Business briefs for Dec. 12, 2003

Friday, Dec. 12, 2003 | 11:20 a.m.

Try for $25 million rejected

BIRMINGHAM, Ala. -- A federal judge rejected HealthSouth's bid for $25 million from fired chief executive Richard Scrushy, who was ordered by a judge in Delaware to pay that amount to the rehabilitation clinic operator.

HealthSouth asked U.S. District Judge Karen Bowdre earlier this week to release the $25 million or make Scrushy put up collateral to secure it. But the judge rejected the request Thursday, saying Scrushy's assets have not been seized by the government even though they are frozen while he awaits trial on criminal fraud charges.

HealthSouth filed for the $25 million after a judge in Delaware ruled last week in a shareholder lawsuit that Scrushy had to use cash to repay a $25 million loan he received from HealthSouth in 1999.

Firms approve merger

NEW YORK -- Sony Corp. and Bertelsmann AG agreed to merge their music units, forming the second-largest record company with artists such as Beyonce Knowles and Britney Spears, as the $28 billion global industry contracts for a fourth year.

The companies will each own half of the New York-based venture, to be called Sony BMG, Bertelsmann said in a statement. Terms of the deal, which requires regulatory approval, weren't disclosed.

BMG Chairman Rolf Schmidt-Holtz will be chairman. Sony Music Chairman Andrew Lack will be chief executive. Sony BMG will control a quarter of the worldwide market, second only to Universal Music.

Both music companies have posted losses for the year and have cut jobs to improve results.