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JANUARY 19, 2004
Edited by Anne Newman William Lauder: Grandma's Pride  After a four-year hiatus from the corner office of Estée Lauder (EL
), a member of the Lauder family will once again run the $5 billion cosmetics giant. William, 43, grandson of founder Estée and son of former CEO and current Chairman Leonard, will become CEO on July 1. He replaces Fred Langhammer, who in 2000 became the sole outsider ever to run the 58-year-old New York-based company. Lauder, whom analysts credit with smart new products and distribution, inherits a strong company from Langhammer, who becomes chairman of global affairs. Operating income rose 15% in the year ended last June, and the stock, which is 52%-owned by the family, is up 43% in the past 12 months. Lauder, who has been chief operating officer for the past year, sees room to expand in fast-growing markets like China and Eastern Europe. He is confident he's up to the job: "I joined the Estée Lauder companies 43 years ago. I've only been paid for it the last 17 years," he jokes. By Nanette Byrnes Spiffing Up The NYSE Interim New York Stock Exchange Chairman John Reed is fast paring his to-do list. On Jan. 5, he met with New York Attorney General Eliot Spitzer, who agreed to help recoup some of the $140 million the NYSE paid ex-Chairman Richard Grasso. For now, Spitzer plans only to review an internal report on Grasso's package, a source familiar with the talks says, and may meet with Grasso to urge him to repay some. And on Jan. 8, the NYSE board was expected to name ex-NASDAQ Stock Market President Richard Ketchum as its new top regulatory officer. Ketchum had been general counsel to Citigroup's (C ) investment banking unit after being passed over for NASDAQ's top post. Reed earlier recruited John Thain from Goldman Sachs (GS ) to become CEO on Jan. 15. Still to come: a new chairman.   Boeing's New Mr. Clean  Boeing (BA
) also moved closer this week toward cleaning up its image. On Jan. 6, the tarnished aerospace giant's board named James Bell to take over as chief financial officer. Bell had been acting CFO since the Nov. 24 firing of his predecessor, Michael Sears, for ethical misconduct. Following last year's bid-rigging and other scandals, Bell will need to reassure investors that Boeing is focused on financial openness and won't overpay for acquisitions, as it has in the past. Bell, 55, appears well suited for the high-stakes job: He's a 31-year veteran of corporate finance in the aerospace industry, and for the last three years he has served as Boeing's controller. CEO Harry Stonecipher calls Bell "a proven, highly skilled manager who has intimate knowledge of our strategy and champions fiscal transparency." A Call For Sky Armor The Homeland Security Dept. asked three large companies to produce designs for protecting commercial airliners from missile attacks. Defense contractors BAE Systems and Northrop Grumman (NOC ) are exploring ways to equip planes with lasers that could deflect shoulder-fired missiles. And United Airlines (UAL ) has teamed with a number of defense companies to develop a system using decoys to distract missiles. While some such systems are currently deployed on military aircraft, equipping the nation's 6,800 commercial jets could cost as much as $1 million per plane. iPod's Baby Brother Apple Computer's (AAPL ) diminutive iPod digital music player is looking more and more like a blockbuster. Apple sold 730,000 of the $300-plus devices in the December quarter, roaring past analysts' estimates of 500,000 or so. On Jan. 5, Apple unveiled the $249 iPod Mini to expand downmarket. Small as a business card, it holds 1,000 songs on a one-inch hard drive, vs. up to 10,000 songs on the larger iPods. Critics call it too pricey. But CEO Steve Jobs thinks Apple can gain share and juicy profit margins, too: "I don't think anyone is going to beat us," he says. Et Cetera... -- The government lifted its ban on MCI (MCI ) bidding for new federal contracts. -- Duke Energy (DUK ) will book a $3.3 billion fourth-quarter charge, partly to scale back its merchant energy business. -- Sales of cold remedies will help Procter & Gamble (PG ) top its second-quarter estimates. Closing Bell: Nortel Networks  Nortel Networks' (NT
) stock surged 19%, to $5.68, on Jan. 7 after Verizon Communications (VZ
) agreed to buy voice-over-Internet technology from the telecom-gear maker. Analysts' upgrades followed the deal, which some estimated may be worth $1 billion over five years.
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