ENERGY

UNOCAL LIKELY TO APPROVE $17.3B BID FOR CHEVRON

Chevron Corporation’s $17.3 billion bid for Unocal Corporation is likely to win approval from a majority of shareholders next week amid doubt that a higher, all-cash offer from China’s Cnooc Limited can overcome opposition by American lawmakers. Chevron’s cash-and-stock plan to buy Unocal was backed by Institutional Shareholder Services, the biggest adviser to fund managers on merger votes. The group said Cnooc’s offer isn’t enough to offset the risk that American politicians could scuttle a deal.

“That recommendation is probably a pretty good sign of which way the vote will go,” a managing director at the investment banking firm Pritchard Capital Partners, Christopher Edmonds, said. “For some people this involves more than just price.” Investors are scheduled to vote August 10 on Chevron’s offer. Cnooc’s bid “is highly uncertain” and may no longer be “on the table,” the director of mergers and acquisition research at the ISS advisory firm, Chris Young, said.

– Bloomberg News

KINDER MORGAN BUYS TERASEN FOR $3.1 BILLION

Hoping to capitalize on a vast store of oil under development in western Canada, American pipeline operator Kinder Morgan Incorporated said yesterday it was purchasing Vancouver’s Terasen Incorporated for $3.1 billion in stock and cash and the assumption of $2.5 billion in debt. Houston-based Kinder Morgan already operates 35,000 miles of natural gas and oil pipelines across North America, as well as 145 storage terminals. But it lacks a significant presence in Alberta, Canada. Kinder Morgan’s move is the latest sign that one of the industry’s shrewdest players expects elevated prices to sustain development in and around Fort McMurray, the oil sands hub in Northern Alberta.

– Dow Jones Newswires

REGULATION

WTO RULES E.U. BANANA TARIFFS ILLEGAL

The World Trade Organization ruled yesterday that a new European Union tariff on imported bananas is illegal, siding with nine Latin American countries who said Brussels’s proposal would seriously limit their ability to export the fruit.

A WTO arbitration body backed a claim by the Latin American countries – including Brazil, Colombia, and Venezuela – who said the proposed E.U. tariff of $279 a ton would have a “devastating effect” on the development of their economies. The report concluded that new tariff “would not result in at least maintaining total market access” for Latin American exporters and queried Brussels’s methodology for arriving at the tariff figure.

The E.U. now has 10 days in which to enter into consultations with the Latin American group, which also includes Costa Rica, Ecuador, Guatemala, Honduras, Nicaragua, and Panama, the arbitrators’ report said.

– Associated Press

TELECOMMUNICATIONS

NOKIA NAMES SUCCESSOR TO CEO OLLILA

Nokia Corporation said yesterday that veteran manager Olli-Pekka Kallasvuo will take over as chief executive from Jorma Ollila next year, ending the guessing game over future leadership of the world’s largest mobile phone maker.

As head of the Finnish company’s main mobile phone unit and Nokia’s former chief financial officer, Mr. Kallasvuo had been viewed as a possible successor to Mr. Ollila. Analysts say his appointment suggests Nokia is unlikely to embark on a dramatic shift in strategy.

Mr. Kallasvuo, 52, will assume the CEO role on June 1, 2006, after becoming president and chief operating officer on October 1. He has sat on the executive board since 1990 and joined Nokia some 25 years ago. Mr. Ollila, 54, will become non-executive chairman in June, for a limited but unspecified number of years. Mr. Ollila signaled in January his intention to vacate the CEO post he has held since 1992 when his contract expires in 2006. He has transformed Nokia into the world’s largest mobile phone maker and a highly profitable company.

A Gartner analyst, Ben Wood, said Mr. Kallasvuo is a member of “Jorma’s gang” – one of the managers who has been with Mr. Ollila since he took the helm. Mr. Kallasvuo’s experience stands him in good stead to guide Nokia through the challenges it faces, such as shoring up its position in North America and combating margin pressure.

– Dow Jones Newswires

IN THE COURTS

ATTORNEYS IN TYCO TRIAL ARGUE SIZE OF PENALTIES

Sentencing for two former top Tyco International executives convicted of stealing hundreds of millions of dollars from the company has been postponed while lawyers prepare to argue how much money they must repay.

The former Tyco chief executive L. Dennis Kozlowski, and the former finance chief, Mark Swartz, were scheduled for sentencing tomorrow, then September 16, and now September 19 by agreement among the lawyers and the judge. Prosecutors, defense lawyers, and the defendants are still expected in court today for arguments that will likely include issues about how much the defendants will have to pay in penalties and restitution. Kozlowski, 58, and Swartz, 44, face up to 30 years in prison.

– Associated Press

MEDICINE

FDA APPROVES NEW LABEL FOR PFIZER’S CELEBREX

The Food and Drug Administration finalized a new label for Pfizer Incorporated’s arthritis drug Celebrex warning of increased cardiovascular risks such as heart attacks and strokes, the company said yesterday.

The “black box” warning is similar to ones that will be added to older painkillers such as ibuprofen and naproxen. The label change followed the February recommendation of an outside panel of medical experts convened by the FDA over concerns about whether drugs in the same class as Celebrex, as well as older painkillers, increased cardiovascular risks. Celebrex is the only so-called Cox-2 drug currently for sale in America. The FDA asked Pfizer to remove a similar drug, Bextra, from the market in April over safety concerns.

– Dow Jones Newswires