World Vision buys building in Federal Way

Pacific Northwest

Real estate

World Vision, the global Christian relief and anti-poverty organization, has bought another office building next door to its world headquarters in Federal Way.

The nonprofit paid $23.7 million this month for the 115,000-square-foot East Campus Corporate Park VI Building, according to county records.

Spokesman Dean Owen said World Vision already leases about one-third of the three-story building and decided buying it "would be a wise investment and excellent stewardship of the funds we receive."

World Vision doesn't intend to ask other tenants to leave, Owen said. He said the purchase should pay for itself in about a dozen years, because the organization will collect about $1 million a year in rents and save $700,000 a year in rent it had been paying for space in the building.

The seller of the property at 3455 S. 344th Way was LBA Realty of Irvine, Calif.

Northstar Neuroscience

Company lays off a third of its staff

Northstar Neuroscience laid off nearly a third of its work force Friday after disappointing results in its lead product's pivotal clinical trial.

About 58 employees will remain, the company said in a statement filed Wednesday with the Securities and Exchange Commission, signaling that about 27 were laid off. Termination benefits will cost the company about $775,000, the Seattle-based medical-equipment firm said.

Blist

Software maker raises $6.5 million

Software maker Blist said Wednesday that it has raised $6.5 million to speed up the development and marketing of its online social-database service.

The money comes from Frazier Technology Ventures, of Seattle, and Morgenthaler Ventures, headquartered in the Bay Area.

Blist aims to enable users to create communities around sophisticated databases.

Boeing

First of 4 tankers delivered to Japan

Boeing's 767 military-tanker program on Tuesday delivered the first air-refueling tanker for Japan's Air Force — just a week before the U.S. Air Force announces the winner of a massive contract to replace a large portion of its air-tanker fleet.

After a final review by Japanese Ministry of Defense officials, the airplane took off from Boeing's tanker-modification center in Wichita, Kan., on a 12-hour nonstop flight to Gifu, Japan, near Nagoya. Boeing said it will deliver the second Japan tanker immediately after formal acceptance of the first delivery.

Japan has ordered four of the 767 tankers. Boeing had to fix performance problems that arose during flight test, making the first delivery a year late.

Microsoft

Firm giving advice on Yahoo bows out

Microsoft replaced Simpson Thacher & Bartlett, one of the two legal advisers working on its bid for Yahoo, after the law firm determined it had a conflict.

The conflict couldn't be resolved, Microsoft said Wednesday in a statement. The company hired Sullivan & Cromwell to replace Simpson Thacher for advice on what would be the largest technology takeover.

"In order for us to fulfill our ethical obligations to each of our clients, it became necessary for us to withdraw from this representation," Philip "Pete" Ruegger, chairman of Simpson Thacher's executive committee, said in a separate statement.

Nautilus

Company shedding fitness-apparel line

Nautilus has agreed to sell Pearl iZumi, the apparel company it bought in an unsuccessful attempt to break into that segment of the fitness industry.

Shimano American is paying Vancouver, Wash.-based Nautilus $65.3 million in cash and assuming $4.2 million of long-term debt.

Nautilus bought Pearl iZumi in 2005 for $74 million in cash and debt.

The deal is expected to close March 31.

Weyerhaeuser

Two idled mills closing in Canada

Weyerhaeuser said it will permanently close two mills in Canada that have been idled since January 2007 and fire the 32 workers left.

The employees at the softwood stud mill in Carrot River and the softwood plywood mill in Hudson Bay will be terminated as of April 16, Federal Way-based Weyerhaeuser said Wednesday.

Nation and World

MySpace

Music service may be in works

News Corp. has approached the four major record labels to discuss launching an online music service through its popular MySpace social-networking site, music company executives familiar with the talks say.

The media conglomerate envisions a one-stop music service that offers content in various ways, including via free digital streams, as MP3 downloads and through a subscription plan, one of the executives said.

News Corp. proposed the service as a joint venture with the recording companies, which would receive an equity stake in the new company, the executive said.

The music executives spoke on condition of anonymity, saying they were not authorized to speak publicly.

News Corp. and MySpace declined to comment Wednesday.

MySpace has been a popular music hub for years, prompting established acts and unknown bands alike to create profile pages that often let visitors stream a few songs. Bands on MySpace also can sell downloads of original music directly through their profile pages.

Société Générale

Fraud probe finds no accomplices

Investigators of a $7 billion fraud at French bank Société Générale say the only trader in the scandal acted alone.

Investigators also said Wednesday they found no evidence of personal monetary gains made through the allegedly unauthorized positions taken by futures trader Jérôme Kerviel.

In an interim report, internal investigators at France's second-largest bank said procedures were followed correctly but failed to stop Kerviel, 31, who is accused of carrying out trades that forced the bank to mop up almost 5 billion euros ($7.33 billion) in losses.

Wine industry

Rising euro slows French exports

French wine and liquor exports, which rose to a record in 2007, are showing the first signs of a slowdown as the euro's rise against most currencies erode sales, a trade organization said.

Exports last year jumped 6.9 percent to $13.7 billion from 2006, France's Wine and Liquor Exports Federation said Wednesday. That is equivalent to the sales of 180 Airbus aircraft.

The euro's rise against currencies such the Chinese yuan and U.S. dollar dented sales in two of the biggest markets for French wines, the federation said. Wine and liquor are France's second-biggest exports after Airbus jets.

"It is important to underline that we've most likely hit a ceiling," Philippe Casteja, president of the federation, said in the statement. "The year 2008 is more of a concern. The dramatic weakening of currencies has started to weigh significantly on our prices and margins."

Sales to China, which more than tripled in the first-half of 2007, lost steam. For the full year, they doubled.

Overseas sales of champagne rose 10 percent compared with a 13 percent rise in the first half.

"The good figures in emerging markets like Asia and Russia may not compensate for the potential morose economic situation in the U.S. in 2008," Casteja said.

KKR

Fund late again on debt payment

A unit of Kohlberg Kravis Roberts (KKR), one of the world's largest private-equity firms, said Wednesday it has delayed payment on millions in loans and opened debt-restructuring talks with creditors.

It was the second time the fixed-income fund KKR Financial Holdings, an affiliate of the U.S. buyout firm, has put off repaying asset-backed commercial paper.

The fund, which invests in corporate debt and mortgages, did not give details of how much debt was affected or the amount of collateral securing the debt, according to a filing with the Securities and Exchange Commission.

KKR said it has postponed the repayment of some of its debt due Feb. 15 by two weeks to complete talks with noteholders.

KKR stock fell 28 cents, or 1.9 percent, to $14.25 Wednesday. It has been sliced in half during the past 12 months.

Kohlberg Kravis Roberts was established in 1976, and raised $800 million in 2005 in an initial public offering for KKR Financial Holdings.

KKR Financial is a leveraged investment vehicle that borrows in the commercial paper markets to invest in home loans, particularly so-called Alt-A loans seen as riskier than mainstream borrowers, but safer than subprime loans. Like other mortgage-backed securities, Alt-A loans have been hit hard by the credit squeeze and declines in U.S. housing prices.

General Electric

Japanese unit's sale nearly completed

General Electric said Wednesday it expects to wrap up the sale of its Japanese consumer-financing unit by the end of the third quarter.

GE said in a filing with the Securities and Exchange Commission that it recorded an after-tax loss of $908 million last year in the sale of GE Consumer Finance, known as Lake.

The loss represents the difference between the value of the business and its projected sale.

The industrial, finance and media conglomerate sold the business because Japanese regulatory limits on interest charges for unsecured personal loans "did not permit us to earn an acceptable return," GE said.

Citing continued pressure on the subprime-mortgage industry, GE also said Wednesday it had closed on the sale of its U.S. mortgage business in December for $117 million in cash. GE took an after-tax loss of $62 million on the sale for 2007.

Compiled from Seattle Times staff, McClatchy Newspapers, Bloomberg News and The Associated Press