SECTION: FINANCIAL; Pg. E02

LENGTH: 1188 words

HEADLINE: EU Moves to Retaliate

BODY:






Increasing pressure on the United States in the transatlantic dispute over steel, the European Union said that EU governments unanimously endorsed steps that could lead to punitive duties next month on a variety of U.S. products in European markets. The fight began in March when President Bush decided to impose tariffs on imported steel. The EU, joined by several other trading partners, challenged the tariffs at the World Trade Organization, and European officials further declared that under WTO rules they have a right to retaliate even before the Geneva-based trade arbiter rules on the case.





Securities and Exchange Commission Chairman Harvey L. Pitt agreed to provide Congress with a written account of his meeting with KPMG chief executive Eugene O'Kelly at the request of Rep. W.J. "Billy" Tauzin (R-La.), chairman of the House Commerce Committee. The April 26 meeting came as the SEC staff investigated whether KPMG approved accounting irregularities at Xerox. Pitt represented KPMG and other accounting firms in private practice. Pitt and Tauzin "had an open and frank discussion about the incident, and Chairman Tauzin is satisfied that no one at the SEC did anything improper," Tauzin spokesman Ken Johnson said. "He did, however, ask Chairman Pitt to explain the incident in writing for the record."

Investors snapped up a record $ 22 billion in five-year notes sold by the government, with demand exceeding the $ 23.5 billion bid at the last quarterly auction, in February. With 1.72 times as many bids as available securities, demand for the new five-year notes was the highest since the government sold $ 16 billion of the securities in November.

Georgia-Pacific will separate the company's lucrative consumer products business into a new company and sell some of its shares to the public. The IPO is scheduled for the third quarter. It will involve 15 percent to 20 percent of the new company, which has yearly sales of more than $ 12 billion from brands such as Angel Soft and Quilted Northern bathroom tissue and Brawny paper towels.

Pepsi will introduce an aqua-blue-colored, wild-berry-flavored version of its flagship brand in August as the second-largest soft-drink maker tries to boost sluggish U.S. cola sales. Pepsi is counting on the new drink, called Pepsi Blue, to help attract more 13-to-24-year-olds, who drink less cola than older consumers, Gary Rodkin, chief executive of North American soft-drink operations, told reporters.

Coca-Cola, the world's biggest soft-drink maker, agreed to buy the Seagram's Mixers business from Diageo and Pernod Ricard for an undisclosed sum. Coca-Cola also signed a long-term licensing agreement with Pernod Ricard to add Seagram's mixers, which include ginger ale, tonic, club soda and seltzer, to its line of non-alcoholic beverages.

EBay and Accenture will offer a service to help manufacturers, distributors and retailers sell excess and discontinued inventory on eBay's Web site. Accenture, the world's largest consulting company, will own and operate the service, which will provide software, strategies and high-volume listing capabilities, eBay said.

Bristol-Myers Squibb shareholders voted to back a nonbinding measure requiring that the company's board of directors seek shareholder approval before implementing "poison pill" anti-takeover measures. More than 60 percent of shareholders who cast a vote supported the measure, the company said at its annual shareholder meeting.



Canada's agriculture minister, Lyle Vanclief, said Ottawa may boost farm subsidies to compete with new U.S. measures and bolster production in one of the world's biggest grain exporters. The six-year, $ 51.7 billion U.S. farm bill would increase subsidies for big grain and cotton growers by 80 percent. The European Union, Canada, Australia and Brazil say the legislation breaks a commitment by the United States to cut subsidies, and they have threatened a challenge at the Geneva-based World Trade Organization.

A German union, the 2.7 million-member IG Metall, shifted its strike from the auto industry and targeted companies that make refrigerators, medical equipment and batteries. The union is striking in the southern manufacturing state of Baden-Wuerttemberg in its fight for higher wages. A settlement in the region is expected to set the pattern nationwide.

European Union finance ministers gave final approval to a tax on music, video games and software downloaded from the Internet, rejecting a U.S. complaint that it may harm companies such as Microsoft and AOL Time Warner. The tax, at rates of 15 percent to 25 percent, depending on where the customer lives, will take effect in July 2003. It will close a loophole by requiring non-European sellers of "virtual" products to charge European retail customers the same tax now levied by European suppliers.



General Motors is recalling 65,000 sport-utility vehicles to repair a possible problem with fuel-line fittings, the automaker said. The recall affects 2002 Chevrolet TrailBlazer, GMC Envoy and Oldsmobile Bravada SUVs made in September, October and the first week of November last year. The vehicles have fuel-line fittings that may disconnect at the fuel-filter outlet, GM said. It said there had been no reports of accidents or injuries because of the problem. Owners will be notified of the recall by mail. GM dealers will make repairs free.



Clear Channel Communications, owner of 1,200 U.S. radio stations, had a first-quarter loss of $ 16.9 billion after writing down the value of acquired assets. The loss widened from $ 309.2 million in the year-earlier period. Sales rose 4 percent, to $ 1.7 billion. Excluding the acquisition costs, profit would have been $ 90.3 million.

Halliburton, the world's second-biggest provider of oil-field services, said net income in the first quarter plunged 80 percent because of asbestos expenses and a decline in drilling as energy prices fell. Net income dropped to $ 22 million, from $ 109 million a year earlier. Revenue decreased 4.4 percent, to $ 3.01 billion.

MetLife said net income rose 15 percent in the first quarter because of cost cuts and higher profits from group life and disability policies. Net income climbed to $ 329 million from $ 287 million a year earlier. Revenue increased 2 percent, to $ 8.09 billion from $ 7.94 billion.

Prudential Financial, the second-biggest U.S. life insurer, said first-quarter profit fell 35 percent because it sold securities at a loss and pared its fees for managing assets. Net income was $ 263 million, compared with $ 403 million a year ago, before Prudential sold shares in an initial public offering in December.

Waste Management, the biggest U.S. trash hauler, said first-quarter profit rose 11 percent as the company fired workers and reduced costs during a business slump. Net income increased to $ 138 million, from $ 124 million a year earlier. Revenue fell 4 percent, to $ 2.61 billion from $ 2.72 billion.

Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers

LOAD-DATE: May 08, 2002