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The business week in Switzerland

SAirGroup, which owns Swissair, agreed to a cash injection to save Sabena from bankruptcy


This week brought a decision on a capital injection for the ailing Belgian carrier, Sabena which is part owned by Switzerland's SAirGroup, as well as a clutch of corporate results.

Sabena won a last minute reprieve after the SAirGroup and the airline's other shareholder, the Belgian government, finally agreed on a cash injection of SFr380 million ($225 million).

The plan goes hand in hand with cost cutting measures agreed with the unions that will lead to 700 job losses. But many analysts see the deal as little more than a temporary reprieve since SAirGroup has raised doubts about is long-term commitment to the airline.

Switzerland's largest banking group, UBS, announced record earnings for last year of over SFr7.5 billion. The figures exceeded forecasts by analysts who had feared that the bank's acquisition of New York investment broker, PaineWebber, would weigh on results.

In other corporate results, the food giant, Nestlé, saw net earnings for 2000 rise by 22 per cent to SFr5.76 billion on turnover of SFr82 million.

Earnings at the industrial concern, Georg Fischer, hit a new high reaching SFr151 million. Sales were up 21 per cent to just under SFr4.4 billion.

And Ciba Specialty Chemicals boosted its net profit in 2000 by 39 per cent to around SFr450 million.

The Swiss industrial holding group, Sulzer, became the target of a takeover bid on Monday, when a Swiss-based investment firm, InCentive Capital, offered SFr4.4 billion for the company.

Sulzer's board rejected the bid on Friday, saying the price was too low. The company reassured shareholders that internal changes were well underway and would create greater value for shareholders, employees and customers than what it described as the "short-term oriented procedure" of InCentive Capital.

Finally, the recently merged telephone operator, Sunrise/diAx, announced this week that it was to cut 500 jobs from its 2,500 strong workforce. Some 240 people will go at the end of the month, with the rest following by the end of the year.

by Michael Hollingdale


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