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Times Co. will sell regional newspapers

The New York Times Co. announced that it has agreed to sell its Regional Media Group to Halifax Media Holdings of Daytona Beach, Fla., for $143 million, the New York Times reported.

Media analyst Ken Doctor told the Times that he thinks the sale price is "incredibly low."

The Times article also noted that the company has been criticized by the local Newspaper Guild for freezing pension benefits for non-U.S. employees and its proposal to freeze pension benefits for other New York Times employees. An open letter to company chairman Arthur Sulzberger Jr. asking the company to change its pension policy had been signed by 301 employees as of Dec. 27, the article said. (Source: New York Times, Dec. 27, 2011.)

Ambani brothers show signs of thawed relations

Feuding brothers Mukesh and Anil Ambani joined together to commemorate the 80th anniversary of their late father's birth, Bloomberg reported. They "were seen together for the first time since they pledged harmony in May 2010" at an evening ceremony. The next day, they unveiled a memorial to Dhirajlal Ambani at their family home, the article said.

The brothers split their father's Reliance empire in 2005. Mukesh took the petrochemicals, oil and gas units; Anil took the power, financial services, telecommunications and entertainment businesses, the article said. Shares in all four of Anil's businesses have dropped 50% to 60% this year, according to a Financial Times report.

The FT report said their mother, Kokilaben Ambani, "has made a rare statement of family unity," saying that "there was still ‘love among the brothers' and her family were ‘all united.'"

The FT article noted that "even minor moves [by the brothers] have been pored over for signs of amity or enmity, even if a formal reunion remains unlikely." (Sources: Bloomberg, Dec. 28, 2011; Financial Times, Dec. 28, 2011.)

Just Born opens casino store

Peeps & Co., the retail unit of family-owned Just Born Inc., has signed a lease to open a store in the Shoppes at Sands, next to the Sands Casino Resort in Bethlehem, Pa., the Philadelphia Business Journal reported. The store will sell Peeps, Mike and Ike, Goldenberg's Peanut Chews and other Just Born candy brands, the article said.

Peanut Chews has also inked a sponsorship deal with the Philadelphia Union soccer team and is beginning a new marketing campaign, the journal article said.

The Philadelphia Inquirer reported that Just Born's marketing campaign for Peanut Chews will stress the candy's Philadelphia origins. Just Born acquired Philadelphia-based Goldenberg Candy Co. from the Goldenberg family in 2003, the Inquirer report said.

Just Born Inc., which had dreams of taking Pewnut Chews national, has decided to retrench and remind customers in its core Mid-Atlantic market of the treat that has been made in Philadelphia since 1917.

When Just Born changed the color of the Peanut Chews wrapper and de-emphasized the Goldenberg name, customers "lost track" of the product, Bob Zender, Just Born's marketing manager for Peanut Chews, told the Inquirer. The company has since enlarged the word "Goldenberg's" and restored the traditional red and brown colors on the package. Just Born is also launching a regional ad campaign, the article said.

David Yale joined Just Born, which is based in Bethlehem, as president and chief operating officer in February 2011, the Inquirer article noted. (Sources: Philadelphia Business Journal, Dec. 23, 2011; Philadelphia Inquirer, Dec. 26, 2011.)

Observer: CEO ouster could signal family rift at N.Y. Times

The unexpected departure of Janet Robinson as CEO of the New York Times Company could be a sign of tension in the controlling Sulzberger family, columnist Keith J. Kelly wrote in the New York Post.

Douglas Arthur, managing director at Evercore Partners, told Kelly:

"I believe it's fair to speculate that the quick Robinson exit could suggest a bubbling family rift in terms of the direction of the company, the failure of the stock to respond to the success of the paywall launch and the lack of progress turning around [a network of informational websites owned by the Times Co.]."

Kelly's report also said rumors are afloat that Michael Golden, the "influential first cousin" of the Times Co. chairman, Arthur Sulzberger Jr., could be in line for the CEO position. Golden is in charge of the company's regional newspaper group, which is being sold off. He has been vice chairman of the Times Co. since 1997 and serves on the board, the article said. (Source: New York Post, Dec. 20, 2011.)

Judge challenges SEC’s settlement with Koss

Judge Rudolph Randa of U.S. District Court for the Eastern District of Wisconsin has sent a letter to the Securities and Exchange Commission challenging a settlement reached in October with Koss Corp. and its CEO, Michael Koss.

The company had been accused of preparing inaccurate financial statements and maintaining poor internal controls from 2005 to 2009, a Financial Times report said. The charges stemmed from embezzlement committed by the company's former vice president of finance, Sujata Sachdeva, who is serving an 11-year prison sentence.

As part of the settlement, Mr. Koss agreed to reimburse the company $242,419 in cash and 160,000 share options as well as a previous agreement to repay the company $208,895 under the clawback provision of the Sarbanes-Oxley law. The total amount represented his inventive bonuses for 2008, 2009 and 2010, the SEC said.

The judge said in his letter that he was "concerned" about the settlement, given that Koss and his family own 70% of the company's shares, and questioned the SEC's enforcement of the injunction, the FT article said. (Source: Financial Times, Dec. 22, 2011.)

LVMH again increases its stake in Hermes

Giant luxury group LVMH has increased its stake in Hermès to 22.3% from 21.4%, Reuters reported. LVMH now has 16% of Hermès's voting rights, the report noted.

In a filing to France's AMF stock regulator LVMH said it plans to continue buying Hermès shares but does not plan to take control of the company or make a takeover offer for it, the Reuters article said.

More than a year ago, LVMH announced it had built up a 17% stake in Hermès, and it has been increasing its holdings since then. Hermès's family shareholders have created a holding company to shield the company from a takeover, the Reuters report noted. (Source: Reuters, Dec. 20, 2011.)

N.Y. Times Company planning sale of regional newspapers

The New York Times Company announced that it was "in advanced talks" with a prospective buyer of 16 regional newspapers, according to an article in the New York Times. The report said the negotiations with Halifax Media Holdings of Daytona Beach Fla., are "another indication the company was divesting itself of assets to concentrate on its core newspaper business."

The Times Co. and Halifax are discussing the sale of the Times Co.'s Regional Media Group, which includes newspapers around the company, which have a total of 1,755 full-time employees. Analysts estimated that the price would be about $145 million, the Times article said. The report noted that Times Co. and Halifax have been in discussions for months.

In July, the Times Co. sold more than half its stake in the Fenway Sports Group, which owns the Boston Red Sox. The New York Times report said that its next move might be to sell the Boston Globe. A Wall Street Journal report noted that the company tried unsuccessfully to sell the Globe in 2009.

Analyst Craig Huber of stock research firm Access 342 told the Journal:

"All the company cares about at the end of the day is keeping afloat the flagship New York Times newspaper for the long term. Everything else in my opinion could be and would be put up for sale."

Michael Golden -- a member of the Sulzberger family, which controls the Times Co. -- oversees the company's Regional Media Group, the Journal report noted. (Sources: New York Times, Dec. 19, 2011; Wall Street Journal, Dec. 20, 2011.)

Brothers accused of fraud sell Great Lakes Foods

Brothers Rassem "Russ" Kaloti and Ishaq "Isaac" Kaloti will sell their food distribution company, Great Lakes Foods, based in Menominee, Mich., the Milwaukee Journal-Sentinel reported. The brothers could face prison sentences in a federal fraud case, the article said.

In October, the Kalotis agreed to plead guilty to conspiracy and tax fraud charges connected to the hiding of millions of dollars using secret bank accounts in their grocery business. Isaac Kaloti also agreed to plead guilty [of] receiving stolen baby formula.

The brothers started Great Lakes Foods in 2000 after they sold a predecessor company to wholesaler Fleming Cos., which has since gone out of business, the article said. They are selling Great Lakes Foods, which has 95 employees, to businessman Tom Kuber. (Source: Milwaukee Journal-Sentinel, Dec. 15, 2011.)

Comcast’s Brian Roberts to pay antitrust fine

Brian Roberts, chairman and CEO of Comcast Corp., will pay a $500,000 fine for violating reporting and waiting period requirements before purchasing shares of the company, the website reported. The fine, which settles a complaint by the U.S. Department of Justice's Antitrust Division, is pending court approval, according to the report.

The complaint charges that Roberts failed to comply with requirements of the Hart-Scott-Rodino Act (HSR), which says individuals and companies over a certain size must file notifications and wait for a specified period before acquiring stock or assets above a certain value. Roberts' violation occurred in 2007, according to the report.

Roberts' stock purchases were made as part of a dividend reinvestment of his 401(k) and annual stock grants, the complaint said. The purchases resulted in his holding more than $119.6 million worth of company stock.
And while the complaint acknowledges the failure to comply with HSR was inadvertent, it said Roberts had been warned on two prior occasions, in 1999 and in 2000, in an effort to ensure that he complied with the law.

(Source:, Dec. 18, 2011.)

New York Times CEO to leave her post

New York Times Co.'s non-family CEO, Janet Robinson, will step down from her post at the end of the month, the company announced. "The announcement caught many by surprise -- both inside and outside the company," according to an article in the New York Times.

Arthur Sulzberger Jr., chairman of the company and publisher of the Times, will serve as interim CEO as the company begins "an internal and external search" for Robinson's replacement, the Times article said. The Sulzberger family controls the company through super-voting stock.

Alan D. Mutter, a journalism lecturer at the University California, Berkeley, and a former newspaper editor, told the Times, "You have to give [the company] a demerit for not having a succession plan in place."

A Wall Street Journal article said:

The company's struggles during the worst of the downturn had prompted some members of the Sulzberger family to question whether Ms. Robinson was the right person to guide the company in a digital world, according to people briefed on the family's thinking.

The Journal report noted that Arthur Sulzberger Jr. had "very publicly stood by Robinson."

According to a Times Co. filing with the Securities and Exchange Commission, Robinson will serve as a consultant for the company for one year and will be paid $4.5 million. The filing states that her agreement includes "two-year non-competition, non-solicitation and non-disparagement covenants, a three-year cooperation covenant and an indefinite confidentiality covenant." The blog noted that since the Times reported that she was paid $4.9 million in 2009, "she'll earn almost as much as a retired consultant than as a full-time CEO." (Sources: New York Times, Dec. 15, 2011; Wall Street Journal, Dec. 16, 2011;, Dec. 15, 2011.)

Cablevision’s COO resigns

Cablevision Systems Corp.'s chief operating officer, Tom Rutledge, "quit abruptly" on Dec. 15, the Wall Street Journal reported. Rutledge reportedly had viewed as a potential CEO of another cable or satellite operator, the article said.

Mr. Rutledge's resignation sparked speculation on Wall Street that Cablevision could put itself up for sale rather than have the controlling shareholder, the Dolan family, seek a replacement of the same caliber for Mr. Rutledge....
Cablevision CEO James Dolan, the 56-year-old son of company founder and chairman Charles Dolan, 85, is better known for his other interests -- such as his involvement with the New York Knicks -- than as a hands-on cable executive.

Another Cablevision executive -- John Bickham, president of cable and communications -- left the company before Thanksgiving, according to the report. (Source: Wall Street Journal, Dec. 16, 2011.)

Hermes family announces holding company details

The family that controls Hermès International revealed the details of a 12 billion euro family holding company with a 50.2% stake in the business, the Financial Times reported. The family established the holding company to protect the luxury goods group and demonstrate family unity after LVMH boosted its stake in Hermès to 21.4%.

Family members will have the right of first refusal of shares held by relatives. The FT reported that "about 72" family members have put their shares into the holding company, called H51. The only one who did not is the largest shareholder, Nicolas Puech, who owns about 6%. Puech is the brother of Bertrand Puech, who is chairman of the limited partnership that controls the company. The FT report said that Nicolas Puech wants to put his shares in a foundation.

The report said the holding company will keep one-third of the annual dividends and will use those funds to buy shares from family members who want to sell. After 20 years, family shareholders can have one third of their shares in the holding company repaid to them, the article said. (Source: Financial Times, Dec. 15, 2011.)

Survey: Chinese entrepreneurs worry about their kids

A survey entitled "China Family Business Report," a collaboration of several Chinese business organizations, reports that the country's business founders are worried that their children will ruin their businesses, a Financial Times blog reported.

[N]early three quarters of entrepreneurs surveyed did not want to pass the family business on to the next generation -- and half of the kids did not want to inherit it anyway.

The report said that according to an official from the All-China Federation of Industry and Commerce, half of China's GDP comes from family-owned businesses.

The FT blog cited the official publication China Daily, which quoted Chen Ling of Zhejiang University's Department of Family Business as saying that many Chinese businesses are low-end manufacturing companies, and next-generation members "live in a China that is aiming to climb higher up the value chain." (Source: Financial Times, Dec. 13, 2011.)

Release of e-mail increases pressure on James Murdoch

The release of a June 7, 2008, e-mail from former News of the World editor Colin Myler is increasing the pressure on News Corp. deputy chief operating office James Murdoch, Bloomberg reported. The e-mail, sent from Myler to Murdoch, provides evidence that phone hacking at the tabloid went beyond a single rogue reporter.

Murdoch said he didn't read the entire e-mail because it was sent on a Saturday when he wasn't in the office, the Bloomberg report said.

In testimony before U.K. lawmakers on November, Murdoch said he was not fully briefed on the extent of the hacking. He is the son of News Corp. chairman and CEO Rupert Murdoch. (Source: Bloomberg, Dec. 14, 2011.)

Bill Marriott Jr. is retiring

J.W. "Bill" Marriott Jr., 79, announced that he will retire as CEO of Marriott International Inc. Marriott turned the hotel chain his father founded into a global brand, the Wall Street Journal noted.

Chief operating officer Arne Sorenson will become the company's first non-family CEO. Marriott said he began planning the transition about three years ago, the Journal article said.

Industry veterans credited Mr. Marriott for pioneering the now-standard business model used by the industry. Under that model, hotel companies no longer own real estate but operate or franchise their brand.

(Source: Wall Street Journal, Dec. 14, 2011.)

SEC accuses Stiefel heir of fraud

The Securities and Exchange Commission has filed a lawsuit accusing Charles W. Stiefel, former chief of Stiefel Laboratories of cheating his former employees out of more than $110 million by hiding key information about the company during Steifel Labs' buyback of their shares in the company's stock plan at low valuations, the New York Times' DealBook blog reported.

Stiefel Labs, a family-owned dermatology business, was acquired by GlaxoSmithKline for $2.9 billion in 2009. The SEC alleges that among the key information withheld during the stock buyback was the potential acquisition by GlaxoSmithKline.

The report noted that the case is unusual because Stiefel Labs was a privately held company. The SEC is increasing its scrutiny of private companies, the article said.

Stiefel, who is now an adviser to a private equity firm, also is being sued by several former employees.

The company, founded by the Stiefel family in Germany, was based in Coral Gables, Fla., and had sales of about $1 billion. The Stiefel family began an employee stock plan in the 1970s, the article said. Charles Stiefel became the company's controlling stockholder in 2006 and began exploring interest from outside investors.

Over the next three years, Mr. Stiefel courted various investment proposals from multiple private equity firms and large corporations. In 2007, Stiefel Laboratories received a $500 million minority investment from the private equity giant Blackstone Group.
During that period, the Stiefel family acquired several thousand shares from its employees and other shareholders. The SEC said that those purchases were made at misleading valuations, because Mr. Stiefel knew that the company was worth far more based on his conversations with Blackstone and other potential investors....
During that period, the Stiefel family sent each other e-mails indicating that they were alert to the company's valuation and how it might spike in the event of an acquisition, according to the complaint.

(Source: DealBook, New York Times, Dec. 12, 2011.)

Warren Buffett names son as his successor

In an interview with Lesley Stahl on CBS TV's 60 Minutes, Berkshire Hathaway founder Warren Buffett, 81, said he has planned for his son Howard, 57, to become "non-executive chairman" of the $300 billion company after the elder Buffett's death.

Howard Buffett, a farmer, lacks a college degree. Warren Buffett said in the interview that Howard would serve as a guardian of the company's traditions, practices and values. The position of non-executive chairman would be unpaid, and Howard would not direct strategy at the investment firm. Shares in Berkshire Hathaway trade at over $100,000 apiece, CBS noted.

Howard Buffet told CBS he intended to continue farming. An Investopedia report noted that he farms corn and soybeans on 1,500 acres in Nebraska and has never relied on his father's fortune to fund his farm expenses.

The Investopedia report also said that Howard Buffett has served on Berkshire Hathaway's board since 1993. He also serves on the board of Coca-Cola and two other companies and has previously been a director of ConAgra Foods and Archer Daniels Midland. He also runs the $200 million Howard G. Buffett Foundation. (Sources: CBS, Dec. 9, 2011; Investopedia, Dec. 12, 2011.)

Waltons selling 70 million shares of Wal-Mart stock

Members of the founding Walton family are selling more than 70 million shares in Wal-Mart Stores Inc., Reuters reported.

Walton Enterprises LLC, controlled by S. Robson Walton, Alice L. Walton, Jim C. Walton and the John T. Walton Estate Trust, will sell the shares, which represent about 2% of Wal-Mart's outstanding shares, according to the report. The shares were registered on behalf of several Walton charitable trusts, the article said.

The sale will reduce the percentage of the company owned by founder Sam Walton's descendants from about 49% to about 47%, the Reuters report said.

However, Wal-Mart is in the midst of a share buyback program, so it's not clear what portion of the company the Waltons will end up owning after the share sales are completed.

(Source: Reuters, Dec. 9, 2011.)

Ford reinstates dividends

Ford Motor Co. announced that it will resume quarterly dividends starting with the first quarter. The company had suspended dividends for more than five years. The quarterly dividend will be five cents per share.

Ford was the only U.S. automaker to avoid a government bailout during the financial crisis.

According to the Wall Street Journal, Ford said it would maintain the dividend even if the U.S. is hit with another downturn.

A Financial Times report noted:

Members of the Ford family will be among the main beneficiaries of the dividend reinstatement. They own the bulk of the companies 73 million class B shares, which carry more voting rights.

(Source: Financial Times, Dec. 9, 2011; Wall Street Journal, Dec. 9, 2011.)

Cargill’s bearish outlook stands alone

Cargill's recent move to eliminate 2,000 jobs follows a pattern of "bearishness" that makes it stand out in the commodities trading sector, a Financial Times article noted. The report said Cargill "was the first big trading house to warn about the economic slowdown." Glencore and Noble Group, other major commodities traders, are "painting a much rosier outlook" of their businesses and the global economy, the FT report said.

t is worth noting that Cargill is a privately owned company -- still controlled by the MacMillan and Cargill families, descendants of the founders who set up the group in 1865 -- so it does not feel obliged to put as brave a face on in a bad economic environment as its publicly listed rivals.

(Source: Financial Times, Dec. 5, 2011.)

Santander sells Colombian businesses, stake in Chilean unit

Spain's Banco Santander SA sold a 7.8% stake in its Chilean unit and said it will sell all of its Colombian businesses to Chile's CorpBanca, the Wall Street Journal reported. Previously, the bank had announced plans to sell 8% of its Brazilian unit. It also has sold part of its U.S. auto-loan unit and offered to exchange some of its outstanding bonds.

The report noted that, like other European banks, family-controlled Santander is trying to raise capital without reducing dividend payments or selling new shares at distressed prices. European banking regulators told Santander it needed at least 5 billion euros in new funds, the report noted.

(Source: Wall Street Journal, Dec. 8, 2011.)

Transitions East 2012 now taking registrations

Registration is now open for Transitions East 2012, a conference co-hosted by Family Business Magazine and Stetson University's Family Enterprise Center. The conference will take place April 25-27 at the Grand Bohemian Hotel in Orlando, Fla.

The theme of Transitions East 2012 is "Sustaining and Building the Multi-Generational Family Company." The conference will focus on three key touchpoints that can make a significant difference in the long-term sustainability of a family business:

Family Employment Policies: Landmarks and Landmines
Ownership Strategies for Multi-Generational Family Enterprises: Who Can and Should Own What?
The Family Enterprise and the Extended Family: Fostering Cooperation and Resolving Conflict Among Siblings, Cousins and Married-Ins

A program agenda, list of confirmed speakers and registration information are available at

Cargill to cut 2,000 jobs

Cargill will eliminate 2,000 jobs globally, Reuters reported. The giant agribusiness company cited the weak global economy in making the announcement,

The job cuts will affect 1.5% of Cargill's 138,000 employees in 63 companies. The jobs will be eliminated over the next six months, according to the report.

Cargill added it was making internal structural changes, following a review of its global energy, transportation and metals operations.

(Source: Reuters, Dec. 5, 2011.)

Thomson Reuters ousts its CEO

Thomson Reuters Corp. ousted Thomas Glocer, who had been the company's CEO since 2008, and replaced him with chief operating officer James Smith, effective Jan. 1, the Wall Street Journal reported. Smith had been COO only since late September; he previously was chief executive of the company's Professional division, the article said.

The shake-up ... suggests that the controlling family has lost patience with Mr. Glocer's management, particularly his efforts to turn around its Markets division, which sells package of financial data, news and analytical tools to financial professionals.

The report noted that the Markets division's revenues rose 1% in the September quarter, compared with a 10% increase in the Professional division (legal, tax and accounting, and health-care information).

The Journal article said there may have been cultural issues related to the integration of the former Thomson and Reuters businesses. Thomson acquired Reuters in 2008.

Mr. Glocer came from the Reuters side, having been CEO of that company since 2001. But the Thomson family, which controlled Thomson Corp. before the deal, ended up with control and has been pushing for people from their side of the deal to play a larger role in the company.

(Source: Wall Street Journal, Dec. 2, 2011.)

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