Employers Reinsurance Corp

Warren Buffett may buy General Electric Co.'s Employers Reinsurance Corp., making the investor's Berkshire Hathaway Inc. the world's biggest reinsurer by premium income, people familiar with the situation said Sunday. Price is the major obstacle, they said. Buffett has offered less than the $8 billion GE wants, questioning whether the unit has sufficient loss reserves, they said.

Warren Buffett may buy General Electric Co.'s Employers Reinsurance Corp., making the investor's Berkshire Hathaway Inc. the world's biggest reinsurer by premium income, people familiar with the situation said Sunday. Price is the major obstacle, they said. Buffett has offered less than the $8 billion GE wants, questioning whether the unit has sufficient loss reserves, they said.

General Electric Co. reported a 16% increase in second-quarter earnings to $720 million, reflecting strong revenue growth in its financial services, aircraft engine and plastics and medical systems business units. The Fairfield, Conn.-based company said revenue was up 23%. In individual business units, the company said its financial services unit performed favorably despite the record $25.3-million settlement that Kidder, Peabody & Co.

General Electric Co. is considering selling a 20% stake in its property and casualty reinsurance unit to the public and spinning off the remainder to investors later this year, people familiar with the situation said. An initial public offering for shares in Employers Reinsurance Corp., a unit of GE's financial arm GE Capital, could raise $2 billion, and the unit as a whole could fetch about $10 billion, the people said.

General Electric Co., the nation's sixth-largest industrial company, said its profit jumped 16% in the first quarter to $624 million, largely due to good results at its RCA Corp. subsidiary. Fairfield, Conn.-based GE recorded net income of $537 million in the same quarter a year ago. Revenue jumped to $8.32 billion from $5.88 billion, a rise of more than 40%. RCA owns National Broadcasting Co., the top-rated TV network.

Travelers Property Casualty Corp.'s shares notched solid gains in Friday's trading debut, bucking the market's down trend, after the Citigroup Inc. unit generated $3.88 billion in the biggest U.S. initial public offering this year and the biggest insurance industry IPO ever. Travelers, which trades under the ticker symbol TAP/A, climbed $1.06 to close at $19.56 on the New York Stock Exchange. With trading volume of 86.2 million shares, it was by far the Big Board's most active issue.

New York Atty. Gen. Eliot Spitzer's office interviewed class-action attorneys about difficulties they had getting malpractice insurance as part of his probe of collusion in the insurance industry, said Fred Isquith, president of the National Assn. of Shareholder and Consumer Attorneys. Isquith and others say insurers may be seeking retribution against class-action lawyers, whom they blame for driving up the cost of litigation claims.

A Los Angeles judge Tuesday put on hold a lawsuit filed by the church's insurers accusing Cardinal Roger M. Mahony of withholding information about claims that the archdiocese failed to protect children from sexually abusive priests. Four of the 15 insurers -- Employers Reinsurance Corp. and three members of American International Group Inc. -- Insurance Co. of the State of Pennsylvania, Granite State Insurance Co. and American Home Assurance Co.

General Electric Co., the largest company by market value, said Friday that its third-quarter profit will be less than analysts' forecasts because of an estimated $400 million in losses at its reinsurance business after the terrorist attacks on the World Trade Center. The company said net income will be about 33 cents a share, 4 cents less than the average estimate of analysts surveyed by Thomson Financial/First Call. General Electric had profit of 32 cents a share in the year-ago period.

With multibillion-dollar deals expected this week from Citigroup Inc.'s Travelers insurance unit and Nestle's eye-care giant Alcon, the market for initial public stock offerings shows signs of snapping out of an 18-month rut. Companies have raised just $2.9billion so far this year by selling new stock to the public, compared with $4.5 billion in the same period a year earlier, based on data from research Web site IPO.com. But analysts expect this week's four IPOs to bring in $6.

Lemuel Boulware, who controlled labor relations for General Electric from 1947 to 1960, was so tough, so uncompromising in his dealings with unions that his "take-it-or-leave-it" style of negotiating union contracts brought a new word into the labor relations lexicon: Boulwarism. But union membership was not affected by Boulware's tactics. It remained high.