NATIONAL

UNITED, PILOTS’ NEGOTIATORS REACH TENTATIVE CONTRACT AGREEMENT

Negotiators for United Airlines and its pilots’ union have reached a tentative agreement on a new contract, the two sides said yesterday. The agreement makes the pilots the first of United’s four big unions to come to initial terms on the latest round of cuts at the bankrupt airline. All four have balked at United’s proposals this fall but risk having the company’s terms imposed in bankruptcy court if they do not reach a settlement. The deal has yet to be approved by the union’s leadership, which has scheduled a meeting tomorrow to decide. Details were not disclosed. “United is pleased to have reached a tentative agreement with the Air Line Pilots Association on the cost savings the company needs to secure the exit financing necessary to restructure successfully,” company spokeswoman Jean Medina said. The pilots’ union informed its members of the agreement Monday. “We do have a tentative agreement with the company,” union spokesman Herb Hunter said. The deal, if signed off on by union leaders and then ratified by rank-and-file pilots, could help enable United to avoid a potentially devastating labor showdown. Difficult negotiations with unions representing the mechanics, flight attendants, and ramp and public contact workers remain unresolved, however.

– Associated Press

GE’S IMMELT SAYS PROFIT TO RISE 13%-17% NEXT YEAR

General Electric’s chief executive, Jeffrey Immelt, said profit will rise as much as 17% next year and return to growth of at least 10% annually “for the foreseeable future” as new businesses spur sales.

Profit at the world’s biggest company by market value will increase next year to $1.75 to $1.83 a share from $1.57 to $1.60 this year, Mr. Immelt said in his annual presentation to investors and analysts in New York yesterday. In 2006, profit will rise as much as 15%, he said.

Mr. Immelt, 48, has expanded into faster-growing areas like health care, security, and consumer finance while selling lower-return units like insurance.

Areas where profit growth slowed over three years, energy equipment and jet engines, are projected to rise faster on service sales and economic growth. Sales will grow 10 percent next year from more than $150 billion in 2004, he said.

“We really think we have today a stronger and faster-growing GE,” Mr. Immelt told investors. “The thing to like about GE right now: 2005 performance is going to be very strong and very broad-based.”

– Bloomberg News

BANK OF AMERICA NAMES LEWIS CHAIRMAN; GIFFORD RETIRES

Bank of America, the third-largest American bank, said that its chairman, Charles “Chad” Gifford, will retire at the end of January and will remain a member of the board of directors.

The bank’s chief executive, Kenneth Lewis, 57, was named chairman by the board in a meeting yesterday, the Charlotte, N.C.-based bank said in a statement.

Mr. Gifford, 62, was chairman and CEO of FleetBoston Financial when Bank of America agreed to buy the company in October 2003. His retirement follows the April resignation of president Eugene McQuade, 55, who was Fleet’s president and chief operating officer before Bank of America completed the $48 billion takeover April 1. Mr. Lewis has been a board director since 1997 and was chairman from April 2001 to March 2004, when Mr. Gifford assumed the title.

– Bloomberg News

REGULATORY

FRANKLIN SAYS NASD RECOMMENDS DISCIPLINARY ACTION

Franklin Resources, the biggest publicly traded American mutual fund company by stock market value, said the NASD recommended disciplinary action against one of its units, claiming it violated rules on brokerage commissions.

The Washington-based NASD made the “preliminary determination to recommend” action against Franklin/Templeton Distributors last week, Franklin said in a filing with the Securities and Exchange Commission yesterday. The company, located in San Mateo, Calif., said the “charges are unwarranted.”

American regulators have been investigating hidden fee agreements in which mutual fund companies use fund assets to pay brokers for preferential marketing. They argue the arrangements can cause conflicts of interest and raise costs for shareholders, and should be divulged. Monday, Franklin agreed to pay $20 million to settle SEC allegations that its distribution and advisory divisions failed to disclose such fees.

– Bloomberg News

TECHNOLOGY

VERITAS SHARES JUMP ON REPORT OF TALKS WITH SYMANTEC

Veritas Soft ware Corporation shares rose 8.7% after the New York Times said Symantec Corporation is in talks to buy the company for more than $13 billion. Symantec shares fell 16% as analysts said the price may be high.

Symantec, the world’s largest maker of security software, may announce the purchase as early as this week, the newspaper said yesterday, citing unidentified people close to the negotiations.

The combination would boost Symantec’s effort to expand into products that store, retrieve and recover data.

Best known for its Norton anti-virus software, Cupertino, Calif.-based Symantec has made at least 12 acquisitions since 2000, and this would be the second biggest ever in the software industry. The company has benefited from increasing demand for security programs after viruses such as Sasser, Netsky, and My-Doom crippled networks this year.

A purchase of that size would eclipse Oracle’s planned $10.3 billion acquisition of PeopleSoft and would be the second-largest software buyout, after the $13.7 billion McKesson paid for HBO & Company in 1998.

The deal would value Veritas at about $31 a share, based on the Times report. Veritas shares traded at about $17 in early September.

– Bloomberg News s

WALL STREET

WALL STREET PRETAX ’04 PROFIT PROJECTIONS RAISED

Wall Street’s pretax profits in 2004 will be slightly higher than previously projected, according to the Securities Industry Association, a trade group.

Pretax profits at broker-dealers should come in at $19.5 billion by the end of the year, up from a projection of $18.9 billion made in September, the SIA said Tuesday. The industry’s pretax profits still are expected to be below those in 2003, when the firms earned $24.1 billion, but above results in both 2002 and 2001, which were $12.1 billion and $16 billion, respectively. The peak for industry earnings was in 2000, when pretax profits came in at $31.6 billion

The SIA estimates that gross revenue in 2004 will be $219.6 billion, 3.2% higher than in 2003, indicating the industry isn’t seeing the same benefits from cost-cutting that helped drive profits a year ago. Indeed, many analysts and industry officials had said that the boost from cost-cutting and layoffs would be a temporary one, and the number of employees has risen since May 2003 as firms gear up for an expected resurgence of business in many areas. The SIA estimates that employment has risen 3.6% in 2004, with the latest employment data ending in November.

The Securities Industry Association’s senior vice president and chief economist, Frank Fernandez, said that while early indications show better-than-expected results for the fourth quarter, firms are expected to continue on a cautious path.

“The firms are still waiting to see more signs of a continued recovery before increasing their budgets,” said Mr. Fernandez. “Compensation and other expenses will still be tightly controlled.”

– Dow Jones Newswires