In Business This Week
Edited by Monica Roman
HEADLINER
Craig Venter: Decoupling a Gene Decoder
The man who led the way to reading humanity's genetic code, J.Craig Venter, stepped down on Jan. 22 as president of Celera Genomics (CRA
), which he helped found in 1998 to undertake the historic gene decoding. As Celera began to shift its focus from selling genetic information to discovering its own drugs, "we realized how much we didn't know about this drug business," explains Tony White, CEO of Applera, Celera's parent.
So White decided that Rockville (Md.)-based Celera needed an experienced drug-industry hand at the helm, which left little room for the irrepressible Venter. In addition, the two forceful men often didn't see eye to eye. "Craig always has his mind on the lofty science, which doesn't mesh very well with business," says fellow gene sequencer Richard Gibbs of the Baylor College of Medicine. "And he doesn't like to be told what to do."
Venter, who was on vacation and declined comment, will become chair of Celera's scientific advisory board. But the search for his replacement is only beginning.
By John Carey
A Fast Break from McDonald's
McDonald's (MCD
) has long suffered from high turnover among entry-level employees. Now, the revolving door has reached the top of the fast-food operator. Barely six months after taking responsibility for all McDonald's outlets in the Americas, Alan Feldman, 49, resigned on Jan. 21. His move came only six weeks after Jeffrey Kindler, who headed the company's non-McDonald's outlets, resigned to join Pfizer (PFE
).
McDonald's earnings have declined for four quarters in a row, in large part because of sluggish sales in the U.S. amid consumer grumbling about poor service and food. Feldman has no immediate job plans. His duties were assigned to James Skinner, 57, who was promoted to president and chief operating officer of McDonald's 29,000-unit restaurant group. A 31-year McDonald's veteran, Skinner had been in charge of all Mickey D's outside the Western hemisphere.
Making Peace at Credit Suisse
John Mack was hired in July as CEO of Credit Suisse First Boston to end a major embarrassment: probes by the Securities & Exchange Commission, the National Association of Securities Dealers, and the Justice Dept. into how CSFB's technology group underwrote and distributed shares in initial public offerings. On Jan. 22, Mack succeeded. Without admitting or denying regulators' allegations, CSFB agreed to pay $100 million to settle charges that it siphoned "tens of millions of dollars of customers' profits" in exchange for IPO shares. It also agreed to discipline the employees involved in the matter, although it did not specify the number or their names.
Compaq Is in the Black
After a dismal third quarter, Compaq Computer's (CPQ
) outlook for the fourth period was conservative. But no one knew quite how low it had set the bar, until Jan. 16. The Houston computer maker had projected a loss but turned in a $92 million profit for the fourth quarter. Executives attributed the surprising performance to stronger-than-expected demand for home PCs, a 31% surge in European revenues, and continued cost-cutting. While Compaq still expects its usual first-quarter sales decline, the company says corporate demand for tech gear could rebound by midyear. More important, the strong results could mute critics of its troubled merger with Hewlett-Packard (HWP
), says CEO Michael Capellas. "The tide is turning," he says.
Weldon Gets the Nod at J&J
They're changing the guard at Johnson & Johnson (JNJ
). On Jan. 22, the health-care giant announced 53-year-old William Weldon would take over as chairman and chief executive officer in April, succeeding Ralph Larsen. Weldon began as a sales representative at J&J in 1971 and most recently has been running its $15 billion pharmaceutical operation. He will take over as J&J is posting healthy gains on big products, including its blockbuster anemia drug Procrit. Still, analysts caution Weldon must rev up J&J's research and development operation.
Wozniak and a Fledgling Woz
Stephen Wozniak, co-founder of Apple Computer (AAPL
), is back in the startup game. After more than a decade on the sidelines, Wozniak has unveiled a new venture, dubbed "Wheels of Zeus" based on his own nickname, "Woz." The Silicon Valley fledgling, which will focus on developing new wireless technologies for the consumer market, raised $6 million from venture capitalists. Wozniak says he hasn't put up any of his own cash so that he will be a more disciplined manager. "When my own money goes into something, I start to become careless," says Wozniak, who will serve as CEO of the startup.
Et Cetera...
-- Northwest (NWAC
) and American Airlines (AMR
) ended "blackout" periods for frequent-flier awards.
-- EMI paid Mariah Carey a $28 million fee to end its four-album deal with the singer.
-- Yahoo! (YHOO
) is expanding paid searches, a market dominated by Lexis Nexis.
CLOSING BELL
Timber!
Georgia-Pacific's (GP
) shares plunged 15% on Jan. 22, to 19.75, when a deal to sell its building products unit to Willamette Industries died. Instead, Willamette sold itself to rival Weyerhaeuser for $6.1 billion. Georgia-Pacific bondholders have reason to worry, too: Its debt will soon likely be downgraded to junk.
CLOSING BELL
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Copyright 2002 , by The McGraw-Hill Companies Inc. All rights reserved.
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