Judges vilify 'manipulative' tycoon

May 25th, 2007

A FABULOUSLY wealthy African businessman was condemned by three appeal judges yesterday for trying to manipulate Scotland’s supreme civil court.

Chief Oladeinde Fernandez, 69, had been facing a 1 million claim from his former partner in the Court of Session, but he wanted a hearing delayed.

Advised by his QC that a postponement would not be allowed, he and some of his lawyers put in place a scheme to force the court to grant his request. The plot included switching solicitors at a late stage, and Chief Fernandez asserting that he could not come to Scotland because he would be travelling in Africa.

In yesterday’s judgment, Lord Penrose, sitting with Lords Eassie and Mackay, branded the scheme “discreditable” and said: “Any party inclined to adopt such measures should be aware of the risk of condemnation on discovery.”

He went on: “It must be hoped that the machinations of [Chief Fernandez] and his legal advisers in this case were indeed exceptional. It would be difficult to conceive of a more deliberate manipulation of the ordinary procedures of the court in support of a determined intention to default than has occurred in this case.”

The scheme failed, because a judge had refused to continue the case and granted a decree against Chief Fernandez in his absence. That ruling was upheld by appeal judges yesterday.

Chief Fernandez, who was for several years the Central African Republic’s ambassador to the United Nations, set up home with Aduke Fernandez, 55, in a 3 million, seven-storey townhouse in Drumsheugh Gardens, Edinburgh, in 1999. As a hugely successful businessman, his interests included oil wells, gold and diamond mines and property in New York.

The couple separated in 2003 and he moved to live at the Ritz Hotel, Paris. Ms Fernandez raised Scotland’s biggest divorce action, seeking some 300 million, but the chief disputed that they had ever been married. Eventually, a settlement was agreed, part of which involved Ms Fernandez being paid 30,000 a month for three years.

However, Chief Fernandez stopped the payments, claiming Ms Fernandez had breached the agreement. She then asked Lord Macphail to rule that the agreement remained legally binding and to award her 1,020,000. The judge heard some evidence in October 2005 but the case overran its allocated time. It was set down to resume last August.

A few days in advance of that hearing, Chief Fernandez’s team sought a discharge, but Lord Macphail refused. On the day of the hearing, the chief did not attend and his lawyers withdrew. Lord Macphail granted decree by default against Chief Fernandez.

Lord Penrose said it was quite clear from information now available that, unimpressed by advice from his then QC that a motion to discharge the hearing would not succeed and was not appropriate, Chief Fernandez “and at least some of his legal advisers set about implementing a scheme to force the hand of the court and to achieve the discharge that he wished”.

He added: “Such deliberate obstruction of the conduct of civil litigation cannot be tolerated with equanimity.”

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Blackstone Group Agrees to Buy Alliance Data Systems

May 25th, 2007

Alliance Data Systems (http://www.businessweek.com/ticker/) agrees to be acquired by Blackstone Group for $81.75 per share cash, or total of $7.8 billion, including the assumption of certain debt.

24/7 Real Media (http://www.businessweek.com/ticker/) agrees to be acquired by WPP Group (http://www.businessweek.com/ticker/) for $11.75 cash per share, for a total transaction value of about $649 million net of cash acquired. The deal is expected to be completed by end of the third quarter.

Liberty Media (http://www.businessweek.com/ticker/) acquires the Atlanta Braves baseball club from Time Warner (http://www.businessweek.com/ticker/). Liberty Media exchanges 68.5 million Time Warner shares with Time Warner for a newly created unit of Time Warner which holds the Atlanta Braves baseball club, Time Inc.’s Leisure Arts, and $960 million of cash. The deal essentially completes Time Warner’s $20 billion stock buyback.

Acxiom (http://www.businessweek.com/ticker/) agreed to be acquired by Silver Lake and ValueAct Capital for $27.10 per share in cash, in a deal valued at about $3 billion including the assumption of $756 million in debt. Separately, Acxiom posted 8 cents in fourth-quarter EPS on a 3.8% revenue rise.

Nexstart Broadcasting (http://www.businessweek.com/ticker/) hires Goldman, Sachs & Co. to assist in reviewing alternatives including but not limited to a sale of the company.

Hewlett-Packard (http://www.businessweek.com/ticker/) shares were higher after the company posts 70 cents, vs. 69 cents a year ago, second-quarter non-GAAP EPS on a 13% revenue rise. It sees third-quarter non-GAAP EPS of 64-65 cents on revenue of $23.7-$23.9 billion, and fiscal year 2007 EPS of $2.75-$2.77 on revenue of $100.5-$100.9 billion. S&P keeps hold.

J.C. Penney (http://www.businessweek.com/ticker/) posted first-quarter earnings per share from continuing operations of $1.04, vs. 90 cents a year ago, on 2.2% higher comp-store sales and 3.1% higher total sales. The retailer sees about 77 cents second-quarter EPS on a low- to mid-single digit rise in comparable department-store sales.

BEA Systems (http://www.businessweek.com/ticker/) says first-quarter revenue rose 7% to $345.8 million; license fees fell 13%, services revenue up 21%. It sets $500 million stock buyback. It says a review of past comp awards will hurt some historical results. Goldman ups estimate, and S&P keeps buy on the stock.

Sun Microsystems (http://www.businessweek.com/ticker/) set a $3 billion stock buyback.

Dusa Pharmaceuticals (http://www.businessweek.com/ticker/) receives orphan drug designation from FDA for its Levulan Photodynamic Therapy for treatment of esophageal dysplasis.

Scottish Re Group (http://www.businessweek.com/ticker/) says CFO Dean E. Miller will be leaving the company effective May 18, 2007. The company intends to announce a successor to Miller shortly.

Micron Technology (http://www.businessweek.com/ticker/) plans to offer $1.1 billion principal amount of unsecured convertible notes; plans to enter into capped call transactions with one or more counterparties, which expected to reduce potential dilution upon conversion of notes.

Safeway (http://www.businessweek.com/ticker/) raises its quarterly dividend by 20% to $0.069 from $0.0575.

Fords loss narrows to $282 million

May 25th, 2007

DEARBORN, Mich. - Ford Motor Co. on Thursday posted a first-quarter loss of $282 million, a vast improvement over the $1.4 billion it lost in the first quarter of 2006.

It was Fords seventh consecutive quarterly loss, but the automaker said the smaller deficit reflected its restructuring efforts as it tries to cut costs in the face of withering competition from Asian automakers.

The loss of 15 cents per share for the January-March period compared with a loss of 76 cents per share in the same period a year ago.

Revenue rose to $43 billion from $40.8 billion a year ago.

Without special items, primarily restructuring costs, Ford said it would have lost $171 million, or 9 cents per share, compared with an operating profit of $223 million, or 12 cents per share, a year ago.

The loss excluding special items was far less than Wall Street estimates. Sixteen analysts polled by Thomson Financial expected a loss of 60 cents per share. Those estimates typically exclude special items. 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.