John Edwards Revisits His Past, Hanging Law Shingle Again

Before he served as a United States senator, before he made a run at the presidency and before his political career collapsed amid a sex scandal and fraud trial, John Edwards was a trial lawyer.

Now, Mr. Edwards is returning to his roots and opening a new law practice. The plaintiffs’ firm, Edwards Kirby, reunites him with his former partner, David F. Kirby, and includes on its payroll his eldest daughter, Cate Edwards.

“The reason we formed this firm is because we all believe in the same thing â€" in standing up for the disenfranchised and those who need an equal chance,” Mr. Edwards said in a telephone interview from his offices in Raleigh, N.C. “That’s why we exist.”

The path back for the 60-year-old Mr. Edwards began in earnest in May 2012, when a federal jury in Greensboro declared a mistrial on five corruption charges and acquitted him on one more. Prosecutors charged Mr. Edwards with misusing nearly $1 million in campaign donations to hide a pregnant mistress as he reached for the Democratic presidential nomination in 2008.

Mr. Edwards walked out of court with his law license intact and vindicated legally, but the blow to his family, reputation and ego was devastating.

For nearly six weeks, a jury â€" and by extension, a nation â€" heard about Mr. Edwards’s most intimate sexual secrets and the string of public lies he told regarding his affair with his campaign videographer and her subsequent pregnancy. The trial laid bare Mr. Edwards’s efforts to conceal his mistress from his wife, Elizabeth Edwards, an accomplished lawyer who was engaged in a public fight with breast cancer.

Since the trial, Mr. Edwards has done much to repair his family and personal life. He has remained based in his sprawling home in the countryside not far from Chapel Hill, tending to Emma Claire, 15, and Jack, 13, two of the four children he had with Mrs. Edwards.

His son, Wade, was killed in a car wreck when he was 16.

Mrs. Edwards had separated from Mr. Edwards in 2010, but never legally divorced him, and died in December of that year.

On Tuesday, Mr. Edwards was reluctant to discuss his personal life, and refused to address reports that he has been dating a 35-year-old single mother. He did acknowledge, however, that his legal practice would require finding additional child care for Emma Claire and Jack.

“I’m their sole parent and there is nothing more important than being the best father I can be,” he said. “I’m going to have to get some extra help for them.”

Mr. Edwards also discussed his relationship with his youngest daughter, Frances Quinn Hunter, now 5 years old and living in Charlotte with her mother, Rielle Hunter. “I see her regularly and I love her,” he said of his daughter, who goes by Quinn.

Over the last year, Mr. Edwards has continued his work fighting poverty. He traveled to El Salvador and Haiti to work with Michael Bonderer, who runs Homes from the Heart, an organization that builds houses for the poor in impoverished countries.

In a telephone interview from El Salvador Monday, Mr. Bonderer said that Mr. Edwards had always talked about a plan that centered on a law practice, his children and his efforts to close the gap between what he called in his campaigns the “two Americas.”

He said that Mr. Edwards always knew the road back would not be easy. “Poor Edwards has to deal with a cynicism no matter what,” he said. “He’s got to walk the gantlet no matter what. He’s just going to have to invest the time to go through all that.”

It has helped his public image to have the staunch support of his daughter Cate Edwards. Armed with a law degree from Harvard, Ms. Edwards was a major player in her father’s criminal trial, sitting behind him every day of the proceedings and offering legal strategy. In 2011, she married Trevor Upham, an oncologist, and eventually moved with him to Washington and opened a legal practice with Sharon Eubanks specializing in civil rights cases. That firm, Edwards & Eubanks, will become Edwards Kirby’s Washington office.

“It’s a dream to be able to work with my dad, who inspired me to become a lawyer in the first place,” said the 31-year-old Ms. Edwards.

Before entering politics, Mr. Edwards earned a fortune as a plaintiffs’ lawyer, casting himself as the champion of the little guy. He focused on catastrophic injury and wrongful death cases, obtaining multiple multimillion-dollar verdicts from doctors, hospitals and corporations.

His command of the courtroom and persuasiveness with juries often led adversaries to settle rather than face off against him at trial. Insurance companies held seminars about how to deal with Mr. Edwards.

In 1993, Mr. Edwards formed his own firm with Mr. Kirby, his classmate from the University of North Carolina School of Law. “John is happiest when he’s practicing law, working 20 hours a day with causes to fight for,” Mr. Kirby said.

Mr. Edwards sounded energized discussing his new firm, which will start with six lawyers. He said that the practice would focus on three areas: personal injury law, consumer rights cases and civil rights litigation. Already, Mr. Edwards said, he has entertained taking a variety of assignments, including a potential price-fixing case and a wrongful death matter involving an electrocution.

But he has not been in courtroom since the late 1990s, notwithstanding last year’s experience as a criminal defendant. Looking back on his trial, Mr. Edwards said that it reinforced his belief in the justice system.

“I trust juries,” Mr. Edwards said. “They closely listen to the evidence that’s presented to them. They listen to the law and, they collectively do what they believe is right. My years in courtrooms, both as a lawyer and in what I just went through, lead me to that same conclusion.”

He dismissed concerns that his humiliating downfall and public lies about his affair while his wife was battling cancer would impede his ability to attract clients.

“You build trust and earn respect the same way today as the first day I started practicing law,” he said. “By hard work, by caring about the people you represent, by presenting your case in the most thorough and professional manner possible and by arguing your heart out.”

Mr. Edwards coordinated the announcement of his firm with a public relations agency. When asked why he did not simply just start working, he said he wanted people to know that he was practicing law again.

He then offered the kind of pitch one might see on a billboard or hear on a commercial break from an afternoon soap opera.

“If you’ve been treated unfairly and you believe you have a legal case,” he said, “all of us at Edwards Kirby are available to help you.”

Hard to See a Sellout in Geithner’s Job Choice

Within 24 hours of Timothy F. Geithner’s announcement on Saturday that he would join Warburg Pincus, the private equity firm, a parade of naysayers emerged, almost like clockwork, to criticize the former Treasury secretary’s move as a prime example of the evil of the government’s revolving door.

“It’s hard to believe someone like Geithner, with no investment or private sector experience, would be worth the millions he will surely earn each year if he didn’t also turn heads at the highest levels of government,” Noam Scheiber of The New Republic wrote.

Dennis Kelleher, president of Better Markets, a Wall Street watchdog organization, sent an email statement: “Geithner’s spin through the revolving door to cash in on his ‘public service’ will enrich himself, further erode public confidence in government and give the finance industry more access and influence at the highest levels of government worldwide.”

While there’s nothing good about the “revolving door” between Washington and Wall Street, there’s something quite odd about the developing narrative about Mr. Geithner’s move, because it is hard to argue Mr. Geithner ever spun through the revolving door even once.

There’s no question that had Mr. Geithner become the president of a university â€" as some had speculated was a possibility a year ago when the top job at Dartmouth, his alma mater, was available â€" or of a nonprofit, like the Red Cross, the break from the government to the private sector would have undoubtedly been cleaner.

But the idea that he’s selling out to the world he regulated doesn’t quite fit either.

Maybe this is splitting hairs, but Warburg Pincus, a relatively obscure yet well-respected private equity firm has little to do with the big institutions Mr. Geithner once oversaw.

Had Mr. Geithner gone to a large bank like Goldman Sachs, there would rightly be a steady stream of negative headlines, as there would be had he gone to BlackRock, one of the largest buyers of United States Treasuries. (Laurence D. Fink, BlackRock’s founder and chief executive, is said to have discussed a possible position with Mr. Geithner.)

His critics seem to forget, or only casually acknowledge, that he hasn’t worked in the private sector for most of his adult life. He was an Army brat as a child and he has worked in government or at the Federal Reserve for 25 years; the last time he worked in the private sector was in the 1980s, for Henry Kissinger’s consulting firm.

Mr. Geithner had a chance to go to Wall Street before. Sanford I. Weill, the chairman of Citigroup at the time, approached Mr. Geithner about a job. He turned it down, in part because of the clear conflict it posed.

So it is tough for critics to say that Mr. Geithner has been a member of the Acela crowd â€" riding back and forth from big government jobs to private sector roles â€" despite the many myths that have developed over the years that he once worked at Goldman. One such myth was so strong that Amy Rule, the wife of Rahm Emanuel, the mayor of Chicago and former White House chief of staff, famously said to Mr. Geithner at a dinner party that he “must be looking forward to going back to that nice spot you have waiting for you at Goldman,” according to John Heilemann, a writer for New York magazine.

Mr. Geithner, up until now, has hardly been in the big-money leagues. He was paid $191,300 as the Treasury secretary after taking a pay cut from his role as the president of the Federal Reserve Bank of New York, which paid him $411,200. While that’s nothing to sneeze at, he clearly was in a position for many years to make multiples of what he earned in government.

Ben White of Politico on Monday joked sarcastically in his email newsletter about the criticism of Mr. Geithner’s new role: “Maybe he should have joined the priesthood.”

Mr. White quoted a friend of Mr. Geithner defending him and saying he would make a great investor: “For more than three years, Geithner oversaw the largest portfolio in the world with more than $400 billion invested in banks, A.I.G., the car companies and illiquid assets. If Geithner and his team had been paid like private sector managers,” this person added, “safe to say none of them would have to work again.”

That may be true, but it is a stretch to suggest that Mr. Geithner’s roles at Treasury or the Fed make him a good investor. When the government put together the bailout program in 2008, no one did so with any expectation â€" or insight â€" that the stakes would turn out to be profitable. That’s not to say Mr. Geithner isn’t a smart guy or won’t be valuable to Warburg.

Is he trading on his relationships and his role in government? Yes and no. In his role as a fund-raiser for the firm, he will, of course, lean on relationships he has built up over many years. His reputation should help him get meetings and close deals. But he won’t be lobbying his former colleagues in Washington on bank regulations.

One question that invariably will come up is his position on taxing carried interest, the share of private equity firms’ profits from deals. He has long been an advocate in the Obama administration of raising the current rate of 15 percent. (I have taken the same position in many columns.) If he changes course now that he is in industry, he deserves a drubbing. One of his mentors, Robert Rubin, has publicly called for a higher tax rate as well.

The big question is why Warburg, which has made its reputation by staying under the radar, would want to hire someone like Mr. Geithner, who will without a doubt raise the firm’s public profile in a way it has never been raised before. Invariably, every time Warburg makes an acquisition, the deal will take on more significance. Every time the name Warburg appears in the paper, it will be followed by a comma and the phrase, “the firm that Timothy Geithner recently joined as president.”

I suspect that the real reason Mr. Geithner’s move infuriated some people is that they were disappointed he didn’t do something they consider more high-minded. “For all the criticism directed his way, Geithner was the exceedingly rare example of the idea that you can be a talented, high-level regulator and public servant and exist entirely apart from Wall Street financial interests. That won’t be true any longer,” Josh Green of Bloomberg Businessweek lamented.

While his hands may not appear squeaky clean, it hardly seems fair to call them dirty.

Andrew Ross Sorkin is the editor at large of DealBook. Twitter: @andrewrsorkin

Regulators See Value in Bitcoin, and Investors Hasten to Agree

The virtual currency bitcoin took a big step toward the mainstream on Monday as federal authorities signaled their willingness to accept it as a legitimate payment alternative.

A number of federal officials told a Senate hearing that such financial networks offered real benefits for the financial system even as they acknowledged that new forms of digital money had provided avenues for money laundering and illegal activity.

“There are plenty of opportunities for digital currencies to operate within existing laws and regulations,” said Edward Lowery, a special agent with the Secret Service, which is tasked with protecting the integrity of the dollar.

Signs that the government would not stand in the way of bitcoin’s development, even as it has been cracking down on criminal networks that use the digital money, stoked a strong rally in the price of the crypto-currency.

By Monday evening, the value of a bitcoin unit soared past $700 on some exchanges. The total outstanding pool of bitcoin â€" which is created by a network of users who solve complex mathematical problems â€" is now worth more than $7 billion.

The Senate hearing Monday afternoon was the clearest indication yet of the government’s desire to grapple with the consequences of this growth, and the recognition that bitcoin and other similar networks could become more lasting and significant parts of the financial landscape.

“The decision to bring virtual currency within the scope of our regulatory framework should be viewed by those who respect and obey the basic rule of law as a positive development for this sector,” said Jennifer Shasky Calvery, the director of the Treasury Department’s Financial Crimes Enforcement Network. “It recognizes the innovation virtual currencies provide, and the benefits they might offer.”

Ms. Shasky Calvery and the other officials at the hearing did say that basic questions still had to be answered about virtual currencies, including whether they can actually be considered currencies or whether they are more properly categorized as commodities or securities. The distinction will determine which agencies regulate the networks and how they are treated under tax law.

Ms. Shasky Calvery said that the Internal Revenue Service was “actively working” on its own rules for bitcoin.

The hearing followed other less visible steps taken by regulators and lawmakers to bring digital money into the mainstream.

New York State’s top financial regulator, Benjamin M. Lawsky, said last week that he would hold a hearing to consider the creation of a BitLicense to provide more oversight for transactions. Earlier, the Federal Election Commission put out an advisory indicating that bitcoin could be legally accepted as political donations.

The general counsel of the Bitcoin Foundation, a nonprofit advocating the currency, said in his testimony on Monday that he was receiving a much more friendly response from both government and the financial industry.

“We have recently perceived a marked improvement in the tone and tenor taken by both state officials and bank executives,” the general counsel, Patrick Murck, said.

Bitcoin has experienced a remarkable ascent since it was created in 2009 by an anonymous programmer or collective known as Satoshi Nakamoto. The money, which is not tied to any national currency, has been popular with technophiles who are skeptical of the world’s central banks. Only a finite amount of bitcoin will ever be created â€" 21 million units. Users have bid up the price on Internet exchanges, betting that the currency will be more widely used in the future.

There are significant questions about the wisdom of the digital money as an investment, given that bitcoin has no intrinsic value and has proved to be vulnerable to hackers. Many money managers have recommended that unsophisticated investors stay away.

Recently, though, bitcoin has been catching fire around the world, with exchanges in China particularly active. A growing number of prominent American investors have also bought stakes, including Michael Novogratz, a principal at the private equity and hedge fund giant Fortress Investment Group, as well as the Winklevoss twins, Cameron and Tyler.

The increasingly widespread ownership of bitcoin has shifted attention away from the criminal enterprises that have used digital money, but it was a focus at the Senate hearing.

Last month, the online marketplace Silk Road, where bitcoin was the primary form of payment, was shut down and its founder arrested after authorities accused it of being used to buy and sell drugs, weapons and pornography. The chairman of the Senate committee, Thomas R. Carper, Democrat of Delaware, said that a few days after the arrest, a similar site sprang up.

It can be harder to track criminals who use bitcoin, law enforcement officials said at the hearing, because they operate across international borders and often do not use established financial institutions that report transactions.

But Mythili Raman, an assistant attorney general at the Justice Department, also said that because every bitcoin transaction was recorded on a public ledger, it was possible for investigators to trace the movement of money between accounts.

“It is not in fact anonymous. It is not immune from investigation,” Ms. Raman said.

All the officials at the hearing said that crime had been an issue during the early days of credit cards and online payment systems like PayPal, and should not be a reason to limit innovation.

“It is our duty as law enforcement to stay vigilant while recognizing that there are many legitimate users of those services,” Ms. Raman said.

The bitcoin supporters who testified at the hearing said bitcoin could bring major changes to the financial system by cutting out the middle men needed to move money around the world.

“I am here to testify because I believe that global digital currency represents one of the most important technical and economic innovations of our time,” said Jeremy Allaire, the chief executive of Circle Internet Financial, which is seeking to promote more widespread use of the currency.

Given bitcoin’s appeal to skeptics of government, many aficionados have been wary of involvement by Washington. But advocates at the hearing said that the increasing cooperation with regulators could lay the groundwork for further growth.

“As this technology moves from early adopters into mainstream acceptance, it is critical in my view that federal and state governments establish policies surrounding digital currency,” Mr. Allaire said.

New Market Benchmarks Show a Lack of Options

Stocks rallied past two psychological barriers Monday morning, pushing the Dow Jones industrial average over 16,000 and the Standard & Poor’s 500-stock index beyond 1,800 for the first time, as investors still saw opportunities in the market.

Those round numbers were not important in themselves. Adjusted for inflation, the market remains below the peak it reached earlier in the decade. And by the end of the day, the market averages had retreated somewhat, with the Dow closing up slightly and the S.&P. reversing course and ending down.

But those easily remembered strings of zeros represented new benchmarks for a stock market that has already soared more than 160 percent since it hit bottom in March 2009. And they might entice investors who have been late to the party to enter it now, even if prices are no longer as cheap as they were a few years ago.

“A number like Dow 16,000 doesn’t mean anything in isolation,” said Jeffrey Kleintop, chief market strategist at LPL Financial in Boston. “But it helps to create a behavioral bias that gets more individual investors to come back into the market. It’s kind of a flag, telling people, ‘Don’t miss this,’ and more people who have been sitting on the sidelines will be likely to buy stocks.”

As people open their 401(k) and mutual fund statements these days, the numbers have generally been looking much better. That’s not just because recent returns have been strong but also because with the passage of time, the horrendous declines of early 2008 have dropped out of the calculations of five-year stock returns. Perhaps partly because of this, there is some evidence of a modest surge into stock mutual funds recently.

While individual investors have often been skittish about the stock market, a consensus of professional strategists became convinced months ago that compared with bonds, stocks were a good bet. That view is still widely held, with some caveats.

“ ‘Don’t fight the Fed’ is one of the oldest adages on Wall Street,” noted David A. Rosenberg, chief economist and strategist of Gluskin Sheff in Toronto. He says the swelling Federal Reserve balance sheet and the return of the stock market are highly correlated, with Fed officials deliberately pushing investors into buying stocks.

Mr. Rosenberg, often thought of as a “permabear” because of his long-term gloomy outlook, is now cautiously bullish on many stocks and negative about the prospects for the bond market. “The long rally in bonds is over,” he said in a recent commentary.

On Monday, the yield on the Treasury’s 10-year note fell to 2.67 percent from 2.70 percent late Friday, while its price increased 11/32, to 100 24/32.

One problem, however, is that a range of valuation models show that stocks are relatively attractive â€" with “relative” being the key word â€" as long as interest rates remain very low. Corporate profits are rising, but not rapidly enough on their own to justify big increases in stock prices.

The direction of the bond market is therefore critically important to stock investors, who were reassured by testimony last week from Janet L. Yellen, suggesting that if she is confirmed as the next Fed chairwoman, the central bank will continue to be accommodative as long as the economy remains weak.

A sharp strengthening of the economy, and a tapering of the Fed’s $85 billion in monthly bond purchases â€" a policy known as quantitative easing â€" does not seem likely in the next few months, many strategists said.

But some analysts are bullish without deep conviction. Matt Paschke, for example, co-manages both bullish and bearish portfolios for Leuthold Weeden Capital Management in Minneapolis, including the Grizzly Short fund and the Leuthold Core fund. Over all, he said, despite stretched valuations in the stock market his firm remains “cautiously bullish,” largely because the fixed-income market looks so unattractive.

“There are two schools of thought on stock valuation,” he said. “One says you should only buy stocks when they’re cheap. The other says I need to put my money somewhere, so where should I put it? If you look at it that way, stocks are the only game in town, and that thought will probably make us and some other market participants stick around a little longer than we might like because there’s nowhere else to go.”

On a valuation basis, he said, the stock market isn’t particularly appealing. While it’s not in extreme bubble territory, he said, the S.&P. 500 is fairly richly priced right now. Going back to 1940, he said, industrial stocks in the index are trading 11.8 times price to cash flow, which puts them in the 83rd percentile, on a historical basis.

“You’d like to see them in the middle third or lower, but they’re in the top third, as far as valuation goes.”

They are also very expensive â€" well into the 90th percentile on a historic basis â€" according to several other metrics, including price-to-sales and price-to-book ratios, he said. If stock market participants believed that the Fed was about to alter its policy â€" and bond yields were going to rise sharply in the near future â€" then there might well be a flight from the stock market, he said. “We’re re-evaluating our position week to week,” he said.

On Monday, the Dow closed up 14.32 points, or 0.09 percent, to 15,976.02, while the S.&P. 500 fell 6.65 points, or 0.37 percent, to 1,791.53. The Nasdaq composite index also fell, by 36.90 points, or 0.93 percent, to 3,949.07.

Tim Hayes, chief global investment strategist for Ned Davis Research in Venice, Fla., said that he expected global stock markets to remain in an upward trend for the next few months. But then, he said, “with valuations getting stretched and monetary conditions becoming less favorable, there are, unfortunately, high probabilities that there will be a serious correction next year.”

Longer term, however, Mr. Hayes said, once that battering is over, the bull market is likely to resume.

Mr. Kleintop said that for the market to keep climbing, it’s important that “the economy start growing a little faster,” adding, “I think it can do that.”

Still, he said, it’s quite possible that investors who jump into the market now might experience an immediate 10 to 15 percent decline, one that is probably overdue in a bull market of this duration.

“It would be unfortunate,” he said, “if people who have stayed out of the market see the momentum, come in and get hurt. You’d hate to see that happen, but people should know that it could.”

Dropbox, an Online Storage Start-Up, Seeks $8 Billion Valuation

Online storage, once a backwater of the Silicon Valley technology scene, is suddenly a hot commodity.

Dropbox, a five-year-old San Francisco start-up that allows users to access stored documents via the web, is seeking $250 million in funding in a round that would value it at more than $8 billion, according to people with knowledge of the matter.

If successful, such a fund-raising round would more than double the company’s valuation. It last took on money in October 2011, when it raised $250 million at a valuation of about $4 billion.

Though it was not immediately clear who was prepared to invest in Dropbox at this lofty valuation, venture capital firms are sitting on billions of dollars, looking to pour late stage capital in well-established companies that are likely to go public or be sold. News of Dropbox’s efforts to raise the round was first reported by Bloomberg Businessweek.

Dropbox is just the latest young technology company to seek a sky high valuation. Last week, it was revealed that Snapchat, a photo sharing application with no revenues, turned down a $3 billion offer from Facebook. Twitter is valued at more than $22 billion after a week and a half of trading. Box, another online storage company that competes with Dropbox, is valued at more than $1 billion and is looking to conduct its initial public offering next year. And Pinterest, a bookmarking service, recently raised $225 million at a valuation of $3.8 billion.

Dropbox is growing quickly and now has more than 400 employees. As it grows, it is looking to shift from a focus on consumers to an emphasis on enterprise services. Active users have doubled to 200 million this year, and more than 4 million businesses now use its services, up from 2 million a year ago.

Though Dropbox could go public now, given strong investor appetite for shares of new technology companies, people familiar with the company’s thinking said this was an “opportunistic” round that would allow it to stay private for at least several months more, while increasing its valuation ahead of a likely I.P.O. next year. Funds from the round will be used to continue to hire new staff, and market its services as it shifts its focus to the enterprise.

Drew Houston, the 30-year-old chief executive of Dropbox, said that the market for online storage was growing quickly. “It’s a huge market,” said Mr. Houston, speaking at a conference in San Francisco organized by Salesforce on Monday. “The experience of Dropbox will be hugely different a year from now ”

And while critics claim online storage companies do not have defensible business models, given the low barrier to entry, Dropbox believes that it can succeed by becoming a one-stop shop for users’ online storage needs, and that with time, its business does become “sticky,” because it becomes a hassle to move documents to a new platform.

“We think about what are the problems out there that people don’t know they have,” Mr. Houston said.

For a young company, Dropbox has already been acquisitive, buying a number of smaller companies in recent years. An infusion of capital would give it the ability to continue its shopping spree.

“I’m sure we’ll do a lot more,” Mr. Houston said on Monday.

Justice Department Poised to Announce Mortgage Deal With JPMorgan

The Justice Department is set to announce a $13 billion settlement with JPMorgan Chase over the bank’s questionable mortgage practices in the run-up to the financial crisis, people briefed on the deal said, as prosecutors and the bank hashed out the final details of the deal in recent days.

The announcement, expected as soon as Tuesday, will detail how the government will divvy up the record $13 billion payout, with $4 billion directed to struggling homeowners. Under the settlement, the people briefed on the deal said, JPMorgan will have to hire an independent monitor to oversee the distribution of the $4 billion in relief, a black mark for a bank once considered one of Wall Street’s most trusted institutions.

The settlement, which comes after months of negotiating, will resolve an array of state and federal investigations into the bank’s sale of troubled mortgage securities to investors. Such securities, sold by banks across Wall Street, were at the center of the 2008 financial crisis.

When the securities soured, generating billions of dollars in losses for pension funds and other investors, federal and state authorities opened wide-ranging investigations into whether the banks properly warned investors of the risks.

JPMorgan, the nation’s largest bank, has become a symbol of that crackdown. And the size of the settlement reflects that magnitude. The $13 billion deal dwarfs all other settlements the Justice Department exacted from a single company.

The $4 billion in consumer relief, directed at hard hit areas like Detroit, is a crucial element of the deal. Nearly half of the sum, one person briefed on the deal said, will go to reducing the balance of mortgages in foreclosure racked areas. JPMorgan will also be credited $500 million for briefly halting collection of mortgage payments.

For the remaining $2 billion in relief, the person said, JPMorgan has agreed to reduce interest rates on existing loans, offer new loans to low-income homebuyers and keep those loans on its books. The bank will also receive credit for demolishing abandoned homes and other efforts addressed at curbing urban blight.

In addition to the $4 billion in consumer relief, JPMorgan will pay about $2 billion as a fine to prosecutors in Sacramento. The prosecutors, which were planning to sue the bank until settlement talks heated up in September, suspected JPMorgan failed to fully disclose the risks of buying such investments.

The government earmarked the final $7 billion as compensation for investors. The largest recipient is the Federal Housing Finance, which announced a $4 billion deal with JPMorgan last month. The agency oversees Fannie Mae and Freddie Mac, the housing finance giants that purchased billions of dollars in mortgage securities that later imploded.

The remaining portion of the compensation will benefit a credit union association, along with the offices of the New York and California attorneys general. The state authorities will probably pass on the compensation to investors in their states.

Justice Department Poised to Announce Mortgage Deal With JPMorgan

The Justice Department is set to announce a $13 billion settlement with JPMorgan Chase over the bank’s questionable mortgage practices in the run-up to the financial crisis, people briefed on the deal said, as prosecutors and the bank hashed out the final details of the deal in recent days.

The announcement, expected as soon as Tuesday, will detail how the government will divvy up the record $13 billion payout, with $4 billion directed to struggling homeowners. Under the settlement, the people briefed on the deal said, JPMorgan will have to hire an independent monitor to oversee the distribution of the $4 billion in relief, a black mark for a bank once considered one of Wall Street’s most trusted institutions.

The settlement, which comes after months of negotiating, will resolve an array of state and federal investigations into the bank’s sale of troubled mortgage securities to investors. Such securities, sold by banks across Wall Street, were at the center of the 2008 financial crisis.

When the securities soured, generating billions of dollars in losses for pension funds and other investors, federal and state authorities opened wide-ranging investigations into whether the banks properly warned investors of the risks.

JPMorgan, the nation’s largest bank, has become a symbol of that crackdown. And the size of the settlement reflects that magnitude. The $13 billion deal dwarfs all other settlements the Justice Department exacted from a single company.

The $4 billion in consumer relief, directed at hard hit areas like Detroit, is a crucial element of the deal. Nearly half of the sum, one person briefed on the deal said, will go to reducing the balance of mortgages in foreclosure racked areas. JPMorgan will also be credited $500 million for briefly halting collection of mortgage payments.

For the remaining $2 billion in relief, the person said, JPMorgan has agreed to reduce interest rates on existing loans, offer new loans to low-income homebuyers and keep those loans on its books. The bank will also receive credit for demolishing abandoned homes and other efforts addressed at curbing urban blight.

In addition to the $4 billion in consumer relief, JPMorgan will pay about $2 billion as a fine to prosecutors in Sacramento. The prosecutors, which were planning to sue the bank until settlement talks heated up in September, suspected JPMorgan failed to fully disclose the risks of buying such investments.

The government earmarked the final $7 billion as compensation for investors. The largest recipient is the Federal Housing Finance, which announced a $4 billion deal with JPMorgan last month. The agency oversees Fannie Mae and Freddie Mac, the housing finance giants that purchased billions of dollars in mortgage securities that later imploded.

The remaining portion of the compensation will benefit a credit union association, along with the offices of the New York and California attorneys general. The state authorities will probably pass on the compensation to investors in their states.

Maria Bartiromo to Leave CNBC for Fox Business

Maria Bartiromo, one of the first women to become a star on television reporting on business news, is leaving her longtime home at CNBC for its rival, the Fox Business Network.

CNBC confirmed the news Monday, thanking Ms. Bartiromo for her 20-year career at CNBC.

The network issued a statement: “After 20 years of groundbreaking work at CNBC, Maria Bartiromo will be leaving the company as her contract expires on November 24th. Her contributions to CNBC are too numerous to list but we thank her for all of her hard work over the years and wish her the best.”

Word of the deal with Fox Business was first posted on the Drudge Report.

Ms. Bartiromo is expected to start on the Fox Business Network next Monday, with a program dealing with the day’s developments on Wall Street. Her new deal is also expected to include exposure on the far more watched Fox News Channel. (Neither Fox outlet commented publicly about the hiring on Monday).

The signing is a coup of sorts for Fox Business, which has struggled to establish a profile. Ratings for the network continue to be challenged. Last week, Fox Business averaged fewer than 10,000 viewers in the group that attracts advertisers, those between the ages of 25 and 54. CNBC had more than three times as many with 31,000.

Ms. Bartiromo, who was the first correspondent to report directly every day from the floor of the New York Stock Exchange, was among the best-known faces on CNBC. She was once known as the “Money Honey” for her popular appeal. She also has a long history with Roger Ailes, the Fox News chairman, who also leads Fox Business. He was in charge of CNBC in 1993 when Ms. Bartiromo joined that network.

Compensation Fund Set for ‘Feeder Fund’ Victims in Madoff Scheme

The largest category of victims in the vast Ponzi scheme run by Bernard L. Madoff - those who lost cash through accounts with various middleman funds - will be first in line for compensation from a $2.35 billion fund collected by the Justice Department.

These “indirect investors” represent about 70 percent of all the claims filed after Mr. Madoff’s arrest in December 2008, and about 85 percent of the claims for out-of-pocket cash losses. But because they were not formal customers of Mr. Madoff’s brokerage firm, they are not eligible to recover anything from the $9 billion fund being paid out through the federal bankruptcy court.

However, the indirect investors â€" at least 10,000 people and possibly many times that â€" are eligible for compensation from the federal Madoff Victim Fund under criteria announced on Monday by Preet Bharara, the United States attorney in Manhattan.

Generally, anyone who withdrew less from their Madoff-related account than they paid in will be eligible to recover from the Madoff Victim Fund, even if they invested indirectly through the hundreds of “feeder funds,” investment groups and other pooled investment vehicles that poured cash into Mr. Madoff’s hands during his decades-long fraud.

“The process we have put in place opens the door for thousands of defrauded victims who otherwise might never have recovered anything,” Mr. Bharara said.

Mr. Madoff, once a respected figure on Wall Street, pleaded guilty in March 2009 to running a fraud whose cash losses exceed $17 billion and whose paper losses total almost $65 billion. He is serving a 150-year sentence in a federal prison in North Carolina. Peter Madoff, his brother and longtime business associate, pleaded guilty in June to federal tax and securities fraud charges, but denied he knew about his brother’s fraud; he is serving a 10-year prison term.

Including the Madoff brothers, 15 people have been charged in the historic fraud and nine have pleaded guilty. Five others denied the allegations and are currently on trial in federal court in Manhattan. Paul Konigsberg, the final defendant and a longtime Madoff investor and friend, was indicted in September; he had denied any wrongdoing.

A small part of the money in the Madoff Victim Fund came from the headline-making auctions of assets collected from Mr. Madoff and his family: three luxury homes, several expensive boats, a 10.5-carat diamond ring and other jewelry, along with personal memorabilia like a personalized New York Mets jacket and monogramed velvet slippers.

But most of it came from the estate of Jeffry Picower, a secretive investor who took more than $7.2 billion from his Madoff accounts during the life of the fraud. Mr. Picower died of a heart attack at his Palm Beach estate in October 2009. His widow settled litigation against him by paying $2.2 billion to the Justice Department and $5 billion to the fund being distributed through the bankruptcy process by the Madoff trustee, Irving Picard.

The Madoff Victim Fund is under the direct supervision of Richard Breeden, a former Securities and Exchange Commission chairman. Mr. Breeden said this process was designed to correct what seemed like the most “glaring” inequity in the Madoff compensation process.

“Feeder funds are a staple of Ponzi schemes,” he said, adding that “fully 85 percent of the people who lost cash in the Madoff scheme came in through those funds.” But the law governing Wall Street bankruptcies limits payments to Mr. Madoff’s direct customers â€" only about 15 percent of the victims who lost cash in the epic Ponzi scheme.

“There are literally widows and orphans who lost everything with Madoff but who will not get one thin dime from the bankruptcy process,” Mr. Breeden said. “Fortunately, this fund can define ‘victim’ more broadly than ‘customer,’ and it has.”

Details of how the new claims process will work have been posted on the fund’s website, www.madoffvictimfund.com, Mr. Breeden said, and claims must be received by the fund no later than Feb. 28, 2014, he added.

One category of Madoff investor â€" those who took more cash out of their Madoff accounts than they had paid in â€" remains ineligible for both the bankruptcy process and the new fund. While these investors saw billions of dollars in paper wealth vanish when Mr. Madoff was arrested, they had recovered all the cash they gave Mr. Madoff before the fraud collapsed.

“This should not have happened and it is a tragedy that it did,” Mr. Breeden said. “But the law doesn’t cover a loss of expectations, however devastating. It covers a loss of cash.”

Sony Entertainment Is Said to Hire Bain & Company for Cost-Cutting

LOS ANGELES â€" Sony Entertainment, under pressure to make its moviemaking operation more profitable, has hired Bain & Company to help it identify $100 million or more in additional overhead cuts, a move that would almost assuredly result in layoffs, according to people with knowledge of the matter.

Michael Lynton, chief executive of Sony Entertainment.

These people, who spoke on the condition of anonymity because of the sensitivity concerning cost-cutting, said that Michael Lynton, chief executive of Sony Entertainment, planned to mention Bain’s involvement in the studio’s affairs at an investor meeting on Thursday at the company’s Culver City, Calif., film lot.

Charles Sipkins, a Sony spokesman, declined to comment aside from a statement: “As part of a nearly four-year process of increasing financial discipline, Sony Pictures is conducting a review of its business to identify further efficiencies. Our object is, and always has been, to operate an efficient studio that is uniquely positioned to capitalize on further growth opportunities.”

Mr. Lynton has worked to speed up cost-cutting efforts since the company came under strong criticism in the spring from the activist investor Daniel Loeb, who owns about 7 percent of Sony through his Third Point hedge fund. Sony has reduced spending on movie advertising, for instance, and in September fired its film marketing president.

After a dismal summer with disappointing returns for films like “White House Down” and “The Smurfs 2,” Sony’s box office fortunes have perked up lately with hits like “Captain Phillips” and “Cloudy With a Chance of Meatballs 2.”

Sony Entertainment Is Said to Hire Bain & Company for Cost-Cutting

LOS ANGELES â€" Sony Entertainment, under pressure to make its moviemaking operation more profitable, has hired Bain & Company to help it identify $100 million or more in additional overhead cuts, a move that would almost assuredly result in layoffs, according to people with knowledge of the matter.

Michael Lynton, chief executive of Sony Entertainment.

These people, who spoke on the condition of anonymity because of the sensitivity concerning cost-cutting, said that Michael Lynton, chief executive of Sony Entertainment, planned to mention Bain’s involvement in the studio’s affairs at an investor meeting on Thursday at the company’s Culver City, Calif., film lot.

Charles Sipkins, a Sony spokesman, declined to comment aside from a statement: “As part of a nearly four-year process of increasing financial discipline, Sony Pictures is conducting a review of its business to identify further efficiencies. Our object is, and always has been, to operate an efficient studio that is uniquely positioned to capitalize on further growth opportunities.”

Mr. Lynton has worked to speed up cost-cutting efforts since the company came under strong criticism in the spring from the activist investor Daniel Loeb, who owns about 7 percent of Sony through his Third Point hedge fund. Sony has reduced spending on movie advertising, for instance, and in September fired its film marketing president.

After a dismal summer with disappointing returns for films like “White House Down” and “The Smurfs 2,” Sony’s box office fortunes have perked up lately with hits like “Captain Phillips” and “Cloudy With a Chance of Meatballs 2.”

Obama’s First-Term Finance Team: Where Are They Now?

Timothy F. Geithner’s move to the private equity firm Warburg Pincus is a big shift by a financial official from the Obama administration’s first term to the private sector.

But it’s an ever-lengthening list, as several appointed officials had already made the jump to private life well before the 75th Treasury secretary announced his new job.

Here’s a sampling of who has made a move so far â€" some to the financial sector, some to other government positions, and others to nothing yet:

• Mary Schapiro: The head of the Securities and Exchange Commission for the administration’s first term, tasked with rebuilding the agency after it was criticized for missing warning signs of the financial crisis and Bernard L. Madoff. She is now a top executive at the Promontory FinancialGroup, the powerful bank consultancy.
• Peter R. Orszag: The former head of the White House’s Office of Management and Budget and one of the Obama administration’s top “propeller heads.” He left government office three years ago, eventually joining Citigroup as a vice chairman of corporate and investment banking.
• Gary Gensler: The head of the Commodity Futures Trading Commission, and an unexpectedly strong proponent for tougher bank regulations. He remains in the role, but is expected to leave around the end of the year.
• Timothy Massad: A former corporate lawyer who became the assistant Treasury secretary overseeing the unwinding of the Troubled Asset Relief Program. He has been nominated to succeed Mr. Gensler, though it’s unclear whether he will pass muster in a deeply divided Senate.
• Robert Khuzami: The S.E.C.’s enforcement chief during President Obama’s first term, who brought big lawsuits against the likes of Goldman Sachs, which yielded an enormous $550 million settlement. He left the agency in January, and this summer announced plans to join the big law firm Kirkland & Ellis.
• Neal Wolin: Until this August, the deputy Treasury secretary and a top adviser to Mr. Geithner and then Jacob J. Lew. He was a veteran government official who served during the Clinton administration, with stints in private practice before and afterward. Mr. Wolin hasn’t announced a new post yet.
• Lael Brainard: Treasury’s under secretary for international affairs and the Obama administration’s top financial diplomat. She left the department earlier this month amid speculation that she may be nominated to serve on the Federal Reserve’s board of governors.
• Jeffrey Goldstein: A former Treasury undersecretary for domestic finance, responsible for matters like implementing the Dodd-Frank Act’s overhaul of Wall Street regulation. He left the department in 2011 to return to his employer, the private equity firm Hellman & Friedman.
• Steven Rattner: The former media banker and private equity executive served as the point person for the Obama administration’s automotive task force, overseeing the 2009 bailouts of General Motors and Chrysler. He left after serving five months in the position, covering the bulk of the restructuring work, and now manages the fortune of Mayor Michael R. Bloomberg.
• Ron Bloom: A former restructuring banker who served as Mr. Rattner’s deputy on the auto task force. He left the Treasury department in August of 2011 and became a senior fellow for the Center for American Progress. The next year, he rejoined a former employer, the investment bank Lazard Ltd.
• Harry J. Wilson: A onetime hedge fund executive who joined the auto task force and aided in the planning for G.M., Chrysler and Delphi, the car parts maker. He left government service after the auto turnarounds and unsuccessfully ran for New York State comptroller. He subsequently founded the Maeva Group, which specializes in restructuring advice, and served as a director of Yahoo Inc.
• James Millstein: A former corporate lawyer and then Lazard banker who became Treasury’s restructuring chief, overseeing the reorganization of the American International Group and its effective return to the private markets through a massive stock offering. He left government service in February 2011 and now heads Millstein & Company, a financial adviser specializing in restructuring whose clients include US Airways and a group of bondholders of Energy Future Holdings.
• David N. Miller: Treasury’s chief investment officer for TARP and the department’s top negotiator on bank bailout programs. He stepped down in March of 2011 and subsequently joined Silver Bay Realty Trust, an investment firm that acquires, renovates and leases out houses.
• Thomas Casarella: Mr. Millstein’s protégé, who replaced his onetime boss as acting Treasury restructuring chief and an overseer of the A.I.G. and Ally Financial turnarounds. He departed Washington in July 2011 and now works at Oaktree Capital, the big investment firm.

Obama’s First-Term Finance Team: Where Are They Now?

Timothy F. Geithner’s move to the private equity firm Warburg Pincus is a big shift by a financial official from the Obama administration’s first term to the private sector.

But it’s an ever-lengthening list, as several appointed officials had already made the jump to private life well before the 75th Treasury secretary announced his new job.

Here’s a sampling of who has made a move so far â€" some to the financial sector, some to other government positions, and others to nothing yet:

• Mary Schapiro: The head of the Securities and Exchange Commission for the administration’s first term, tasked with rebuilding the agency after it was criticized for missing warning signs of the financial crisis and Bernard L. Madoff. She is now a top executive at the Promontory FinancialGroup, the powerful bank consultancy.
• Peter R. Orszag: The former head of the White House’s Office of Management and Budget and one of the Obama administration’s top “propeller heads.” He left government office three years ago, eventually joining Citigroup as a vice chairman of corporate and investment banking.
• Gary Gensler: The head of the Commodity Futures Trading Commission, and an unexpectedly strong proponent for tougher bank regulations. He remains in the role, but is expected to leave around the end of the year.
• Timothy Massad: A former corporate lawyer who became the assistant Treasury secretary overseeing the unwinding of the Troubled Asset Relief Program. He has been nominated to succeed Mr. Gensler, though it’s unclear whether he will pass muster in a deeply divided Senate.
• Robert Khuzami: The S.E.C.’s enforcement chief during President Obama’s first term, who brought big lawsuits against the likes of Goldman Sachs, which yielded an enormous $550 million settlement. He left the agency in January, and this summer announced plans to join the big law firm Kirkland & Ellis.
• Neal Wolin: Until this August, the deputy Treasury secretary and a top adviser to Mr. Geithner and then Jacob J. Lew. He was a veteran government official who served during the Clinton administration, with stints in private practice before and afterward. Mr. Wolin hasn’t announced a new post yet.
• Lael Brainard: Treasury’s under secretary for international affairs and the Obama administration’s top financial diplomat. She left the department earlier this month amid speculation that she may be nominated to serve on the Federal Reserve’s board of governors.
• Jeffrey Goldstein: A former Treasury undersecretary for domestic finance, responsible for matters like implementing the Dodd-Frank Act’s overhaul of Wall Street regulation. He left the department in 2011 to return to his employer, the private equity firm Hellman & Friedman.
• Steven Rattner: The former media banker and private equity executive served as the point person for the Obama administration’s automotive task force, overseeing the 2009 bailouts of General Motors and Chrysler. He left after serving five months in the position, covering the bulk of the restructuring work, and now manages the fortune of Mayor Michael R. Bloomberg.
• Ron Bloom: A former restructuring banker who served as Mr. Rattner’s deputy on the auto task force. He left the Treasury department in August of 2011 and became a senior fellow for the Center for American Progress. The next year, he rejoined a former employer, the investment bank Lazard Ltd.
• Harry J. Wilson: A onetime hedge fund executive who joined the auto task force and aided in the planning for G.M., Chrysler and Delphi, the car parts maker. He left government service after the auto turnarounds and unsuccessfully ran for New York State comptroller. He subsequently founded the Maeva Group, which specializes in restructuring advice, and served as a director of Yahoo Inc.
• James Millstein: A former corporate lawyer and then Lazard banker who became Treasury’s restructuring chief, overseeing the reorganization of the American International Group and its effective return to the private markets through a massive stock offering. He left government service in February 2011 and now heads Millstein & Company, a financial adviser specializing in restructuring whose clients include US Airways and a group of bondholders of Energy Future Holdings.
• David N. Miller: Treasury’s chief investment officer for TARP and the department’s top negotiator on bank bailout programs. He stepped down in March of 2011 and subsequently joined Silver Bay Realty Trust, an investment firm that acquires, renovates and leases out houses.
• Thomas Casarella: Mr. Millstein’s protégé, who replaced his onetime boss as acting Treasury restructuring chief and an overseer of the A.I.G. and Ally Financial turnarounds. He departed Washington in July 2011 and now works at Oaktree Capital, the big investment firm.

Top Restructuring Lawyer Joins Morrison & Foerster

Morrison & Foerster said on Monday that Howard Morris, a former co-chief executive of SNR Denton, was joining the law firm as head of the bankruptcy and restructuring group in London.

His practice will focus on cross-border and pan-European transactions and insolvency proceedings.

“The addition of Howard comes at a crucial time with significant levels of corporate debt still to be restructured across the U.K. and more widely in Europe,” Gary Lee, chairman of Morrison & Foerster’s business restructuring and insolvency group, said in a statement.

Mr. Morris became a co-chief executive of SNR Denton in 2010, when the law firm was created by the merger of Sonnenschein Nath & Rosenthal of the United States and Denton Wilde Sapte of Britain. He left SNR Denton in September after having been with the firm or its predecessors since 1991.

A graduate of Queen Mary College, University of London in 1978, Mr. Morris qualified as a barrister in 1979 and as a solicitor in 1990.

CareFusion to Buy General Electric Unit for $500 Million

CareFusion. (PRNewsFoto/CareFusion)

SAN DIEGO, Nov. 18, 2013 /PRNewswire/ -- CareFusion Corp. (NYSE: CFN), a leading, global medical technology company, today announced the signing of a definitive agreement for CareFusion to acquire the Vital Signs division of GE Healthcare for $500 million.

With annual revenue of approximately $250 million, Vital Signs is a leading manufacturer of single-patient-use consumables for respiratory care and anesthesiology. The company also markets products for temperature management and patient monitoring consumables.

The acquisition will significantly expand CareFusion's Specialty Disposables business by adding global scale and new products for anesthesiology, establishing the company as a leader in the more than $3 billion market for respiratory and anesthesia consumables.

"The acquisition of Vital Signs is well-aligned to our long-term growth strategy, helping us create scale in our Procedural Solutions call points and increase our presence outside of the United States," said Kieran T. Gallahue, chairman and CEO of CareFusion. "Together, CareFusion and Vital Signs have the R&D, manufacturing and go-to-market resources to drive innovation, invest for growth and better support customers in major geographic markets."  

Strategic fit

With complementary product lines and geographies, the acquisition will enable CareFusion to:

• Better serve customers globally: With approximately one-third of its revenue coming from customers outside the U.S., Vital Signs will advance CareFusion's goal to expand in international markets. The combined sales force will have deep customer and clinical expertise in major global markets.  
• Accelerate the transformation of the Specialty Disposables business from a distributor to a vertically integrated manufacturer: With the addition of the Vital Signs portfolio, CareFusion will become a full-line provider of more than 20,000 single-use consumables for respiratory care and anesthesiology, including circuits for oxygen and anesthesia, humidification, masks, filters, pressure infusers and temperature management products.
• Create clear synergy opportunities: Synergies from the transaction are expected to reach $10 million to $15 million per year on a pretax basis by fiscal 2017. CareFusion sees opportunities to improve top- and bottom-line results by increasing international product sales through Vital Signs' complementary infrastructure outside of the U.S. and by leveraging CareFusion's operational infrastructure.

"We are confident this transaction will provide Vital Signs new capabilities to maximize its opportunities in the medical consumables space and enable GE Healthcare's Life Care Solutions segment to remain focused on its core strengths as a provider of medical device solutions," said Tom Gentile, president and chief executive officer f GE Healthcare's Healthcare Systems division. "We believe CareFusion is equipped to unlock the growth potential of Vital Signs with a solid focus and strategy around medical consumables."

The acquisition is expected to be neutral to modestly accretive to CareFusion adjusted diluted earnings per share in fiscal 2014 and $0.05 to $0.08 accretive in fiscal 2015 excluding amortization of acquired intangible assets, non-cash inventory valuation step-up charges, and nonrecurring restructuring, integration and tax charges. The company expects continued earnings accretion in fiscal 2016 and longer term. 

CareFusion expects to complete the acquisition for the Vital Signs business in the United States, China and certain other countries by Dec. 31, 2013, and to finalize the remainder of the transaction during its third quarter, ending March 31, 2014, subject to regulatory review and customary closing conditions.

Upon completion of the transaction, Vital Signs will be CareFusion's eighth acquisition since 2010.

Headquartered in Totowa, New Jersey, Vital Signs has more than 1,000 employees in three primary locations worldwide, including manufacturing operations in Shenzhen, China, and a global, field-based sales organization.

Conference Call

CareFusion will host a webcast and conference call today at 6 a.m. PST (9 a.m. EST) to discuss the acquisition.

To access the call, visit the Investors page at www.carefusion.com. Log on at least 15 minutes before the call begins to register and download or install any necessary audio software.

Investors and other interested parties may also access the call by dialing 877.415.3178 within the U.S. or 857.244.7321 from outside the U.S. and using the access code 87173662. A replay of the conference call will be available from 10 a.m. PST (1 p.m. EST) on Nov. 18 through 11:59 p.m. PST on Nov. 25 and can be accessed by dialing 888.286.8010 in the U.S. or 617.801.6888 from outside the U.S. and using the access code 38703278.

About CareFusion Corporation

CareFusion (NYSE: CFN) is a global corporation serving the health care industry with products and services that help hospitals measurably improve the safety and quality of care. The company develops industry-leading technologies including Alaris® infusion pumps, Pyxis® automated dispensing and patient identification systems, AVEA®, AirLife® and LTV® series ventilation and respiratory products, ChloraPrep® products, MedMined® services for data mining surveillance, V. Mueller® surgical instruments, and an extensive line of products that support interventional medicine. CareFusion employs approximately 15,000 people across its global operations. More information may be found at www.carefusion.com.

Use of Non-GAAP Financial Measures by CareFusion Corporation

This CareFusion news release and the information contained herein discuss "adjusted diluted earnings per share," which is a non-GAAP financial measure.  The most directly comparable GAAP financial measure is diluted earnings per share from continuing operations.  Historically, the company's presentation of adjusted diluted earnings per share excluded amortization of acquired intangibles, as well as nonrecurring restructuring and acquisition integration charges and nonrecurring tax items. Going forward, the company intends to also exclude inventory valuation step-up charges from acquisitions.  In connection with acquisition transactions, including the proposed acquisition of Vital Signs, the company acquires inventory that is recorded at fair value at the time of the acquisition. As the value of acquired finished goods inventory is recrded at the anticipated customer sales price less cost to sell (fair value), which is generally higher than the historical carrying value, the company must record a charge equal to the difference between the fair value and historical carrying value as the underlying product is sold.  Going forward, the company will exclude the amount of inventory valuation step-up charges from its adjusted results, as the company does not believe such non-cash charges are reflective of ongoing operating results.  The company's management uses non-GAAP financial measures to evaluate the company's performance and provides them to investors as a supplement to the company's reported results, as they believe this information provides additional insight into the company's operating performance by disregarding certain non-recurring items.  Additional information regarding the company's use of non-GAAP financial measures can be found in the company's Form 8-K furnished to the SEC on November 18, 201! 3 and on CareFusion's website at www.carefusion.com under the Investors tab. 

Cautions Concerning Forward-looking Statements

This CareFusion news release and the information contained herein contains forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. The matters discussed in these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. Forward looking statements include, but are not limited to, statements about the timing of the anticipated acquisition, the financing of the anticipated acquisition, the potential benefits and synergies of the anticipated acquisition, including the expected impact on future financial and operating results, and post acquisition plans and intentions. The forward-looking statements contained herein are based on the current expectations and assumptions of CareFusion and not on historical facts. The following importantfactors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: the satisfaction of conditions to closing the agreement; the risk that the businesses will not be integrated successfully; and the risk that benefits and synergies from the acquisition may not be fully realized or may take longer to realize than expected. Additional factors that may affect future results are described in CareFusion's Quarterly Report on Form 10-Q for the quarter ended September 30, 2013 and Annual Report on Form 10-K for the year ended June 30, 2013. Except to the limited extent required by applicable law, CareFusion undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

(Logo: http://photos.prnewswire.com/prnh/20100706/CAREFUSIONLOGO)

 

SOURCE CareFusion Corp.

RELATED LINKS
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Advent International to Take Dutch Firm Private for $1.58 Billion

LONDON â€" The private equity firm Advent International has reached a deal to take private Unit4, a software provider based in the Netherlands, for 1.17 billion euros in cash, or $1.58 billion.

The offer of 38.75 euros a share represents a 32.4 percent premium over Unit4’s Oct. 11 closing price. On Oct. 14, Unit4 publicly announced it had been approached by several potential buyers. Unit4, which has 4,300 employees worldwide and provides software services including cloud computing, had nearly 470 million euros in revenue in 2012.

The deal follows a competitive bidding process and Unit4’s board unanimously recommended accepting the Advent offer, saying it included the highest price and other non-financial considations.

“Not only have we been able to negotiate the highest offer price, but we were also able to ensure the best non-financial covenants, thus safeguarding the interests of all our stakeholders,” said Philip Houben, chairman of Unit4’s supervisory board.

The firm said it had the right to terminate the deal if it has receives a more beneficial offer. The deal includes a $10 million termination fee and is subject to regulatory approval.

Advent, based in Boston, has focused on buyouts of a variety of sectors, including technology, media and telecommunications.

“We are looking forward to making another investment in the Netherlands. We have been investing in the software industry for over 20 years,” said Fred Wakeman, Advent’s managing partner.

The deal was structured so that Unit4 will have the flexibility to make substantial investments in research and development and to potentially fund future mergers that supplement its business, the companies said.

Chris Ouwinga, Unit4’s founder, is expected to remain as chairman of the firm’s management board.

ING and Oppenheimer & Company served as financial advisers to Unit4, while Goldman Sachs was Advent’s financial adviser.

The legal advisers were De Brauw Blackstone Westbroek for Unit4 and Allen & Overy for Advent.