Friday, June 25, 2004
Honor Among Thieves (and Torturers...)
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Wanna know where the Iraqi prison torture scandal came from?
Titan: Lockheed won't extend deadline
As you know, Titan Corporation, of San Diego, CA, is ass-deep in the torture horrors at Abu Ghraib. Their paramilitaries showed up in unmarked uniforms and with tons of bravado, and—with the tacit approval of Bush administration officials and the military commanders in field—directed our untrained Reserve and Guard units into committing unspeakable acts.
For Titan, this was simply a business deal.
A desperate business deal.
As we see here, Titan already has major legal headaches with the Justice Department over their running afoul of the Foreign Corrupt Practices Act (i.e., international bribery charges).
[Side note: Yikes! Just HOW MUCH worse than simple corporate corruption must a company's malfeasence be to warrant a serious corruption probe from the Justice Department according to John Ashcroft?!? "Check your pockets! Hide the women and children! We're talkin' Evildoers, here!"]
Titan's consultants allegedly bribed foreign officials to win military radio contracts. The probe concerns the dealings of three Titan business units operating in West Africa, Asia, and the Middle East.
The SEC has told Titan it is leaning towards pressing civil charges.
This, obviously, is not just a couple of rogue operatives. This is pointed at three different business units in various parts of the world.
Even in a worldwide corporate and political climate where stuffed envelopes are shoved across luncheon tables with regularity, Titan obviously overreached— they became either too greedy or too desperate for contracts for even THIS crowd to stomach.
Fast forward:
Titan has entered into a deal with Lockheed Martin of Bethesda, MD, the No. 1 U.S defense contractor, where Lockheed will take over Titan in a $1.6 billion deal.
But Lockheed is becoming increasingly nervous:
Lockheed ... has been concerned that the outcome of the federal inquiry may affect its future government contracting business.
Under the terms of the deal it would have to approve the consent agreements Titan enters with the Justice Department and the Securities and Exchange Commission. (Clip)
Titan must pay Lockheed $60 million under "certain conditions" if the deal is terminated, according to SEC filings.
Titan is quickly running out of time.
To complete the merger, Titan must either enter a plea agreement with the Justice Department or get written confirmation by Friday that the probe is complete and will not result in any fines. Titan has set aside $3 million to cover the costs of any possible fines.
Under the amended deal terms, Lockheed or Titan can terminate the deal after Friday if the conditions are not satisfied.
In a statement issued Thursday, Titan (NYSE: TTN) said, based on information received from the government by both Titan and Lockheed (NYSE: LMT), it does not expect a definitive plea agreement can be finalized before the deadline.
Titan also said it has not received any information from Lockheed concerning whether or not it will terminate the merger deal.
"Titan asked us to amend the agreement again to authorize another extension," said Lockheed spokesman Tom Jurkowsky. "We declined to do so. We weren't under any obligation."
Not good. They're talking to each other through the press. That's not good in the New York Yankees' clubhouse, and it's not good during merger talks.
What you hear, folks, is the sound of Titan sweating.
Let's see... . Let's sum up:
They've overreached in their international client dealings to the point where they've offended even George W. Bush's "I Call You My Base" constituency, and that Base is about to lower the boom on our favorite little private army corporation.
As a result, they've become contaminated goods, and their $1.6 billion payday is ready to tank
They had a client (the Pentagon) who was breathing down their necks, as clients often do in business today, perhaps as they do in your office or plant.
Titan's client was getting killed in the world press for the astonishing speed of the unraveling of their Iraq plan. They HAD to stop this rising insurgency. But they had no clue as to what really was going on and who, if anyone, was in charge of it all.
So Titan puts more boots on the ground in Iraq. The administration clears the way through the military red tape for them, then becomes increasingly more demanding: More Results. More Results. We don't care how you do it, just get us more information!
Voila! Abu Ghraib. Camp Bucca. And the rest.
And Lockheed is afraid that Titan might hurt its image?
Lockheed is lucky they don't have a shareholder revolt of their own.
Pop Quiz:
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or your Senator represented YOUR interests?
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posted by Gotham 11:55 AM
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