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Wednesday, April 26, 2006 - Page updated at 12:00 AM

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Business Digest

787 order brings total for jet to 350

Pacific Northwest

Boeing

Boeing announced two new airplane orders Tuesday, including a 787 order that brings the total for the new jet to 350.

Air Pacific, the flag carrier of the South Pacific island of Fiji, ordered five 787-9s, with three additional purchase rights. The firm order is worth about $785 million at pre-discount list prices.

The airline plans to fly the planes on tourist routes connecting Fiji to Australia, New Zealand, North America and Japan.

Separately Tuesday, Singapore Aircraft Leasing Enterprise (SALE) ordered 10 737s to be delivered in 2009 and 2010 and has options to take 10 more. At list prices, the order is worth $675 million.

NeoRx

Shareholders OK financing deal

Seattle biotechnology company NeoRx said Tuesday its shareholders approved a planned $65 million financing.

The proposals needed to complete the deal were approved by more than 94 percent of shares voted, NeoRx said. The company expects to close the deal within a day.

NeoRx was down to $4.5 million in cash as of Dec. 31 after a net loss of $21.5 million for 2005, according to its latest financial statement.

The shareholder vote on the deal, first scheduled for April 11, was postponed until Tuesday due to a lack of quorum.

The financing will be led by investor MPM Capital. Investors will get new stock that nearly triples NeoRx's current float of 34.3 million shares.

Plaza Bank

Latino owners get federal go-ahead

The organizers of Plaza Bank, touted as the first Latino-owned bank in the Northwest, have received the go-ahead from federal regulators to begin raising capital for the venture.

The bank plans to raise $15 million to $20 million by selling stock to private investors. The stock will not trade publicly, at least not at first.

Spokeswoman Carrie Shaw said Plaza Bank's commercial office will open in mid-May in the City Centre building downtown; a branch office under construction at the Kent Station development should open by early June.

Carlos Guangorena, tapped to be the new bank's chief executive, has spent 29 years in the banking industry, most recently as a senior vice president at Wells Fargo in Seattle.

Costco Wholesale

Dividend raised by 13 percent

Costco Wholesale, the largest U.S. warehouse club, said it raised its quarterly dividend 13 percent.

Costco will pay 13 cents a share, up from 11.5 cents, on May 26 to shareholders of record May 10, the Issaquah company said in a statement Tuesday. The company last increased its dividend in May 2005, according to data compiled by Bloomberg News.

Ste. Michelle Wine Estates

First-quarter profit up 20 percent

Ste. Michelle Wine Estates in Woodinville posted a first-quarter operating profit of $8.5 million, up 20.2 percent, according to Greenwich, Conn.-based parent UST. Net sales were up 9.1 percent to $56.3 million. UST also markets smokeless tobacco, including such brands as Copenhagen and Skoal.

Microsoft

Social networking spinout announced

Mathematical models of real-world social interactions developed by Microsoft researchers will form the basis of a new company focused on improving online social networking.

Microsoft is licensing its technology to Wallop, a venture capital-funded San Francisco startup. It's the third technology spinout announced by Microsoft's year-old IP Ventures program.

Microsoft gets a minority equity stake in Wallop — founded by entrepreneur Karl Jacob and funded by Bay Partners — and a nonvoting seat on its board of directors.

Wallop, which Jacob said plans to launch a product later this year, will present a more nuanced, safer and easier-to-use social computing environment. He wouldn't say how Wallop will make money, but he ruled out an advertising-based model.

ZymoGenetics

New executive to sell lead product

ZymoGenetics has hired a top marketing executive to sell its lead product candidate, a treatment for bleeding during surgery.

Michael Dwyer will join the Seattle biotechnology company next month as senior vice president of marketing and sales.

He's responsible for building the ZymoGenetics sales and marketing teams in anticipation of a late-2007 launch of rhThrombin.

Dwyer worked most recently for Novo Nordisk, Zymo's former parent, at the head of an 850-person sales team focused on diabetes.

Nation and World

IBM

Dividend raised to jolt stock price

IBM increased its dividend by 50 percent Tuesday in an attempt to jolt the technology bellwether's listless stock price.

The move was announced at IBM's annual shareholders meeting, where about 250 investors heard Chairman and Chief Executive Sam Palmisano tout the company's prospects.

Palmisano also defended the company's recent decision to freeze its U.S. pension plan, arguing that "we had to do something" to reduce the liabilities and uncertainties surrounding employee benefits.

Before Tuesday, IBM's quarterly dividend of 20 cents per share amounted to about a 1 percent annual yield, based on IBM's recent stock price of roughly $80. The new dividend of 30 cents per share takes effect this quarter and is expected to continue through the rest of the year.

Shares of IBM, a Dow component, rose 56 cents to close at $82.67 on Tuesday.

Reynolds American

$3.5 billion to be paid for Conwood

Cigarette maker Reynolds American on Tuesday agreed to acquire privately held Conwood for $3.5 billion, expanding Reynolds' reach into the smokeless-tobacco market.

Conwood, which makes Kodiak snuff and Levi Garrett chewing tobacco, had 2005 sales of more than $450 million and operating income of $250 million, Reynolds said. The company is the largest or second-largest player in each of the five categories of smokeless tobacco.

Reynolds, whose cigarette brands include Camel, Salem and Kool, expects the deal to add to earnings in "both the short and long term," but the company stopped short of updating its full-year guidance.

Reynolds plans to combine Conwood with its Lane Limited unit, based in Memphis, Tenn. The deal is expected to close by the end of the quarter, pending regulatory approval.

Airbus

Complaints prompt possible changes

European plane maker Airbus plans to decide on possible changes to its future A350 midsize aircraft by mid-2006 following complaints from customers, Airbus head Gustav Humbert said.

"We are talking intensively with our customers and looking very closely at the matter," Humbert told reporters in Dresden, Germany. "We have an A350 that is good. If we can improve it, we will do that with profitability and the market in mind."

Humbert declined to comment on details of possible changes or any financial implications.

Compiled from Bloomberg News, Seattle Times business staff, The Associated Press and Reuters

Copyright © 2006 The Seattle Times Company

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