When he became CEO of Interpublic Group (IPG) in February, David Bell warned that turning around the troubled ad giant could be tough. He wasn't kidding. On Nov. 11, IPG reported a net loss of $327.1 million for the third quarter on a 2.3% gain in revenues, to $1.4 billion. Among the nasty surprises: a noncash charge of $221 million to wipe out goodwill at troubled sports marketer Octagon (IPG), and a $127.6 million charge to cover potential costs of shareholder lawsuits. Bell also put $57.1 million into an ongoing restructuring, now likely to cost $250 million. Although IPG's revenue from existing clients declined 1.7% at a time when the ad business seems to be recovering at last, Bell put the best face on things. He pointed to a healthy influx of $850 million in new business and noted that no major clients defected in the third quarter. Investors, however, were less forgiving. Fearing big losses, they sent the stock tumbling 6.2% the day before IPG reported. It recovered only slightly once the news was out. After U.S. manufacturing companies and labor unions griped about China's growing $110 billion trade surplus with the U.S., China's Vice-Minister of Trade, Ma Xiuhong, dropped by Detroit on Nov. 12 with a little good news. He announced a deal that allows General Motors (GM) and Ford Motor (F) to ship thousands of cars to China tariff-free. GM will begin shipping Buicks and Cadillacs such as the XLR roadster, CTS sedan, and SRX sport-utility vehicle to China, as well as parts to make more Buicks at its Shanghai plant. GM is considering the Hummer H2 for China, too. Ford also plans to ship 5,250 vehicles, but it has not decided which models to send. Sport utilities are a likely candidate. Oracle's (ORCL) $7.3 billion hostile takeover bid of rival Peoplesoft (PSFT) may be on the ropes. On Nov. 10, the database giant said in a Delaware court filing that a takeover would not be "economically reasonable" if Peoplesoft is allowed to continue a program that guarantees customers a payment of up to five times the cost of software purchased if Peoplesoft gets taken over. Oracle has asked the courts to bar Peoplesoft from making the guarantee. And even if a judge sides with Oracle, the Justice Dept. could oppose the deal on anticompetitive grounds. A Justice spokesperson declined to comment on a USA Today report that it is preparing to oppose the merger. Oracle CEO Larry Ellison has said that if the government blocks the deal, he'll drop it. However, an Oracle spokesperson said the company remains confident it will get the green light. Vivendi Universal (V) signed new contracts with Imagine Entertainment and DreamWorks SKG, helping to secure programming for its new owner, General Electric's (GE) NBC. Vivendi added three years to the two years remaining on its deal with director Ron Howard's Imagine, which made such hits as A Beautiful Mind and Dr. Seuss' How the Grinch Stole Christmas for Universal. Vivendi also extended through 2010 Universal's contract to distribute films and DVDs for DreamWorks. Vivendi also agreed to pay $100 million to buy Dreamworks' records unit, home to Toby Keith and Nelly Furtado. Merck (MRK) pulled the plug on a promising experimental treatment for depression. On Nov. 12, it announced that the drug, called Emend, had failed to ease the symptoms of depression in a late-stage clinical trial. Merck already sells Emend as a treatment for nausea caused by chemotherapy, but approval for depression would have transformed it from a niche product to a potential $1 billion-a-year blockbuster. And it would have gone a long way toward easing the pain when Merck's cholesterol-fighting hit drug Zocor loses its patent protection in 2006. -- Federated Department Stores (FD) reported lower earnings for the third quarter.
-- Neither party won damages in the Rosie O'Donnell-Gruner + Jahrfight.
-- Standard & Poor's (MHP) cut its rating on Ford's debt to one notch above junk. Highflier EchoStar Communications (DISH) fell 13%, to $32.05, on Nov. 11, after its $35.1 million third-quarter profit missed Wall Street expectations. Analysts also worried that with only 285,000 new subscribers in the quarter, it is losing market share to rival DirecTV (GMH).