In a move analysts said may herald more charges by securities regulators, Richard Strong stepped down Tuesday as chairman and chief executive of Strong Financial Corp., and the company said he is divesting himself of majority voting control. New York State Attorney General Eliot Spitzer, who is probing the mutual-fund industry, has alleged that Strong made $600,000 in profits over five years through improper trades. In a separate move, Spitzer and the Securities and Exchange Commission charged Denver-based Invesco Funds and its chief executive, Raymond Cunningham, with civil fraud.
AT&T Corp. appointed William Hannigan as its president after Betsy Bernard resigned unexpectedly Tuesday. The nation's No. 1 long-distance telephone provider has been hurt by declining revenues. Chief executive David Dorman, however, attributed Bernard's departure to her desire to run a company, which "wasn't going to be AT&T in the short run." Hannigan, a longtime Dorman associate, most recently headed Sabre Holdings, a travel reservations service.
The $4.5 billion deal giving aluminum-producing giant Alcan control of rival Pechiney appeared complete after 92 percent of the latter's shareholders voted to accept it. Alcan's cash-and-stock offer finally was accepted by Pechiney administrators in September, although not until it had been raised in stages from the original $3.9 billion. Alcan, which is based in Montreal, said it would try to raise its stake to 95 percent, the level needed for a "squeeze out" of Pechiney's remaining shareholders, the Financial Times reported. Pechiney is based in Paris.
The parent of toy-store chain FAO Schwarz is filing for bankruptcy for the second time in a year. FAO Inc., based in King of Prussia, Pa., said Tuesday it will liquidate its Zany Brainy stores and may do the same for the rest of its 140 outlets if no buyer is found by Dec. 15. The stores are open in the meantime, but all sales are final.
Troubled Adelphia Communications Corp., the nation's fifth-largest cable TV provider, said it will shrink its 70 call centers to 11, cutting an unspecified number of jobs in the process. Adelphia filed for bankruptcy in June 2002 and has relocated from Coudersport, Pa., to suburban Denver, the center of the cable-TV industry.