Corning to Settle Asbestos Claims

Date: 1 April 2003
Source: Yahoo

Date: 1 April 2003

Corning Inc., the No. 1 maker of fiber-optic cable, on Friday said it has reached an agreement to settle all current and future asbestos claims and will take an after-tax charge of about $200 million.

The Corning, New York-based company said the settlement covers the more than 12,000 asbestos claims it faced when its Pittsburgh Corning Corp. joint venture filed for bankruptcy protection in April 2000.Pittsburgh Corning still faces more than 240,000 claims, but Corning expects those to be settled as part of Pittsburgh Corning's reorganization.Corning said it does not expect to pay any additional money toward those claims.

The $200 million charge will be recorded in Corning's first-quarter results.

Shares of Corning rose as much as 2 percent during the day before closing off 2 cents at $6 on the New York Stock Exchange (News - Websites).

Analysts said the settlement was a good move, allowing Corning to concentrate on its businesses, some of which have been hurt by a slowdown in customer spending.

"They have to show they're putting behind issues like this, so people can focus on things they aren't getting credit for, which is their technology," said Sameer Bhasin, an analyst with Okumus Capital, a hedge fund that does not own Corning shares.

Corning had always maintained it had no liability as it did not run Pittsburgh Corning and was strictly a shareholder.

"While we believe we have strong legal defenses to any claims of direct liability from asbestos products, it is important to bring this matter to closure and eliminate uncertainty going forward," Corning Chief Financial Officer James Flaws said in a statement.

Pittsburgh Corning and Pittsburgh Corning Europe are owned 50 percent by Corning and 50 percent by chemical and paint maker PPG Industries Inc.

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