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Business

Business Briefs

Bayer cleared in U.S. court; Dresdner Bank chairman to quit, Easyjet's Deutsche BA bid fails, BASF profits up 25 Percent, LTU is to receive EU aid and more.

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Cleared of liability in a Texas court

Bayer cleared of drug liability in U.S.

German chemicals giant Bayer has been cleared of any liability in a €527 million ($560 million) American lawsuit over the withdrawn anti-cholesterol drug Lipobay. The plaintiffs had accused the company of ignoring reports linking the drug, sold under the Baycol brandname in the U.S., with health problems and deaths. But on Tuesday, a Texas jury rejected claims that Bayer should pay damages to 82-year-old Hollis Haltom, who claims he developed a potentially fatal muscle disorder after taking the drug. Bayer shares plunged last week after the company warned that the potential cost of Lipobay-related cases might exceed its insurance cover. Baycol and Lipobay were withdrawn from the market in 2001 after more than 100 deaths were linked to the drug.

Reports: Dresdner Bank chief to resign

Bernd Fahrholz, the chairman of Germany's troubled Dresdner Bank, will announce his resignation on Wednesday, bank sources told news agencies on Tuesday. Fahrholz is expected to be replaced by Herbert Walter of Deutsche Bank. Spokesmen for insurance giant Allianz, which acquired Dresdner in 2001, and Deutsche Bank would not comment on the reports. The bank has been a burden to Allianz since the takeover. The insurance company posted its worst-ever quarterly results in the third quarter of last year, when it posted a net loss of €2.5 billion ($2.66 billion). Allianz is to announce its figures for 2002 on Thursday. Analysts said they expected that the loss after taxes would amount to €1.4 billion. That would compare to a net profit of €1.623 billion in 2001. The bank is expected to have suffered a loss of €1 billion during the fourth quarter. During his tenure, Fahrholz implemented a rigid cost-cutting program. As a result, the bank will have cut 11,000 jobs by year's end.

Easyjet Withdraws Bid for Deutsche BA

Easyjet, Europe’s largest no-frills airline, said on Tuesday it would not proceed with a plan to buy loss-making Deutsche BA, British Airway's low-budget carrier in Germany. Easyjet, which last year took over British rival GO, cited rigid labor laws, a “substantial deterioration” in the German market and aggressive pricing competition from Lufthansa as reasons for backing out of the deal. The option to buy Deutsche BA was part of an exclusive deal that cost the firm 6.1 million pounds(€9 million). Easyjet viewed the purchase as a way of increasing its influence in the increasingly competitive German short-haul market. British Airways issued a statement saying the airline's operations would continue without Easyjet's involvement. BASF profits up 25 percent

BASF, the world’s largest chemicals manufacturer, announced full-year operating profits were up 25 percent in 2002, despite falling turnover. BASF said on Tuesday that sales had fallen slightly by 0.9 percent last year, to €32.2 billion ($34 billion). At the same time, profits rose to €2.9 billion. The markets reacted favorably to the news, with shares in the company rising sharply on German markets. LTU to get state aid

LTU is to receive the go-ahead from the European Union for long-term state aid, Commission sources said on Tuesday. As part of its modernization plan, the Dusseldorf-based charter airline has promised to cut the number of aircraft and routes it flies. The company has been subject to months-long checks by the EU to determine whether it qualifies for the €100 million ($106.2 million) loan, to be paid back in four instalments by 2008. Under the deal, LTU is expected to become the first German airline to be kept afloat by an EU loan. The European Commission is expected give the green light officially on Wednesday. MAN expects better 2003 results

Commercial vehicle-maker Man said it expected sales to rise by 5 percent this year, as it presented its yearly results in Munich on Tuesday. The firm made a pre-tax profit of €13 million ($13.81million) last year, rallying from €49 million in debt the year before. Sales in commercial vehicles had improved since last autumn, the firm said. “The worst times are hopefully behind us,” said Hakan Samuelsson, MAN's chairman of the board. Despite improved earnings, MAN said it would slash a further 1,000 jobs in Germany, moving production of expensive coaches and buses to Turkey and Poland, where costs are cheaper. The company has cut more than 4,000 jobs as a result of cost-cutting measures since February 2001.

Compiled with material from wire services.