EarthLink Network Inc. and MindSpring Enterprises Inc., two fast-growing providers of dial-up access to the Internet, are merging in a $1.7 billion stock swap to form a formidable rival to America Online Inc.
The new entity would have 3 million subscribers, eclipsing the 2.5 million users of AT&T online services and the 1.8 million who connect to the Web through Microsoft's MSN service. But it would still be far less than AOL's total of 20 million subscribers, which includes about 2 million accounts at its CompuServe unit.
In today's transaction, EarthLink stockholders will receive the equivalent of 1.615 MindSpring shares for each of their 32 million outstanding shares. MindSpring's stock closed at $32.87 1/2 a share Wednesday, giving the deal an initial value of about $53 per EarthLink share, or $1.7 billion overall.
Flood disrupts auto parts deliveries
DETROIT (AP) -- Flood-related problems at a parts company in North Carolina have created headaches at some auto factories in the United States and Canada, forcing automakers to cut production.
Workers at seven assembly plants owned by DaimlerChrysler AG and three owned by General Motors Corp. are working half-shifts due to a lack of a single part.
DaimlerChrysler said it was lacking a "suspension part," while GM said it was lacking a disc brake bracket.
GM spokesman Gerry Holmes said the slowdown was due to flooding problems at a Simpson Industries Inc. plant in Greenville, N.C.
Weekly jobless rate at 25-year low
WASHINGTON (AP) -- The number of Americans filing new claims for unemployment benefits fell last week to the lowest level in 25 years.
The Labor Department reported today that 272,000 Americans filed new claims for jobless benefits for the week ending Sept. 18, down by 17,000 from the previous week. That was the lowest level since Jan. 5, 1974, when claims were at 269,000.
Government officials say part of the sharp drop could have been because some unemployed who were affected by Hurricane Floyd were unable to get to claims offices.
U.S. firm to buy Japanese bank
TOKYO (AP) -- Japanese authorities plan to allow the transfer of troubled Long-Term Credit Bank of Japan Ltd. to U.S.-based Ripplewood Holdings, Japanese newspapers reported Thursday.
Japan's Financial Reconstruction Commission will officially decide on the transfer as early as Monday, the influential Nihon Keizai business daily said.
If completed, it would be the first takeover of a major Japanese bank by a foreign company, the nationally circulated Asahi newspaper reported.
To secure the deal, Ripplewood will buy up LTCB shares by paying $9.61 million to the Deposit Insurance Corp., the Japanese government finance body which is now LTCB's sole shareholder, the report said. Ripplewood will then pump $1.15 billion into the new LTCB, it said.
In other business news
United Technologies Corp. plans to reduce its worldwide work force by an additional 9,000 jobs as the company looks to reduce costs amid a downturn in the aerospace industry. The Hartford, Conn.-based company also announced Wednesday that it plans close 8.5 million square feet in manufacturing and other space. Most of those closures are expected overseas.
The Village Voice and seven other alternative weekly newspapers owned by real estate billionaire Leonard Stern are on the block. In addition to the Voice, which has a weekly circulation of 250,000, Stern Publishing also owns LA Weekly, Orange County Weekly, Seattle Weekly, City Pages in Minneapolis, the Cleveland Free Times and the Long Island Voice.
Phelps Dodge Corp. is adding almost $1 billion in cash to its previous all-stock bids for copper rivals Asarco Inc. and Cyprus Amax Minerals Co. In announcing the sweetened offer Wednesday, Douglas C. Yearley, the chairman and chief executive officer, said Phelps Dodge is willing to acquire one company without the other but is still hopeful a three-way deal can be worked out.
New York Life Insurance Co. plans to eliminate 800 positions or 9 percent of its work force in the next three years, the company said Wednesday. About 300 employees will lose their jobs in the next six months. The bulk of the layoffs will involve workers in the New York region.