DealBook: High-Paid Chiefs on the Hot Seat

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Edited by Andrew Ross Sorkin

TODAY'S TOP HEADLINES | Friday, March 7, 2008 M & A: I.B.M. Says It Won't 'Do a Yahoo' BANKING: Citi Said to Consider Changes at U.S. Consumer Unit PRIVATE EQUITY: More Margin-Call Woes at Carlyle Capital HEDGE FUNDS: Motorola and Icahn Gird for Second Round OFFERINGS: Ambac Raises $1.5 Billion VENTURE CAPITAL: Kleiner Perkins to Aid iPhone Developers LEGAL: Aversion to Risk Deepens Credit Woes TOP STORY High-Paid Chiefs on the Hot Seat The former chiefs of Countrywide Financial, Citigroup and Merrill Lynch were set to testify before Congress on Friday about the abundant pay packages they got even as their shareholders lost billions -- and if a memorandum released ahead of the hearing is any guide, they can expect quite a grilling. Documents uncovered by the committee's investigation included internal e-mail messages discussing pay practices. One document showed Countrywide seeking out a second opinion after a compensation consultant hired by its board said Mr. Mozilo's compensation was inflated. In an e-mail cited by investigators, Mr. Mozilo complained to a consultant about the pressure on boards from "the left-wing antibusiness press and the envious leaders of unions and other so-called 'C.E.O. Comp Watchers.'" Go to Article from The New York Times» Go to Memos from the House Oversight Committee» Go to Article from The Associated Press» Go to Article from Salon» Read More Add a comment ADVERTISEMENT Back to Top MERGERS & ACQUISITIONS International Business Machines's chief executive, Sam Palmisano, said on Thursday the company is "on track" to meet its 2010 earnings target, and he ruled out mega-mergers on the scale of Microsoft's $40 billion-plus bid for Yahoo. Go to Article from Reuters via The New York Times» Read More Add a comment Harry Macklowe is making progress in selling the General Motors Building in New York, having received "several" second-round bids that top $3 billion, The New York Post reported, citing an unnamed source. Go to Article from The New York Post» Go to Previous Item from DealBook» Read More Add a comment Deutsche Telekom, which owns T-Mobile, may consider acquiring Sprint Nextel to block a price war in the mobile phone industry, analysts at Merrill Lynch said in a report. Go to Article from The Kansas City Star» Read More Add a comment Bill Gates took first place in VanityFair.com's "Windfall Report," a ranking of last year's cash-yielding transactions -- many related to mergers -- and the people who were enriched by them. Go to Article from VanityFair.com» Read More Add a comment A pair of deals by Brazilian meat company JBS to acquire U.S. beef production assets is likely to direct political heat at the Department of Justice, according to The Deal.com. Go to Article from The Deal.com» Read More Add a comment Atari said on Thursday that majority shareholder Infogrames Entertainment has said it wants to buy the rest of the company for for $1.68 per share. Go to Article from MCV» Go to Article from Reuters» Read More Add a comment Microsoft's recently acquisition of FAST Search & Transfer is one of the latest and largest deals in the enterprise search space. The 451 Group thinks there could be more, and it names names. Go to Report from The 451 Group» Read More Add a comment Robeco Investment Management has agreed to sell its U.S. municipal fixed-income business to Lehman Brothers, as the asset manager nears the completion of plans to exit from its U.S. fixed income market. Go to Article from Financial News» Read More Add a comment Macquarie Bank's Funds Management Group has agreed to purchase a majority stake in boutique fixed-income adviser Allegiance Investment Management as the Australian bank expands its presence in the United States. Go to Article from Financial News» Read More Add a comment China Petrochemical, or Sinopec Group, agreed to buy 60 percent of AED Oil's Puffin and Talbot oil ventures in the Timor Sea for 600 million Australian dollars ($559 million) in cash, gaining production in Australia. Go to Article from Bloomberg News» Read More Add a comment Kirtland Capital Partners agreed to sell Essex Crane Rental, one of the country's largest construction crane suppliers, for $210 million to a publicly traded blank-check company, Hyde Park Acquisition. Go to Article from The Deal.com» Read More Add a comment The Federal Trade Commission has given NYSE Euronext the go-ahead to acquire the American Stock Exchange, the companies said Thursday. Go to Article from The Associated Press via BusinessWeek» Read More Add a comment Back to Top INVESTMENT BANKING Vikram S. Pandit, Citigroup's chief executive, is considering making top-level changes in the bank's U.S. consumer business, The Financial Times reported on Friday, citing unnamed sources. Go to Article from The Financial Times» Go to Related Item from DealBook» Read More Add a comment Dubai International Capital, the state-owned private equity firm, said Thursday that it "has never expressed an opinion on the investment merits or financial condition" of Citigroup, despite its chief executive saying on Tuesday that the American bank will need to raise more capital. Go to Item from DealBook» Read More Add a comment Lehman Brothers suspended two London-based equity traders after some of their trades were picked up by the bank's internal control system. Go to Item from DealBook» Read More Add a comment Back to Top PRIVATE EQUITY Carlyle Capital, the investment fund affiliated with private equity firm the Carlyle Group, said on Friday that it was exploring all its options after receiving another wave of margin calls from lenders. Go to Article from MarketWatch» Go to Article from Reuters via The New York Times» Go to Article from The Times of London» Read More Add a comment Oliver Sarkozy, who becomes co-head of Carlyle Group's global financial institutions group next month, said there is ample opportunity for buyout firms to help restructure and recapitalize the storm-tossed finance industry. Go to Article from Investment Dealers' Digest» Read More Add a comment Lyceum Capital has become one of the first private equity houses to train its sights on law firms ahead of sweeping deregulation in Britain, hiring three industry figures to advise it on potential buyouts in the sector, Legal Week reported. Go to Article from Legal Week via Law.com» Go to Article from The Times of London» Go to Article from The Telegraph» Read More Add a comment Back to Top HEDGE FUNDS Motorola is preparing for a second showdown with activist investor Carl C. Icahn, who has increased his stake in the cell-phone maker ahead of a May battle over board seats. Go to Article from The Chicago Tribune» Read More Add a comment Billionaire investor Carl C. Icahn may have lost his bid to break up Time Warner Inc., but that apparently didn't stop him from lining his pockets, he will tell CBS' "60 Minutes." Go to Article from CBS News» Go to Article from CNN Money» Read More Add a comment Louis Friedman, Bear Stearns' vice chairman of investment banking and global head of mergers and acquisitions, will join hedge-fund firm P. Schoenfeld Asset Management this spring. Go to Item from DealBook» Go to Press Release from P. Schoenfeld via PRNewswire» Read More Add a comment Al Gore recently invested $35 million with Capricorn Investment Group, according to documents obtained by Bloomberg News, which goes on to speculate about where Mr. Gore's new wealth came from. Go to Article from Bloomberg News» Read More Add a comment Endo Pharmaceuticals on Wednesday dismissed calls by its largest shareholder, hedge fund D.E. Shaw, to hold off searching for a new chief executive until it had explored strategic alternatives, including a possible sale. Go to Article from The Philadelphia Inquirer» Go to Previous Article from Reuters» Read More Add a comment Back to Top I.P.O. / OFFERING Bond insurer Ambac Financial Group said on Friday it sold $1.5 billion of shares and convertibles, protecting the company from ratings cuts but not satisfying some analysts who wanted the company to raise more. Go to Article from Reuters via The New York Times» Read More Add a comment Visa has two big challenges ahead. The first is, of course, its plan to launch what is expected to be the biggest initial public offering in U.S. history, with a record $18 billion in the works. Go to Article from Legal Times via Law.com» Read More Add a comment China Railway Construction, builder of more than half the nation's rail links since 1949, raised the maximum 18.3 billion Hong Kong dollars ($2.35 billion) sought in a Hong Kong initial stock sale, Bloomberg News reported. Go to Article from Bloomberg News» Read More Add a comment Back to Top VENTURE CAPITAL Steven P. Jobs, Apple's chief executive, is hoping to expand the iPhone's appeal by luring software developers to create programs for it and venture capital firm Kleiner Perkins Caufield & Byers is lending a hand. Go to Article from The New York Times» Go to Article from Teh San Jose Mercury News» Read More Add a comment Back to Top LEGAL The credit markets came under renewed stress Thursday as investors sought absolute safety and even moved away from debt issued by Fannie Mae and Freddie Mac, the government-sponsored mortgage lending enterprises. Go to Article from The New York Times» Read More Add a comment The story of Syms's delisting provides some evidence for those who see value in the obligations and protections imposed by federal securities laws and the Sarbanes-Oxley Act in particular, according to The Deal Professor. Go to Item from The Deal Professor» Read More Add a comment Sallie Mae is flunking on Wall Street. Shares of the company, the nation's largest source of student loans, have lost more than half their value since December. Go to Article from The New York Times» Read More Add a comment It is not often that a major international bank admits it is violating well-established accounting rules, but that is what Societe Generale has done in accounting for the fraud that caused the bank to lose 6.4 billion euros -- now worth about $9.7 billion -- in January, argues Floyd Norris in The New York Times. Go to Article from The New York Times» Read More Add a comment Get home delivery of The New York Times for as low as $3.15 a week.

SEARCH DEALBOOK SITE DealBook | E-mail Preferences Help | Advertising Opportunities Visa and 'Equanomics' The Rev. Jesse Jackson says minority-owned underwriters should get a bigger piece of Visa's record-setting offering. (44 comments) More» The Refrain That Follows Bronfman As Warner Music's stock has tumbled, a classic redemption story has taken a regrettable twist. More» What Price Scrabulous? Negotiations over the popular Facebook application may have become a numbers game. (87 comments) More» Revolving Door The latest hires, promotions and departures at Bear, Cowen, UBS and more. More» The Deal Professor A blog-within-a-blog that looks at mergers, private equity and corporate governance through a legal lens, written by Steven M. Davidoff, a professor at Wayne State University Law School and a former lawyer at Shearman & Sterling. More» Live From Super Return 2008 Some of the biggest names in private equity gathered in Munich to share strategies for weathering the industry's recent downturn. More» DealBook Talks Yahoo DealBook's Andrew Ross Sorkin discussed Microsoft's offer for the Internet giant on "Charlie Rose." Watch here. More» Microsoft's Yahoo Bid Full coverage of Microsoft's unsolicited $44.6 billion offer for Yahoo, what it means and how it might play out. More» DealBook for BlackBerry For readers who are BlackBerry addicts, we now offer DealBook for BlackBerry. With one-click access to DealBook -- formatted for your device -- it's easy to check the latest deal news throughout the day. You can install the DealBook shortcut by visiting mobile.nytimes.com/bbinstall directly from your BlackBerry or by sending the text message "bb install" to 698698. More information on DealBook for BlackBerry. News By Industry Airlines / Autos Basic Industries Consumer Goods Energy / Utilities Financial Services Food & Beverage Healthcare Media Real Estate Retail / Leisure Technology Telecom Tools & Resources GET QUOTES Look Up Symbol RESEARCH SUITE Portfolio Company Research U.S. Markets International Markets Mutual Funds SEND A TIP OR FEEDBACK E-mail us at dealbook@nytimes.com Dealboard

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