Quinn wants minimum wage hike, assault weapons ban

Illinois Gov. Pat Quinn today called on lawmakers to raise the minimum wage, ban assault weapons, allow online voter registration in an annual State of the State speech that sounded a lot like the launch of his 2014 re-election campaign.

Returning to the populist notes that have defined his political career, Quinn laid out a series of choices in a 13-page speech.

“Do we want, in the years to come, a prosperous Illinois where working people continue to have good jobs, where businesses thrive, and where all our children have a world-class education?” Quinn told the House and Senate. “Or do we want to stop the progresss and watch our economic recovery stall?”

Quinn wants Illinois' minimum wage to increase from $8.25 to $10 an hour over the next four years. The federal minimum wage is $7.25 an hour, but Illinois' rate has been higher for years. Business groups are likely to oppose such a change.

The Democratic governor also reiterate his support for gay marriage.

Quinn called for a statewide ban on assault weapons and the sale of high-capacity ammunition magazines. He wants to strengthen background checks and require gun owners to report lost or stolen guns to avoid so-called “straw purchasers.”

The governor also offered some of what he wants as the state moves toward allowing conceal carry following a federal appellate ruling that tossed out the state’s long standing ban.

“Of course, we must abide with the second amendment. But there is no place in our state for military-style assault weapons designed for rapid fire at human targets at close range,” he said. “We must ensure that guns are kept out of everyday public places, because guns don’t belong in our schools, shopping malls, or sports stadiums.”

Elections also was a theme as the governor seeks to allow voters to register online. That could draw criticism from Republicans, who often cry foul about Democratic voting efforts in Chicago.

Quinn also revisited a proposal he has long supported: Asking lawmakers to pass legislation allowing for an open primary in which voters would not have to declare their political party before casting a ballot.

The idea is to increase voter participation, and it comes as Democrats and Republicans alike have begun to shift their focus to the 2014 governor's race. One of Quinn's potential Democratic rivals, former White House chief of staff Bill Daley, recently suggested that Illinois do away with partisan primary elections.

Quinn hopes to seize on a new legislature that may be more willing to consider the idea. In 2010, he tried to push the issue by using his amendatory veto power to rewrite a bill to allow voters to declare their party affiliation privately, but the attempt was rebuffed by legislators.

Political parties historically have opposed open primaries because the elections act as a form of membership drive. By requiring voters to declare a political affiliation in order to vote in primaries, they can create voter lists used to drive fundraising and guide get-out-the-vote efforts.

Quinn also touched on the state's budget woes, specifically the growing pension debt that is pegged at almost $97 billion. Quinn contends that while a lot has been done to turn around the state's economy, it will never fully recover unless legislators pass sweeping reforms to bring the retirement system out of the red.

Quinn has been unsuccessfully pushing since placing it at the top of his priority list during last year's speech.

The governor has backed various proposals, most recently throwing his support behind hybrid legislation sponsored by Senate President John Cullerton, D-Chicago. The measure is an attempt to combine proposals put forth by legislators in the House and the Senate, which have had differing ideas on how to tackle the problem.

Cullerton has said he wants a vote on the measure as soon as possible, but acknowledged it may take time to build support. Those efforts may get a boost next month, when Quinn is expected to lay out his budget plan, which the administration has already warned will include cuts given the pressure pensions have put on spending priorities.

Quinn’s quest to boost the minimum wage comes right out of the Democratic playbook of his predecessor, Rod Blagojevich, while wooing blue-collar labor at the same time. The two Blagojevich campaigns for governor used the minimum wage as a fruitful way to woo the hearts of the state’s minimum wage earners through basic pocketbook politics, often underscoring the point while on the stump in minority and working-class neighborhoods.

The issue fell into a Democratic agenda when Blagojevich, the first Democratic governor in a quarter century, entered office with Democratic majorities in the House and Senate. Only months after he won election, Blagojevich pressed forward with his campaign pledge and passed increases that boosted the minimum wage at that time from $5.15 to $6.50 an hour by 2005, the year before he ran for re-election.

After winning re-election, he pushed through more increases that gradually pushed the state’s minimum wage to current levels.

In his own 2010 campaign, Quinn said Illinois’ minimum wage should be increased every year to reflect the rising cost of living. The position put him sharply at odds with Republican challenger Bill Brady, a Bloomington senator who dismissed Quinn’s campaign position as “populist demagoguery.”

Brady initially supported lowering the minimum wage if he beat Quinn and the state rate remained higher than the federal rate—a posture that prompted Quinn’s campaign to contend Brady wanted to “turn back the clock.” Eventually, Brady said the state minimum wage should hold steady to let the federal minimum wage catch up.

The speech marked Quinn's fourth State of the State address since assuming office after lawmakers impeached and removed ex-Gov. Rod Blagojevich, who is serving a 14-year sentence in a Colorado prison following his conviction on federal corruption charges.

Quinn had been out of public sight for nearly a week as he wrote and rehearsed the speech. The governor once again used a teleprompter after his 2010 off-the-cuff address drew criticism as being rambling and unfocused.

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Exclusive: Microsoft and Symantec disrupt cyber crime ring

BOSTON (Reuters) - Software makers Microsoft Corp and Symantec Corp said they disrupted a global cyber crime operation by shutting down servers that controlled hundreds of thousands of PCs without the knowledge of their users.

The move made it temporarily impossible for infected PCs around the world to search the web, though the companies offered free tools to clean machines through messages that were automatically pushed out to infected computers.

Technicians working on behalf of both companies raided data centers in Weehawken, New Jersey, and Manassas, Virginia, on Wednesday, accompanied by U.S. federal marshals, under an order issued by the U.S. District Court in Alexandria, Virginia.

They seized control of one server at the New Jersey facility and persuaded the operators of the Virginia data center to take down a server at their parent company in the Netherlands, according to Richard Boscovich, associate general counsel with Microsoft's Digital Crimes Unit.

Boscovich told Reuters that he had "a high degree of confidence" that the operation had succeeded in bringing down the cyber crime operation, known as the Bamital botnet.

"We think we got everything, but time will tell," he said.

The servers that were pulled off line on Wednesday had been used to communicate with what Microsoft and Symantec estimate are between 300,000 and 600,000 PCs currently infected with malicious software that enslaved them into the botnet.

The companies said that the Bamital operation hijacked search results and engaged in other schemes that the companies said fraudulently charge businesses for online advertisement clicks.

Bamital's organizers also had the ability to take control of infected PCs, installing other types of computer viruses that could engage in identity theft, recruit PCs into networks that attack websites and conduct other types of computer crimes.

Now that the servers have been shut down, users of infected PCs will be directed to a site informing them that their machines are infected with malicious software when they attempt to search the web.

Microsoft and Symantec are offering them free tools to fix their PCs and restore access to web searches via messages automatically pushed out to victims.

The messages warn: "You have reached this website because your computer is very likely to be infected by malware that redirects the results of your search queries. You will receive this notification until you remove the malware from your computer."

It was the sixth time that Microsoft has obtained a court order to disrupt a botnet since 2010. Previous operations have targeted bigger botnets, but this is the first where infected users have received warnings and free tools to clean up their machines.

Microsoft runs a Digital Crimes Unit out of its Redmond, Washington, headquarters that is staffed by 11 attorneys, investigators and other staff who work to help law enforcement fight financial crimes and exploitation of children over the web.

Symantec approached Microsoft about a year ago, asking the maker of Windows software to collaborate in trying to take down the Bamital operation. Last week they sought a court order to seize the Bamital servers.

The two companies said they conservatively estimate that the Bamital botnet generated at least $1 million a year in profits for the organizers of the operation. They said they will learn more about the size of the operation after they analyze information from infected machines that check in to the domains once controlled by Bamital's servers.

Their complaint identified 18 "John Doe" ringleaders, scattered from Russia and Romania to Britain, the United States and Australia, who registered websites and rented servers used in the operation under fictitious names. The complaint was filed last week with a federal court in Alexandria and unsealed on Wednesday.

The complaint alleges that the ringleaders made money through a scheme known as "click fraud" in which criminals get cash from advertisers who pay websites commissions when their users click on ads.

Bamital redirected search results from Google, Yahoo and Microsoft's Bing search engines to sites with which the authors of the botnet have financial relationships, according to the complaint.

The complaint also charges that Bamital's operators profited by forcing infected computers to generate large quantities of automated ad clicks without the knowledge of PC users.

Boscovich said he believes the botnet originated in Russia or Ukraine because affiliated sites install a small text file known as a cookie that is written in Russian on infected computers.

The cookie file contains the Russian phrase "yatutuzebil," according to the court filing. That can loosely be translated as "I was here," he said.

(Reporting By Jim Finkle; Editing by Claudia Parsons)

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Braun says he used Fla clinic owner as consultant

NEW YORK (AP) — Milwaukee Brewers slugger Ryan Braun said the person who ran the Florida clinic being investigated by Major League Baseball was used only as a consultant on his drug suspension appeal last year.

"I have nothing to hide," Braun said in a statement released by his representatives on Tuesday night.

Earlier in the day, Yahoo Sports reported the 2011 NL MVP's name showed up three times in records of the Biogenesis of America LLC clinic. Yahoo said no specific performance-enhancing drugs were listed next to his name.

The Miami New Times recently released clinic documents that purportedly linked Alex Rodriguez, Gio Gonzalez, Melky Cabrera and other players to purchases of banned drugs from the now-closed anti-aging center.

Rodriguez and Cabrera were on the list with Braun that also included New York Yankees catcher Francisco Cervelli and Baltimore Orioles infielder Danny Valencia.

Braun said his name was in the Biogenesis records because of an issue over payment to Anthony Bosch, who ran the clinic near Miami.

"There was a dispute over compensation for Bosch's work, which is why my lawyer and I are listed under 'moneys owed' and not on any other list," Braun said.

"I have nothing to hide and have never had any other relationship with Bosch," he said. "I will fully cooperate with any inquiry into this matter."

On Tuesday, MLB officials asked the Miami New Times for the records the alternative newspaper obtained for its story.

Asked specifically about Braun's name in the documents before the five-time All-Star released his statement, MLB spokesman Pat Courtney said: "Aware of report and are in the midst of an active investigation in South Florida."

Braun tested positive during the 2011 postseason for elevated testosterone levels. He maintained his innocence and his 50-game suspension was overturned during spring training last year when arbitrator Shyam Das ruled in favor of Braun due to chain of custody issues involving the sample.

With that, Braun became the first major leaguer to have a drug suspension overturned.

"During the course of preparing for my successful appeal last year, my attorneys, who were previously familiar with Tony Bosch, used him as a consultant. More specifically, he answered questions about T/E ratio and possibilities of tampering with samples," Braun said.

The T/E ratio is a comparison of the levels of testosterone to epitestosterone.

Braun led the NL in homers (41), runs (108) and slugging percentage (.595) last season while batting .319 with 112 RBIs and 30 stolen bases. He finished second to San Francisco catcher Buster Posey in MVP balloting."

Cervelli, who spent nearly all of last season in Triple-A, posted a statement on Twitter later Tuesday night.

"Following my foot injury in March 2011, I consulted with a number of experts, including BioGenesis Clinic, for (cont)," Cervelli posted, "(cont)legal ways to aid my rehab and recovery. I purchased supplements that I am certain were not prohibited by Major League Baseball."

An email sent to Valencia's agent was not returned.

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Critics seek to delay NYC sugary drinks size limit

NEW YORK (AP) — Opponents are pressing to delay enforcement of the city's novel plan to crack down on supersized, sugary drinks, saying businesses shouldn't have to spend millions of dollars to comply until a court rules on whether the measure is legal.

With the rule set to take effect March 12, beverage industry, restaurant and other business groups have asked a judge to put it on hold at least until there's a ruling on their lawsuit seeking to block it altogether. The measure would bar many eateries from selling high-sugar drinks in cups or containers bigger than 16 ounces.

"It would be a tremendous waste of expense, time, and effort for our members to incur all of the harm and costs associated with the ban if this court decides that the ban is illegal," Chong Sik Le, president of the New York Korean-American Grocers Association, said in court papers filed Friday.

City lawyers are fighting the lawsuit and oppose postponing the restriction, which the city Board of Health approved in September. They said Tuesday they expect to prevail.

"The obesity epidemic kills nearly 6,000 New Yorkers each year. We see no reason to delay the Board of Health's reasonable and legal actions to combat this major, growing problem," Mark Muschenheim, a city attorney, said in a statement.

Another city lawyer, Thomas Merrill, has said officials believe businesses have had enough time to get ready for the new rule. He has noted that the city doesn't plan to seek fines until June.

Mayor Michael Bloomberg and other city officials see the first-of-its-kind limit as a coup for public health. The city's obesity rate is rising, and studies have linked sugary drinks to weight gain, they note.

"This is the biggest step a city has taken to curb obesity," Bloomberg said when the measure passed.

Soda makers and other critics view the rule as an unwarranted intrusion into people's dietary choices and an unfair, uneven burden on business. The restriction won't apply at supermarkets and many convenience stores because the city doesn't regulate them.

While the dispute plays out in court, "the impacted businesses would like some more certainty on when and how they might need to adjust operations," American Beverage Industry spokesman Christopher Gindlesperger said Tuesday.

Those adjustments are expected to cost the association's members about $600,000 in labeling and other expenses for bottles, Vice President Mike Redman said in court papers. Reconfiguring "16-ounce" cups that are actually made slightly bigger, to leave room at the top, is expected to take cup manufacturers three months to a year and cost them anywhere from more than $100,000 to several millions of dollars, Foodservice Packaging Institute President Lynn Dyer said in court documents.

Movie theaters, meanwhile, are concerned because beverages account for more than 20 percent of their overall profits and about 98 percent of soda sales are in containers greater than 16 ounces, according to Robert Sunshine, executive director of the National Association of Theatre Owners of New York State.

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In Vegas, Abrams gives few hints about 'Star Wars'

LAS VEGAS (AP) — A newly announced "Star Wars" sequel was on everyone's mind when J.J. Abrams took the stage Wednesday at a Las Vegas video game conference, but he made only a sideways mention of the film he has been hired to direct.

The reference was a throw-away joke from his last franchise reboot.

The director played a scene from his 2009 "Star Trek" film to illustrate the importance of embroidering films with subtle details, and freeze-framed on a shot of a familiar "Star Wars" robot peeking from space junk.

"So they're looking at all the debris that's out there, and curiously, it's R2D2," he said, drawing a roar of laughter.

Gabe Newell, president of video game developer Valve, shared a stage with Abrams at the Design, Innovate, Communicate, Entertain Summit at the Hard Rock Hotel & Casino.

"So now I have to go back through your movies looking at all the debris to figure out what movie you're going to direct next?" Newell asked.

Abrams has given die-hard fans few clues about his vision for the seventh live-action "Star Wars" film. He was announced as its director in January.

The Sin City appearance left fans of The Force hungering for more insight.

"I'd love to know who they'll focus on, what character, how far in the future it will be set, things like that," said Sadierose Schwartzmiller, 19, a comic-book creator who won her ticket to the event in an art contest.

Abrams has made a name for himself as a trusted steward of beloved fantasy universes, directing well-received additions to the "Star Trek" and "Mission: Impossible" franchises.

"Star Wars" creator George Lucas opened the door to the latest round of spin-offs when he sold his Lucasfilm empire to The Walt Disney Co. for $4.05 billion last fall. The company is planning three sequels and two peripheral movies focusing on characters.

"Episode VII" is tentatively scheduled for release in the summer of 2015.

Last month, Abrams told a group of reporters that he wanted to make sure the sequel was "something that touches people."

On Wednesday, he did give his audience of nerds and gamers one revelation when he announced his intention to collaborate with Newell — the man behind the hit games "Portal," "Half-Life" and "Counter-Strike."

"There's an idea that we had for a game that we'd like to develop," he said.

Fans wanted more information on that, too.

"If they would reveal even the genre," said Kellen Smalley, 32, a gamer. "If they would bring what J.J. does with stories to the 'Star Wars' games, it would be very fun."

Abrams' development company, Bad Robot Interactive, has released apps related to his movies. Newell said his company would like to work with Abrams on a movie adaptation of "Portal" or "Half-Life."

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Hannah Dreier can be reached at http://twitter.com/hannahdreier

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Chicago sees surge in foreclosure auctions

More than 35,000 homes and small multifamily buildings in the Chicago area completed the foreclosure process last year, the highest number since the housing crisis began, and the vast majority of them became bank-owned.

An increase in foreclosure auctions was expected since lenders shelved many foreclosure cases while state and federal authorities investigated allegations of faulty foreclosure processes. Still, the heightened level of auctions — 35,244 in 2012, compared with 20,281 in 2011 — along with an increase in initial foreclosure filings, shows the local housing market has a long road to recovery, according to the Woodstock Institute.

"There's going to be pain in the housing market in the short term," said Katie Buitrago, senior policy and communications associate at Woodstock. "There's still high levels of filings. Five years into it, there is still work to be done to help people save their homes."

The Chicago-based public policy and research group is expected to release its report on 2012 foreclosure activity Wednesday.

The year-end numbers show that, with few exceptions, all Chicago neighborhoods and suburban communities saw high double-digit percentage gains in auctions last year. Across the six-county area, 91.3 percent of the foreclosed properties were repossessed by lenders. At the same time, notices of initial default sent to homeowners, the first step in the foreclosure process, increased by 2.9 percent last year, to 66,783.

Real estate agents have worried for more than two years about a glut of foreclosed properties — a shadow inventory — that banks would list for sale en masse and cause home values to plunge. That largely has not happened, but the vast number of distressed properties in the market has kept a lid on local home values.

On Tuesday, for instance, Fannie Mae and Freddie Mac's websites listed 2,415 Cook County homes for sale that the two agencies had repossessed.

Chicago-area home prices, including distressed sales, fell 2.3 percent in December from a year ago, housing analytics firm CoreLogic said Tuesday. Illinois was one of only four states to see home-price depreciation.

The increase in auctions "is a mixed blessing," Buitrago said. "We've been having a lot of trouble in the region with vacant properties that have been languishing for years. The longer they're vacant, the more likely they are to be a destabilizing force in their communities."

Woodstock found that within the city of Chicago, there were 20 communities where more than 1 in 10 owner-occupied one- to four-unit residential buildings and condos went through foreclosure from 2008 to 2012. Five of those neighborhoods are included in the city's 18-month-old Micro-Market Recovery Program, a coordinated effort to stabilize neighborhoods and property values hit hard by foreclosures and vacant buildings.

Also designed to benefit hard-hit areas are the recent establishment of a Cook County Land Bank and legislation waiting for Gov. Pat Quinn's signature that will fast-track the foreclosure process for vacant, abandoned homes while providing financial resources to foreclosure prevention efforts.

mepodmolik@tribune.com

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Father saw 'horrifying' accident injure son during opera rehearsal

A fire-breathing stilt walker burned when flames flared up on his face during a dress rehearsal at the Lyric Opera of Chicago is expected to be released from the hospital Thursday, his father told the Chicago Tribune.

“It’s horrifying,” said Clifton Truman Daniel, 55, who was in the audience watching his son Wesley when the mishap occurred late Monday afternoon. “You don’t believe it. At first, everything’s fine. You’re proud of him. You’re amazed at what he’s learned to do, and suddenly he’s in trouble.”

The 24-year-old actor was taken in serious-to-critical condition to Northwestern Memorial Hospital suffering burns to his throat and second-degree burns to his face, fire officials said. Initially, it was thought Daniel was not suffering breathing problems, but he apparently was and was transferred to Loyola University Medical Center in critical condition, officials said.

Doctors intubated Daniel as a precaution to help him breathe, his father said. But there was no damage to his lungs or airway and the tube was removed Monday night, according to his father.

"Doctors likened them to a severe sunburn and he will heal,” his father said of the burns. “He shouldn’t have any scarring.”

Clifton Daniel said he was happily sitting in the audience of the Lyric Opera, watching his son walk on stilts and spit fire out of his mouth.

He watched as Wesley Daniel picked up a torch and a little jar of fluid and blew two fire balls. Then suddenly his son’s mask was on fire and he started patting his neck and chest before walking across the stage toward stagehands who were carrying fire extinguishers.

Daniel said he ran to his son backstage, where he was being treated with compresses. Paramedics had already been called and his son was upbeat, even giving a thumbs-up, the father said.

Clifton Truman Daniel said he is the grandson of former President Harry S. Truman and Wesley Daniel is the president's great-grandson.

Wesley Daniel said his son graduated from Roosevelt University and has been acting for about three years. He was hired as a back-up for the opera “Die Meistersinger von Nurnberg” in case someone called in sick or didn’t show up. Wesley Daniel stepped in when an actor was injured last week, his father said.

David Kersnar, who directed Daniel in Lookingglass and Next Theatre productions last year and also worked with him at Roosevelt University, described the young actor as an experienced physical performer with circus training. 

“It was the first time he was on the Lyric stage, but this is what he does,” said Kersnar, a Roosevelt adjunct professor. “He’s very funny, very strong, very skilled and smart. He doesn’t do stupid stuff. I was very surprised to hear this went wrong.”

Kersnar said Daniel performed various stunts for him, such as dressing as an ingenue and lifting the title character of “Pulcinella,” at the Lookingglass performance with the Chicago Symphony Orchestra. “This is the actor life. They do a lot of different things. He’s a jack of all trades.”

Kersnar was on his way to visit Daniel in the hospital Tuesday after the actor had emailed him a photo. “He’s all bandaged up but he’s got this funny look in his eyes like, ‘Look at the mess I’ve got myself into,’” Kersnar said.

Tribune photographer Jason Wambsgans, who was at the rehearsal, said it appeared Daniel had spilled propellant "on his chin or his chest or something. It kind of consumed him, and he was staggering across the stage and then fell off his stilts on the opposite side of the stage.”

Wambsgans said he arrived at the rehearsal at the beginning of the third act to take pictures for an upcoming Tribune review of the opera “Die Meistersinger von Nurnberg.”

The first scene of the third act took about an hour. It was in the second scene when Wambsgans pulled out a telephotoe lens to take pictures of the busy stage full of extras, in this case, circus performers. Daniel was one of them.

When it appeared that Daniel, on stilts, was ready to put some sort of propellant in his mouth to shoot fireballs, Wambsgans said he started snapping and captured the flames flaring up on Daniel.

Wambsgans said he saw people in the wings of the stage spraying Daniel with fire extinguishers. “Half of the extras were transfixed by that,” Wambsgans said.

It took about 15 more seconds before the rest of the extras stopped singing and acting, realizing what had happened, he said.

After a 30-minute break, a visibly distressed crew was back rehearsing, Wambsgans said. But the rehearsal was cut short, ending about 6 p.m.

Daniel was wearing a flame-proof costume and mask, a spokeswoman for the Lyric said in an email.  The dress rehearsal was interrupted, but it later resumed and was in the last act of “Die Meistersinger von Nurnberg” by about 5:30 p.m.

Daniel was performing a stunt that had been approved by the Fire Department, according to the Lyric.

The Occupational Safety and Health Administration opened up an investigation into the incident after hearing about Wesley’s accident through the media, said spokesman Scott Allen. A compliance officer went to the Lyric Opera House this morning and talked to witnesses and employees to find out what may have caused the accident and if the opera house violated any OSHA regulations, he added.

Drew Landmesser, the Lyric’s deputy general director who focuses on backstage activities, said the company is still trying to determine the accident’s cause.

“We don’t exactly know the cause of the accident, just that it was a terrible accident and he seems to be doing well,” Landmesser said.

He stressed that Daniel was experienced with such a fire-spitting stunt, which he characterized as routine in the entertainment world.

“You’ve seen this a thousand times: at carnivals, at Renaissance fairs, at kids parties,” Landmesser said. “It’s a common routine for a performer like this.”

That said, Daniel was the replacement for a previous performer who was removed after a mishap involving the same stunt.

“He had a handlebar mustache, and handlebar mustaches and fire-spitting don’t go well together,” Landmesser said, noting that the mustache “got singed, but there was no injury.”

Landmesser said Daniel’s mask never caught fire; nor did his costume.

“The fuel he was spitting was the only thing that was on fire,” he said, adding that the stunt has been removed from the production mostly so audience members won’t become distracted during one of the opera’s climatic scenes. “I think that frankly the press made something hysterical that was a rather calm event, but why upset people, let anyone misunderstand what happened or how safe it is?”

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Dell to go private in landmark $24.4 billion deal

SAN FRANCISCO/NEW YORK (Reuters) - Michael Dell will take Dell Inc private for $24.4 billion in the biggest leveraged buyout since the financial crisis, a deal that allows the billionaire chief executive to attempt a revival of his struggling computer company without Wall Street scrutiny.

The deal, which requires shareholder approval, would end a 24-year run on public markets for a company that was conceived in a college dorm room and quickly rose to the top of the global personal computer business - only to be rendered an also-ran over the past decade as PC prices crumbled and customers moved to tablets and smartphones.

Dell executives said on Tuesday that the company will stick to a strategy of expanding its software and services offerings for large companies, with the goal of becoming a full-service provider of corporate computing services in the mold of the highly profitable IBM. They downplayed speculation that Dell might spin off the low-margin PC business on which it made its name.

Dell did not give specifics on what it would do differently as a private entity to convince skeptics who say it missed the big industry shift to tablet computers, smartphones and high-powered consumer elections devices such as music players and gaming consoles. Sources with knowledge of the matter said Dell's board had considered everything from a recapitalization to a breakup of the company before going the leveraged buyout route, but did not elaborate.

"A private Dell is likely to more aggressively cut costs, in our view. But we think merely restructuring only postpones the inevitable, creating a value trap," said Discern Inc analyst Cindy Shaw. "Dell needs to do more than reduce its cost structure. It needs to innovate."

The deal will be financed with cash and equity from Michael Dell, cash from private equity firm Silver Lake, a $2 billion loan from Microsoft Corp, and debt financing from a consortium of banks. The price of $13.65 per share represents a 25 percent premium over Dell's stock price before news of a pending deal leaked in January.

The company will now conduct a 45-day "go-shop" process in which others might make higher offers.

"Though we were hoping for a higher price, we trust that the Dell board has properly done its job by conducting a process open to any third party offers and reviewing all strategic options," said Bill Nygren, who manages the $7.3 billion Oakmark Fund and $3.2 billion Oakmark Select Fund, which have a $250 million position in Dell. "Should we hear evidence to the contrary, we'll raise a ruckus."

Some of Dell's rivals took pot shots at the deal, in unusually pointed comments that reflect how bitter the struggle is in a commoditized PC industry that has wrestled to reverse a decline in sales globally.

Hewlett-Packard Co, which itself has suffered years of turmoil in the face of challenges in the PC business, said in a statement that Dell's deal would "leave existing customers and innovation at the curb," and vowed to exploit the opportunity.

Lenovo, which consists largely of the former IBM PC unit, referred to the "distracting financial maneuvers and major strategic shifts," of its rival while emphasizing its own stability and strong financial position.

Dell was regarded as a model of innovation as recently as the early 2000s, pioneering online ordering of custom-configured PCs and working closely with Asian component suppliers and manufacturers to assure rock-bottom production costs. But as of 2012's fourth quarter, Dell's share of the global PC market had slipped to just above 10 percent from 12.5 percent a year earlier as its shipments dived 20 percent, according to research house IDC.

Michael Dell returned to the company as CEO in 2007 after a brief hiatus, but has been unable to engineer a turnaround thus far. Dell's focus on corporate computing in recent years has yet to yield results - and critics note competing successfully against incumbents, including IBM and HP, will not be easy no matter what the corporate structure.

Sales of PCs still make up the majority of Dell's revenues. Analysts say continued restructuring to focus on the corporate market may entail job cuts and more costly acquisitions. The company has acquired several large software and services companies in recent years as it seeks to reconfigure itself as a broad-based supplier of technology for big companies.

"We recognize this process will take more time," Chief Financial Officer Brian Gladden told Reuters. "We will have to make investments, and we will have to be patient to implement the strategy. And under a new private company structure, we will have time and flexibility to really pursue and realize the end-to-end solutions strategy."

Gladden said the company's strategy would "generally remain the same" after the deal closed, but "we won't have the scrutiny and limitations associated with operating as a public company."

Michael Dell, who has quietly built a highly successful investment firm even as the fortunes of his namesake company have waned, will contribute his 16 percent share of Dell's equity to the deal, along with cash from his MSD Capital. Bank of America Merrill Lynch, Barclays, Credit Suisse and RBC Capital Markets will offer debt financing.

Shares of Dell were up 1.2 percent at $13.43 in morning trading.

RECORD BUYOUT

Analysts said Dell could be more nimble as a private company, but it will still have to deal with the same difficult market conditions. IBM's famously successful transition from hardware vendor to corporate IT partner took place while it was trading on public markets.

There is little history to suggest whether going private makes such a transition easier. Freescale, formerly the semiconductor division of Motorola, was taken private in 2006 for $17.6 billion by a group of private equity firms including Blackstone Group LP, Carlyle Group and TPG Capital LP. Analysts say the resulting debt load hurt its ability to compete in the capital-intensive chip business. Freescale cut just under 5 percent of its work force last year as it continued to restructure.

The Dell deal would be the biggest private equity-backed, leveraged buyout since Blackstone Group LP's takeout of the Hilton Hotels Group in July 2007 for more than $20 billion, and is the 11th-largest on record.

The parties expect the transaction to close before the end of Dell's 2014 second quarter, which ends in July. News of the talks first emerged on January 14, although they reportedly started in the latter part of 2012. Michael Dell had previously acknowledged thinking about going private as far back as 2010.

Microsoft's involvement in the deal piqued much speculation about a renewed strategic partnership, but the software company is providing only debt financing and Dell said there were no specific business terms attached to the transaction. Dell has long been loyal to Microsoft's Windows operating system, which has been at the heart of its PC business since its inception.

Microsoft's loan will take the form of a 10-year subordinated note that will be the "closest thing to equity," with roughly 7 percent to 8 percent interest, a source close to the matter told Reuters.

Banking sources said the debt financing package for the deal will total between $11 billion and $12 billion to back the leveraged buyout. The final size of the financing depends on what portion of the company's existing notes remain outstanding, sources added. The banks are expected to begin reaching out to other lenders to begin syndicating the loans as early as Tuesday.

J.P. Morgan and Evercore Partners were financial advisers, and Debevoise & Plimpton LLP was the legal adviser to the special committee of Dell's board. Goldman Sachs was financial adviser, and Hogan Lovells was legal adviser to Dell.

Wachtell, Lipton, Rosen & Katz was legal adviser to Michael Dell. BofA Merrill Lynch, Barclays, Credit Suisse and RBC Capital Markets were financial advisers to Silver Lake, and Simpson Thacher & Bartlett LLP was its legal adviser.

(Additional reporting by Greg Roumeliotis; Writing by Ben Berkowitz and Edwin Chan; Editing by Tiffany Wu and Leslie Gevirtz)

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Lindsey Vonn tears knee ligaments, out for season

SCHLADMING, Austria (AP) — Lindsey Vonn will miss the rest of the ski season after tearing knee ligaments and breaking a bone in her leg in a high-speed crash Tuesday at the world championships. The U.S. team expects her to return for the next World Cup season and the 2014 Sochi Olympics.

Vonn lost balance on her right leg while landing a jump in the super-G. She flipped in the air, landed on her back and smashed through a gate before coming to a halt.

The four-time overall World Cup winner and 2010 Olympic downhill champion received medical treatment on the slope for 12 minutes before being taken by helicopter to a hospital in Schladming.

The 28-year-old star tore her anterior cruciate ligament and medial collateral ligament in her right knee. U.S. team medical director Kyle Wilkens said in a statement. The broken bone in her lower leg was described as a "lateral tibial plateau fracture."

Christian Kaulfersch, the assistant medical director at the worlds, said Vonn left the Schladming hospital Tuesday afternoon and will have surgery at another hospital.

"She first wanted to go back to the team hotel to mentally deal with all what has happened," Kaulfersch said.

Team physician William Sterett was with Vonn but declined to offer any more information when contacted by The Associated Press.

This is the sixth straight major championship in which Vonn has been hit with injuries. The crash in the opening event of the championships came almost exactly a year before the Olympics.

"She will be out for the remainder of this season but is expected to return to racing for the 2013-14 ... World Cup season and the 2014 Olympic Winter Games in Sochi," the team said.

Vonn returned to the circuit last month after an almost monthlong break from racing to fully recover from an intestinal illness that put her in a hospital for two days in November.

The start of Tuesday's race was delayed by 3½ hours because of fog hanging over the course and the skiers began in waning light at 2:30 p.m. Even before Vonn's crash, a course worker fell and also had to be airlifted. He was reported to have broken his nose.

All the delays made for flat light when Vonn raced.

"Lindsey did a great job on top and Lindsey has won a lot of races in flat light so the flat light was definitely not a problem," U.S. Alpine director Patrick Riml told the AP.

"We are upset obviously with what happened, but if you don't know the facts and why they decided to start and what the weather forecast was it's hard to say without any reasoning," Riml said. "And they probably had a reason, otherwise they wouldn't have started."

It was difficult to pinpoint when Vonn lost control as she came off a left turn into the jump.

"She jumped a little bit in the wrong direction and started to correct that a little bit in the air and put a lot of pressure on the outside ski exactly in the landing and she couldn't hold the pressure and then (she crashed)," International Ski Federation women's race director Atle Skaardal said.

Skaardal defended the decision to race.

"I can confirm that the visibility was great, there were no problems, and the course was also in good shape," he said. "I don't see that any outside factors played a role in this accident. ... The other factors were like they were supposed to be for ski racing."

Two years ago, Vonn pulled out midway through the last worlds in Garmisch-Partenkirchen, Germany, because of a mild concussion. At the 2010 Vancouver Olympics, Vonn skied despite a severely bruised shin to win the downhill and take bronze in the super-G.

At the 2009 worlds in Val d'Isere, France, she sliced her thumb open on a champagne bottle after sweeping gold in the downhill and super-G, forcing her out of the giant slalom. At the 2007 worlds in Are, Sweden, Vonn injured her knee in training and missed her final two events.

And at the 2006 Turin Olympics, she had a horrific crash in downhill training and went directly from her hospital room to the mountain to compete in four of her five events.

Having regained her form in recent weeks, Vonn trailed eventual race winner Tina Maze of Slovenia by just 0.12 seconds at an intermediate interval shortly before Tuesday's crash.

The conditions varied from racer to racer.

Former overall winner Maria Hoefl-Riesch of Germany started immediately after Vonn and skied off course.

"It's not a very difficult course but in some parts you couldn't see anything," said Fabienne Suter of Switzerland, who finished fifth.

However, Vonn teammate Julia Mancuso thrived in the difficult conditions and won the bronze medal.

"It's the same for everybody," U.S. speed coach Chip White said. "Everyone had to wait for a long time and that's always difficult. And the holds were every 15 minutes so it really doesn't give you a chance to go and do something else. You're always kind of on edge at the ready. It's a difficult situation but everybody had the same difficult situation."

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Critics seek to delay NYC sugary drinks size limit

NEW YORK (AP) — Opponents are pressing to delay enforcement of the city's novel plan to crack down on supersized, sugary drinks, saying businesses shouldn't have to spend millions of dollars to comply until a court rules on whether the measure is legal.

With the rule set to take effect March 12, beverage industry, restaurant and other business groups have asked a judge to put it on hold at least until there's a ruling on their lawsuit seeking to block it altogether. The measure would bar many eateries from selling high-sugar drinks in cups or containers bigger than 16 ounces.

"It would be a tremendous waste of expense, time, and effort for our members to incur all of the harm and costs associated with the ban if this court decides that the ban is illegal," Chong Sik Le, president of the New York Korean-American Grocers Association, said in court papers filed Friday.

City lawyers are fighting the lawsuit and oppose postponing the restriction, which the city Board of Health approved in September. They said Tuesday they expect to prevail.

"The obesity epidemic kills nearly 6,000 New Yorkers each year. We see no reason to delay the Board of Health's reasonable and legal actions to combat this major, growing problem," Mark Muschenheim, a city attorney, said in a statement.

Another city lawyer, Thomas Merrill, has said officials believe businesses have had enough time to get ready for the new rule. He has noted that the city doesn't plan to seek fines until June.

Mayor Michael Bloomberg and other city officials see the first-of-its-kind limit as a coup for public health. The city's obesity rate is rising, and studies have linked sugary drinks to weight gain, they note.

"This is the biggest step a city has taken to curb obesity," Bloomberg said when the measure passed.

Soda makers and other critics view the rule as an unwarranted intrusion into people's dietary choices and an unfair, uneven burden on business. The restriction won't apply at supermarkets and many convenience stores because the city doesn't regulate them.

While the dispute plays out in court, "the impacted businesses would like some more certainty on when and how they might need to adjust operations," American Beverage Industry spokesman Christopher Gindlesperger said Tuesday.

Those adjustments are expected to cost the association's members about $600,000 in labeling and other expenses for bottles, Vice President Mike Redman said in court papers. Reconfiguring "16-ounce" cups that are actually made slightly bigger, to leave room at the top, is expected to take cup manufacturers three months to a year and cost them anywhere from more than $100,000 to several millions of dollars, Foodservice Packaging Institute President Lynn Dyer said in court documents.

Movie theaters, meanwhile, are concerned because beverages account for more than 20 percent of their overall profits and about 98 percent of soda sales are in containers greater than 16 ounces, according to Robert Sunshine, executive director of the National Association of Theatre Owners of New York State.

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Follow Jennifer Peltz at http://twitter.com/jennpeltz

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