SAN FRANCISCO (AP) — Gap Inc. Chief Executive Officer Paul Pressler resigned Monday following a miserable holiday shopping season that hurt the retail chain’s fourth quarter profit.
The announcement after the markets closed came amid speculation that the struggling retailer was close to a takeover after hiring investment firm Goldman Sachs to consider offers or other dramatic changes.
Under the terms of his contract, Pressler will receive a severance package totaling about $14 million in salary, bonuses and stock options, according to company officials.
Robert J. Fisher, chairman of Gap’s board of directors, will serve as interim CEO and company president as the board searches for a permanent replacement.
Citigroup Inc. boss reassigned
NEW YORK (AP) – Sallie L. Krawcheck, chief financial officer at Citigroup Inc. and one of the most powerful women on Wall Street, was reassigned Monday to head of the company’s brokerage and private banking business – a lower profile job with narrower responsibilities.
The change puts Krawcheck, whose role had included strategic planning, back in charge of the brokerage business she ran two years ago. It also puts her in charge of a division of Citigroup that accounted for only 8 percent of the company’s net income in the most recent quarter.
The move had been rumored for weeks as the nation’s largest bank struggles to revive its stock price, control its expenses and increase growth in its consumer division. Some investors have called for a breakup of the company or the wholesale replacement of its leadership.
LONDON (AP) – Shares in European online gambling companies fell Monday on news that U.S. prosecutors had launched a probe into Internet gambling.
The U.S. Department of Justice has sent subpoenas to about 15 investment banks across Europe and in the United States, requesting information as part of a probe into gambling companies including Britain’s PartyGaming PLC and payment networks such as Neteller PLC, banking officials said.
The banking officials, who spoke on condition that they not be identified by name because they were not authorized to do so, said that the subpoenas were received shortly after Christmas.
Dresdner Kleinwort, Deutsche Bank, HSBC, Credit Suisse, JP Morgan and Bank of America declined to comment on reports they were among the banks to receive subpoenas. Citigroup Inc. officials did not immediately return calls for comment.
DALLAS (AP) – Take-Two Interactive Software Inc., publisher of the popular “Grand Theft Auto” video games, said Monday its investigation uncovered stock option irregularities during the tenure of former Chairman and Chief Executive Officer Ryan Brant.
In a regulatory filing with the Securities and Exchange Commission, Take-Two said that from April 1997 through August 2003, Brant engaged in a “pattern and practice of backdating options, and during such period, a significant number of option grants appear to have been backdated.”
Stock options backdating involves companies pegging stock options to favorable grant dates in the past to boost the recipients’ award.
NEW YORK (AP) – American Express Corp., the fourth-biggest U.S. credit-card issuer, on Monday reported stronger holiday shopping and a reduction in bankruptcy write-offs helped lift fourth-quarter profit by 24 percent.
The New York-based financial and travel services company reported a profit of $922 million, or 75 cents per share, for the September-December period, compared with $745 million, or 59 cents per share, a year earlier. Revenue increased 13 percent to $7.21 billion from $6.38 billion.
The quarterly results cap a transformative year for AmEx, which in 2005 spun off its Ameriprise Financial Inc. unit to focus on growing its card and travel businesses. Chairman and Chief Executive Kenneth I. Chenault has focused this year on striking deals with banks to issue AmEx cards, and also capturing more business from high-spending consumers.