Japan banks up assistance to Daiei to &YEN460 billion

TOKYO >> Daiei Inc. will receive a total of &YEN460 billion in financial assistance from three major creditor banks, up &YEN40 billion from an initial plan, to promote its fresh three-year restructuring program, according to the final draft of the plan made available today.

The troubled supermarket chain operator, which has four stores on Oahu, also will reduce capital affecting common shares from the initial 50 percent to 99 percent, and increase the closures of unpro- fitable outlets from the previously projected 50 to around 60, the draft said.

Daiei hopes the move will help the company recover earnings in the near future. The initial draft, announced Jan. 18, faced harsh criticism from investors, who said the restructuring measures were not sufficient enough to solve the retailer's problems.

The draft was drawn up by Daiei and the three banks -- UFJ Bank, the key component of UFJ Holdings Inc., Sumitomo Mitsui Banking Corp. and Fuji Bank, a member of Mizuho Holdings Inc.

Tesoro issuing new shares to help finance acquisition

Tesoro Petroleum Corp., which operates Hawaii's largest refinery, will issue 20 million new shares of its common stock to partially finance a refinery acquisition, the company said yesterday.

The stock is expected to be offered the week of March 4 through Lehman Brothers Inc., Goldman Sachs & Co. and Friedman Billings and Ramsey. The company currently has about 41.4 million shares of common stock.

San Antonio-based Tesoro said it will use the capital to buy Golden Eagle refinery and 70 associated gas stations from Valero Energy Corp. for $1.125 billion. The deal is expected to close in April.

Tesoro shares closed down 36 cents yesterday at $13.36 on the New York Stock Exchange.

Biometric firms to merge as security heats up

NEW YORK >> Security technology firm Identix Inc. is buying rival Visionics Corp. for $269 million in stock to gain leverage in a hot industry as security has become a top priority since Sept. 11, the com- panies announced yesterday.

Shares of both companies have traded at a frenzied pace since hijackers crashed jumbo jets into the World Trade Center, the Pentagon and a Pennsylvania field, prompting Corporate America and the government to bolster security efforts. The combination of the two companies "results in a total security company," said Visionics Chief Executive Joseph Atick, who will serve as CEO of the combined entity.

Visionics, based in Jersey City, N.J., sells face recognition and fingerprint ID technology and services, primarily to the U.S. government, while Identix, based in Los Gatos, Calif., specializes in fingerprint recognition. The companies billed the deal as a merger of equals, but Identix, whose shareholders will control a narrow majority of the new company, essentially values Visionics' 28.8 million shares at $9.34 each, an 11 percent discount from yesterday's closing price of $10.50 on the Nasdaq.

Terms of the transaction call for Identix to exchange 1.3436 of its shares for each Visionics share. Shareholders of Identix will own 52.4 percent of the new company and Visionics shareholders will own the other 47.6 percent.

Identix Chairman and CEO Robert McCashin will serve as chairman of the new company.

Shares of Identix closed down 16 cents at $6.95 on the Nasdaq ahead of the announcement, and Visionics' shares ended up 20 cents at $10.50.

In other news

San Jose, Calif. >> EBay Inc., the largest Internet-auction site, said it canceled one auction after a user tried to sell votes on Hewlett-Packard Co.'s planned $20.9 billion purchase of rival computer maker Compaq Computer Corp. The bidding ended after 29 offers that topped out at $69. "EBay isn't the place to sell your vote," spokesman Kevin Pursglove said.