IndyMac: High-profile buyers for a toxic thrift
“Who wants to buy a failed bank at the heart of the country’s mortgage crisis?” asked Heidi Moore in The Wall Street Journal. The answer, it turns out, is some of the biggest names in American business. George Soros, Michael Dell, and hedge fund manager John Paulson are among the investors who participated last week in the $1.6 billion purchase of California’s IndyMac Bank from the Federal Deposit Insurance Corp., which seized the bank in July.
Incoming CEO Steve Mnuchin , a 46-year-old former Goldman Sachs executive, needs “a “new game plan,” said E. Scott Reckard in the Los Angeles Times. IndyMac was undone by “a failed strategy of using high-interest deposits to fund mortgage loans to borrowers” who often supplied no income or employment verification. Some analysts expect IndyMac to expand its loan-servicing business, “which handles billing, collections, delinquent accounts, and loan modifications” for other banks. But IndyMac says it will still concentrate on mortgage lending, though it has little experience in “old-fashioned, fully documented loans.”
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Apple Inc.: Jobs acknowledges ailment
After refusing to comment for months, Apple Inc. CEO Steve Jobs this week finally addressed rumors about his health, said Aaron Smith in CNNmoney.com. Jobs said that “a hormone imbalance” had “robbed” his body of vital proteins, which led to a dramatic drop in weight last year. His “noticeable” weight loss set off speculation about his health and hurt Apple’s stock price, as investors worried that Apple might lose the CEO who created the iPod and iPhone. Jobs, who had surgery for pancreatic cancer in 2004, says his more recent ailment is being treated successfully and that he will stay on the job.
Dell Computers: Another executive shake-up
For the second time in two years, Dell Computer shook up its top management last week as it struggles to regain market share lost to archrival Hewlett-Packard, said Aaron Ricadela in BusinessWeek. Founder and CEO Michael Dell “had to do something,” after the company’s share price fell 58 percent in 2008, despite a string of aggressive acquisitions and new product introductions. The ousters of global operating chief Mike Cannon and chief marketing officer Mark Jarvis suggest that Dell might take “even bolder steps in 2009.”
Housewares: A British icon falls
One of British business’ oldest names, Waterford Wedgwood, filed for bankruptcy this week, said Jim Boulden in CNNmoney.com. The maker of glassware and fine china, which “can trace its roots back to the 18th century,” made the move after three years of losses and declining sales. Waterford Wedgwood has hired accounting firm Deloitte Inc. to “find the most profitable way to pay creditors,” either by continuing to operate in bankruptcy or by selling its brands, including Royal Doulton china and Rosenthal porcelain.
Toys: A home for Thomas the Tank Engine
Fisher-Price, a unit of Mattel Inc., this week won the highly coveted marketing rights to Thomas the Tank Engine, a favorite of the under-5 set, said the Associated Press. HIT Entertainment, which controls the rights to Thomas, will collect an undisclosed fee to license manufacturing and marketing rights to Fisher-Price, which will sell “vehicles, play-sets, preschool toys, and other products,” beginning in 2010. HIT also owns the rights to Barney the dinosaur and Bob the Builder.
