THERE are two birthdays coming up in August that I’d like to mention in this column. (No, not mine. That’s in May and I’ll give you my sizes closer to the date in case you want to surprise me.)
The birthdays I’m referring to are the third for the Sarbanes-Oxley Act and the 15th for the World Wide Web.
So what do these two events have in common? They both represent new and better ways of disseminating information.
In the case of Sarbanes-Oxley, the act was created so that corporate executives would be forced to give truthful information about their companies – or else.
The law was a direct response to the shenanigans that went on during the late 1990s when companies were not truly accountable for misstatements, and investors ultimately suffered great financial losses because of this.
Sarbanes-Oxley could now be in trouble because, first, corporations don’t like it; second, there’s a new guy coming in to run the Securities & Exchange Commission who is “friendlier,” it is said, to business and, third, investors have short memories and weak voices.
But Sarbanes-Oxley was, in a way, also a response to the other birthday boy.
The World Wide Web – which some say was born in Aug. 1990 when scientists Tim Berner-Lee and Robert Cailliau came up with the information-sharing idea – also made something like Sarbanes-Oxley necessary.
Throughout the ’90s, much of the corporate information going out over the Internet was false. The Internet was a Petri dish for investment scams.
And a healthy dose of truthfulness, which is what Sarbanes-Oxley was serving up, was the best remedy.
So, Happy Birthday to the WWW, and I hope Sarbanes-Oxley lives to a ripe old age.
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So how are Harvey and Bob Weinstein doing with the money-raising efforts for their post-Miramax movie venture? Wall Street sources say Goldman Sachs, the Wall Street firm searching for the dough, is almost done – with $1 billion in commitments already.
But other sources say a lot of the money came from the Far East because American investors were skittish about investing in expensive movies.
“Private equity deals want to buy cash flow,” says one Hollywooder familiar with the Weinsteins’ plight.
Investors want to invest in companies that already have movies to sell. Making movies is strictly a cash drain.
Miramax was extremely successful under the Weinsteins. The fact that they’d have any trouble raising money says a lot about the fickleness of the movie industry.
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This would be the perfect time for the Chinese to raise their offer to acquire Unocal – at least according to those who love a good conspiracy. Why?
Because starting next week the Congress goes on its summer recess and many of those annoying political questions – like should Communists own a strategic U.S. company – will be forgotten in the rush to attend local barbecues and ribbon cuttings.
The Chinese company Cnooc already expressed a willingness to raise its offer for Unocal to $69 a share from $67, but only if Unocal picked up the $500 million tab for breaking its deal with Chevron, according to proxy material released this week.
Since Unocal has 272 million shares outstanding, the net effect of the boost in price to $69 would have been a mere $44 million.
As of yesterday, Chevron’s offer was worth about $63.40 a share, which was a buck and a quarter below the current market price.
Traders figure the Chinese would have to go to $69 a share, no strings attached, to get back into the game.