Executive Business Briefing

Here is a look at more of Monday's top business stories:

Southern Union buys CMS Panhandle Cos.

WILKES-BARRE, Pa., Dec. 23 (UPI) -- Southern Union Co. along with AIG Highstar Capital L.P., a private equity fund, have reached a definitive agreement to acquire CMS Panhandle Companies from CMS Energy for $662 million.

The buyers will also take over $1.17 billion of debt, making the total value of deal around $1.8 billion.

The deal has been approved by the boards of directors of all companies and will close following clearance by the Federal Trade Commission under the Hart-Scott-Rodino Act and certain state regulatory approvals.

George L. Lindemann, Southern Union's chairman and chief executive officer, said, "This acquisition further delivers on our stated strategy to re-deploy our assets and capitalize on opportunities in the energy market."

Thomas Karam, president and chief operating officer of Southern Union, added, "CMS Panhandle is a well run and stable business, which will be accretive to our earnings in the first year. We expect to execute a smooth and seamless transition. We welcome the chance to work with the Panhandle's dedicated and experienced management team."

The CMS Panhandle Companies include CMS Panhandle Eastern Pipe Line Co., CMS Trunkline Gas Co., CMS Trunkline LNG Co., which operates an LNG terminal complex at Lake Charles, La., and CMS Sea Robin Pipeline Co.

The CMS Panhandle operate almost 11,000 miles of mainline natural gas pipeline extending from the Gulf of Mexico to the Midwest and Canada.

These pipelines access the major natural gas supply regions of the Louisiana and Texas Gulf Coasts as well as the Midcontinent and Rocky Mountains. The pipelines have a combined peak day delivery capacity of 5.4 billion cubic feet per day, 88 billion cubic feet of underground storage capacity and 6.3 billion cubic feet of above ground LNG storage facilities.

Bank of America sees higher results

CHARLOTTE, N.C., Dec. 23 (UPI) -- Bank of America Corp., the second-largest banking company in the United States by market capitalization, said it expects to post a net income of $5.87 to $5.92 a share for 2002 as a result of a tax settlement reached with the Internal Revenue Service.

Analysts on Wall Street had been expecting the lender to report a net income of $5.68 a share, according to Thomson First Call.

Bank of America also said it expects net income of $9.17 billion to $9.27 billion.

The lender said it will record additional after-tax income of $488 million in the fourth quarter from a reduction in previously accrued taxes. The bank said it reached a broad settlement with the Internal Revenue Service on its federal income tax liability, generally covering tax years from 1984 to 1999 but including returns as far back as 1971.

As a result of the settlement, Bank of America said it will pay an additional $30 million.

The bank said it expects a provision for loan losses and net charge-offs in the fourth quarter of $1.2 billion, which it said is higher than in previous quarters.

Bank of America said the primary factors driving higher net charge-offs were losses associated with the bankruptcy of a major airline as well as increased weakness in the utilities sector.

Ken Lewis, chairman and chief executive officer, said, "We have been talking about event risk for most of this year. Although we could not predict when it would hit, we have been fully prepared to deal with events such as this bankruptcy and are doing so aggressively.

"The diversity and earning strength of our company enables us to address credit issues as they arise and still report impressive earnings, which should be around $2.5 billion in the fourth quarter," Lewis said. "Our major businesses are performing well. While economic conditions remain uncertain, we expect to continue to grow our earnings next year and are comfortable with the consensus estimates for 2003."

Pitney Bowes to take $100 million charge

STAMFORD, Conn., Dec. 23 (UPI) -- Pitney Bowes Inc. said it will take a charge of $100 million in the fourth quarter for commercial aircraft leases with US Airways Group Inc. and United Air Lines.

The company, whose meters are a staple in corporate mail rooms, said the pretax non-cash charge will be about 26 cents a diluted share for the quarter.

The charge reflects recent events concerning US Airways and United including the progress of negotiations with both airlines and the decision of United to file for bankruptcy, Pitney Bowes said.

The company also said it expects that loss of income from its leases with US Airways and United to be about 2 cents a diluted share in 2003.

Pitney Bowes will report its fourth quarter earnings on Jan. 28.