News

Recruiter Newsflash

The Harbus is pleased to offer this service in conjunction with Baker Library to brief you on the weekly business news highlights of the main HBS recruiters. The news is taken from The Wall Street Journal Interactive Edition and aims to provide a weekly summary of articles that can be followed up in greater depth. (Sources: WSJ- Wall Street Journal; DJ-Dow Jones News Wires)

Manufacturers
Alcoa Inc. (AA) is curtailing 70,000 metric tons a year of aluminum smelting production at its 204,000 metric tons a year Longview, Wash., facility immediately. In a press release Tuesday, the company said the decision to curtail production is in preparation of the sale of the Longview facility to Michigan Avenue Partners. The sale should be complete by the end of February. Terms were not given. As reported Dec. 27, European Union regulators had required Alcoa, the world’s largest aluminum concern, to sell at least 25% of its interest in Longview as a condition of its $4.5 billion acquisition of Reynolds Metals Co. (DJ 2/13/01)
The alliances struck by engine and truck makers Cummins Engine Co. (CUM), Navistar International Corp. (NAV) and Paccar Inc. (PCAR) are a step in the right direction, analysts said. The companies are suffering through a severe downturn in the U.S. truck market and the alliances will boost volume and allow the companies to cut costs. The alliances could even expand. “There’s the opportunity for all these deals to widen and deepen,” said analyst Thomas Burns of Dresdner Kleinworth. Cummins, the world’s largest producer of diesel engines, has agreed to a long-term deal to supply heavy-and medium-duty engines to truck maker Paccar. Navistar said it will build commercial trucks through a joint venture with Ford Motor Co.(F). (DJ 2/12/01)
Investors, start your engines! Fidelity Investments is teaming up with General Motors Corp. to let you check your portfolio and even trade stocks and mutual funds while you’re behind the wheel. Starting this spring, stock quotes and market information will be offered through the latest version of GM’s OnStar in-car communications system, available on new GM cars and trucks in the U.S. Trading and account features will roll out this summer. Fidelity officials describe the service as the latest in their effort to allow customers to manage their money whenever the spirit moves them. For the No. 1 auto maker, the deal is the first major endorsement of GM’s contention that by spending millions of dollars to wire cars with the system – which consists of a built-in cellphone and global-positioning-system equipment – it is creating a big group of subscribers of value to major companies outside the auto industry. (WSJ 2/14/01)

Entertainment
Amazon.com Inc. (AMZN) launched the Software Downloads Store, a store that allows customers to buy software programs and download them to their computers. In a press release Monday, Amazon.com said the store features search capabilities and customer reviews. The downloadable software is available 24 hours a day. (DJ 2/12/01)
Amazon.com Inc. plans to consolidate its European customer-service operations as part of the online retailing giant’s restructuring plan unveiled last month. Amazon said its current operations at The Hague, Netherlands, would be relocated to existing centers in Slough, United Kingdom, and Regensberg, Germany. The 240 employees at Hague location will be offered transfers to either of the other two operations. Amazon.com currently employs about 1,800 people in Europe, primarily in France, Germany and the U.K. (WSJ 2/12/01)
German media group Bertelsmann AG (G.BRT) will stick to its alliance with controversial Internet music file-sharing company Napster Inc. (X.NPS), Bertelsmann said late Monday. Andreas Schmidt, president and chief executive officer of Bertelsmann eCommerce Group said: “File-sharing is here to stay, and we will continue working to build a membership-based Napster service that will be supported by the music industry.” This was in response to Monday’s ruling by a U.S. Federal Appeals Court, which upheld much of a lower court’s decision holding Napster liable for copyright infringement. Observers widely consider the ruling a potential business-ending blow to Napster because it essentially would eliminate Napster’s main attraction: free access to copyrighted songs. Bertelsmann and Napster have developed a subscription-based business plan, with which it’s been trying to recruit other groups in the music industry beyond Bertelsmann’s BMG Entertainment. So far, they’ve only been able to enlist German independent music label Edel Music (G.EDL) and U.S. label TVT Records. (DJ 2/13/01)

Banks
Two top investment bankers at J.P. Morgan Chase & Co., the company created by the recent deal combining the former J.P. Morgan and Chase Manhattan, have resigned. Leaving the bank are Clayton Rose, 42 years old, the chief operating officer of the investment-banking division, and Joseph A. Walker, 46, a co-head of the mergers-and-acquisitions team. Mr. Rose said he is still considering his options, but ruled out joining a competitor. Mr. Walker will join General Motors Corp. as an adviser. (WSJ 2/9/01)
Merrill Lynch & Co. said Claudio Aguirre will become head of investment banking for Europe, Africa, and the Middle East, effective March 4. Mr. Aguirre, who becomes the dean of Spanish investment bankers in Europe, will oversee mergers and acquisitions and capital market activities for the region. Mr. Aguirre replaces Justin Dowley, 45 years old, and Huston McCollough, 49. Mr. Dowley is leaving to pursue outside interests and will be a senior advisor to Merrill Lynch. Mr. McCollough has requested a sabbatical leave and is expected to return to Merrill Lynch at some point. (WSJ 2/9/01)

Retail
Nike Golf, a unit of the athletic footwear maker Nike Inc. (NKE), acquired Impact Golf Technologies, a golf club developer, for an undisclosed amount. In a press release Friday, Nike said Impact Golf Technologies will focus on developing Nike golf prototype clubs for testing on the PGA Tour in 2001. (DJ 2/9/01)

High Tech
Dell Computer Corp., after slashing prices amid slowing growth in the personal-computer market, is gearing up for deep expense cuts that could include the first layoffs in its 16-year history. The Round Rock, Texas, computer company recently told managers to prepare for expense cuts of 8% to 10%, according to people familiar with the directive. The cuts would be on top of a series of moves intended to counter an industry slowdown. Dell already has frozen most hiring, barred travel unrelated to sales calls, and cut some marketing programs. A spokesman for Dell said he wasn’t aware of any broad reductions. (WSJ 2/9/01)

February 20, 2001
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