies. Results suggest that standardized prediction errors and squared standardized prediction errors from the news-conditional model have a tendency to be larger in absolute value than those created from a conventional market model.

Full text: The Accounting Review, Jul 1988

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