Reverse Spin: Here’s one deal GE can’t bring to life

Will they merge or not? That is the multibillion-dollar question.

General Electric Co. and Honeywell International Corp. said Thursday they just aren’t getting that loving feeling from European regulators about their proposed $42.3 billion merger – despite a last-ditch bid to save the deal by offering to sell $2.2 billion in assets. While GE chief executive Jack Welch maintains the companies’ divestiture offer is final, European antitrust officials want additional concessions totaling more than double those being proposed by GE, based in Fairfield, Conn., and Honeywell in Morristown, N.J.

On Friday, President Bush stepped into the trans-Atlantic catfight by saying he is concerned about Europe’s opposition to the deal. Mr. Bush, on the fourth stop of a five-country European tour, said he had raised the deal with European counterparts at the appropriate level.

“We’re in a poker game here, and the game is far from over,” said Cai Von Rumohr, an analyst with SG Cowen Securities Corp. in New York. “I don’t know whether Europe is going to want to be seen as submarining a big U.S. deal, but it has looked over time that the EU was going to take a hard look at this.”

And the cuts keep coming

And you thought Freddy Kruger did a lot of slashing?

On Wednesday, companies running the gamut from film and camera maker Polaroid Corp. of Cambridge, Mass., to dessert queen Sara Lee Corp. in Chicago to semiconductor manufacturer Integrated Device Technology Inc. in Santa Clara, Calif., announced they were slashing jobs.

Also on Wednesday, paper and wood products giant Georgia-Pacific Corp. of Atlanta said it will cut jobs as it closes three plants and curtails production at others. The latest round of layoffs ends a recent lull in job shrinkage.

On Friday, Nortel Networks Inc., which in April announced plans to cut 20,000 jobs, said it is cutting an additional 10,000, and predicted a $19.2 billion second-quarter loss amid slowing demand for its equipment that moves Internet traffic.

“The second round of layoffs may put downward pressure on consumer confidence,” says Steven Wood, chief economist at FinancialOxygen Inc., an economic advisory firm based in Walnut Creek, Calif. “I think consumers will be a little harder pressed to be as optimistic about the economy.”

SEC squeezes firm on margin loans

All-Tech Direct Inc., one of the nation’s biggest day trading firms, and some of its executives agreed to shell out more than $600,000 in fines to settle charges of improper loans to customers and false advertising, the Securities and Exchange Commission said Wednesday.

Montvale, N.J.-based All-Tech, which did not admit or deny the allegations, also agreed to hire an independent consultant to review its margin lending, the SEC said.

In a case filed in February, the SEC alleged that All-Tech had made about 100 margin loans over eight months totaling $3.6 million in violation of federal margin lending rules.

Magellan raises stake in tech

Fidelity Investments’ $88.7 billion Magellan Fund raised its stake in technology for the first time in eight months and cut its cash holdings in half, according to Boston-based Fidelity’s Mutual Fund Guide, released Tuesday.

The world’s biggest mutual fund, managed by Robert Stansky, raised its investments in information technology to 13.8% of assets in April, from 11.6% in March. Cash fell to 2.5% of assets in April, from 5.1% in March.