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Business Briefs

Reported by Star-Bulletin staff & wire

Tuesday, September 19, 2000

Grove Farm ends talks with suitor

Grove Farm Co., owner of 22,000 acres on Kauai including the Kukui Grove Shopping Center in Lihue, said it has broken off discussions with a business that sought to buy the company from its 160 shareholders.

Hugh W. Klebahn, Grove chairman and chief executive, did not name the interested party in his short statement yesterday, but the Star-Bulletin last month reported that Honu Group Inc., developer of the King Kalakaua Plaza retail complex in Waikiki, had signed a letter of intent to buy Grove Farm.

Grove Farm, whose holdings include a golf course and residential and commercial real estate, was founded in 1864 by George N. Wilcox and most of its shareholders are members of the Wilcox family.

Judge defers ruling on Waikiki store

A bankruptcy judge has postponed a decision over whether the local managers of Liberty House can close the company's Waikiki store and market its lease.

U.S. Bankruptcy Judge Lloyd King heard arguments yesterday from attorneys representing the management of Liberty House and its owner, Chicago-based JMB Realty Corp.

Ronald Marmer, attorney for JMB, said Liberty House managers had no authority to hire local real estate firm Colliers Monroe Friedlander to look for tenants for the 40,000-square-foot space in Waikiki. The court should postpone any move to sell the leases until the judge confirms a new board of directors for Liberty House, he said.

But attorney Bruce Bennett said management has the right to run its business until it gets fired. Liberty House managers have said the company can make more money from leasing the property than retailing on it themselves.

Judge King scheduled a follow-up hearing on Sept. 27, urging the attorneys to settle the dispute by themselves. Liberty House filed for Chapter 11 reorganization in March 1998.

Sun pays $2 billion for Cobalt Networks

PALO ALTO, Calif. - Sun Microsystems Inc., one of the biggest makers of computers that run Internet sites, agreed to buy Cobalt Networks Inc. for about $2 billion in stock, broadening its line of computer servers.

Sun will pay 0.5 share, or $57.63, for each share of Cobalt, which specializes in servers for Internet-related uses.

That's a 40 percent premium to Cobalt's closing price yesterday. Cobalt jumped $16.06, or 39 percent, to $57.19 in today's trading.

Palo Alto, Calif.-based Sun competes with Hewlett-Packard Co. and International Business Machines Corp. for server sales. Companies such as eBay Inc. buy Sun's equipment to run their Web sites and to process online sales.

Buying Cobalt provides Sun with more products that it can use to try to boost sales by offering more options to customers purchasing complex computer systems.

Antitrust attorney stepping down

WASHINGTON - Assistant Attorney General Joel I. Klein, who launched the antitrust case to break up computer software giant Microsoft Corp., is leaving the government at the end of the month.

"The time has come to seek new challenges," Klein said in a statement today that did not disclose what his next job would be. "I have done what I set out to do here, and our work is on the right track."

In other news . . .

DETROIT - Pro Air Inc., a low-fare carrier that flies out of Detroit City Airport, suspended flights at midnight last night after the Federal Aviation Administration revoked its operating certificate.

The FAA said Pro Air failed to correct aircraft-maintenance procedures and record-keeping problems cited in a June inspection. Pro Air is appealing the FAA action.