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"I don't see how to get this statute to work." -- Supreme Court Justice Stephen Breyer, speaking of the Americans with Disabilities Act of 1990EDITED BY ROBERT McNATTReturn to top

Enough Spin-Offs to Make You Dizzy

UNDER PRESSURE TO INCREASE SHAREHOLDER VALUE, many of Europe's largest corporations are spinning off operations that have little to do with their core businesses and profiting handsomely, especially with newly formed high-tech companies. The divestitures represent a sharp change in thinking from a decade ago, say analysts, when companies wanted diverse operations to help reduce the effects of the business cycle.

Now, companies want to stay focused. In June, chemical giant Bayer plans to sell its AGFA unit for $3.9 billion. AGFA gets most of its sales from digital imaging products such as medical scanners. DaimlerChrysler has already spun off its 10% stake in fledgling phone network debitel, which is now valued at about $2.5 billion. Veba, a German conglomerate, plans to list its Stinnes division, a logistics supplier, on the Frankfurt Exchange to raise about $3.3 billion. Meanwhile, Siemens plans to spin off its semiconductor unit, Infineon, for $5.4 billion.

The strong demand for tech stocks helps. Shares on Germany's tech-heavy Neuer Markt have climbed 54% in the past six months. Add in record-low bond yields and strong interest from foreign investors and the spin-off craze could last for months.EDITED BY ROBERT McNATTReturn to top

TABLE

Prizes on the Block

PARENT COMPANY SPIN-OFF MARKET

VALUE*

BAYER AGFA $3.9

VEBA Stinnes 3.3

SIEMENS Infineon 5.4

DAIMLERCHRYSLER debitel 2.5

*Estimated in billions

DATA: BUSINESS WEEK, ANALYSTS' ESTIMATES

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Goldman's Rainbow IPO

GOLDMAN SACHS HAS AGREED TO INCLUDE 17 MINORITY-OWNED AND THREE WOMEN-OWNED FIRMS among the 130-odd underwriters handling its historic initial public offering. Many of the 20 firms were included as underwriters, say sources close to Goldman, after talks with the Reverend Jesse Jackson, who has recently pushed for minorities to have a stronger presence on Wall Street.

Two of the firms, Muriel Siebert and the black-owned Utendahl Capital Partners, sit in the bracket just below such co-managers as Merrill Lynch and Bear Stearns. Most of the others will participate at the mezzanine level, where 76 firms handle sales of shares to the public.

That's good, but not yet good enough says Jackson, who wanted a minority-owned firm among the 16 directing the IPO. "We need to be at the top, as co-managers," the civil-rights activist says.

The IPO, Wall Street's largest ever, is scheduled for May 3 and is expected to raise about $3 billion. The underwriters will split up to $150 million in fees, so participating will be profitable. But the opportunity later to play on the prestige of being included in such a high-profile deal may prove to be far more valuable than the fees alone.EDITED BY ROBERT McNATTReturn to top


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