■ PETROCHEMICALS
Ho Tung to leave Kuokuang
Ho Tung Chemical Corp (和桐化學) on Friday decided to pull out of joint venture Kuokuang Petrochemical Technology Co (國光石化科技), which is involved in a NT$401 million (US$12.3 million) chemical plant project. The project has been delayed by a strict environmental evaluation being conducted by the government. Appalled at the delay, Ho Tung is poised to release its 3 percent stake in Kuokuang, company president Yang Yu-jay (楊猷傑) said on Friday. Despite being the venture's smallest shareholder, Ho Tung's move could trigger a domino effect among the five other private-sector shareholders, which own a combined 54 percent stake. Chinese Petroleum Corp, Taiwan (CPC, 台灣中油) owns a stake of 43 percent in Kuokuang. Minister of Economic Affairs Steve Chen (陳瑞隆) responded by vowing to facilitate the project's completion. He said his ministry would not allow the project to fall apart. CPC said it would either seek a new partner or take over Ho Tung's 3 percent stake itself.
■ MORTGAGES
Investor sues Merrill Lynch
Merrill Lynch & Co was sued by a former First Republic Bank shareholder, claiming the company hid losses related to subprime mortgages until after it acquired the bank. Merrill Lynch, which announced US$8.4 billion in writedowns in October because of mortgage-related investments and corporate loans, failed to disclose that it was overexposed to risky subprime loans in the months leading up to the Sept. 21 completion of the First Republic Bank buyout, according to the complaint filed on Friday in federal court in New York. Merrill spokesman Bill Halldin said in an e-mail: "We made all appropriate disclosures."
■ BANKING
UBS to drop Indian offer
UBS AG, shaken by the US subprime crisis, said on Friday it would drop its plans for acquiring India's Standard Chartered Bank. Switzerland's largest bank said that after a sale and purchase agreement made last year had expired, a decision was reached not to pursue further negotiations on the deal. UBS had planned a complete take over of both Standard Chartered Asset Management Company Private Ltd and Standard Chartered Trustee Company Private Ltd for an expected amount of 147 million Swiss francs (US$128 million).
■ SOFTWARE
Microsoft rejects claim
US states pressing for continued scrutiny of Microsoft Corp's business practices failed to support their argument with evidence, the software maker said in a court filing on Friday. Microsoft, which was found to be using its operating system dominance to quash other types of competing software, has operated since 2002 under the terms of an antitrust settlement struck with the federal government and 17 US states.
■ AVIATION
Air China to lose chairman
Air China Ltd (中國國際航空), the world's largest carrier by value, said company chairman Li Jiaxiang (李家祥) would leave the position "very soon" for an appointment as China's civil aviation regulator. "It'll take a few days to complete the procedure," Huang Bin (黃斌), board secretary of Air China, said yesterday in a telephone interview. "The announcement may come after the New Year's holiday." Li would replace Yang Yuanyuan (楊元元) as director of the China Administration of Civil Aviation.
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