Midday Movers: Bell Atlantic, Vodafone AirTouch, KLM and Cable & Wireless

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Bell Atlantic (BEL) and Vodafone AirTouch (VOD) - Get Report said they would spin off a part of their U.S. wireless joint venture, Verizon Wireless , in an IPO. The companies said Verizon would put $3 billion toward developing its network. Bell Atlantic advanced 2 3/16 to 65 1/4, while Vodafone AirTouch declined 4 1/2, or 8.1%, to 51.

Mergers, acquisitions and joint ventures

Italian airliner

Alitalia

stated today that a merger with its strategic partner

KLM Royal Dutch Airlines

(KLM)

was only one of the issues currently under discussion between the two. The Italian financial daily

Il Sole 24

reported earlier that Alitalia and KLM had stepped up talks to consider a full merger. KLM Royal Dutch Airlines lifted 3/16 to 20 3/8.

Cable & Wireless

(CWP)

lost 3 13/16, or 7.1%, to 49 9/16 after it said it entered a three-year, $91 million online hosting agreement with

Microcast

. The deal calls for Cable & Wireless to supply the video-streaming provider with Web connectivity that would link Microcast's video-server installations to Cable & Wireless' Internet protocol network.

Interpublic Group

(IPG) - Get Report

, an advertising firm, and

NFO Worldwide

(NFO) - Get Report

said that the terms of their planned merger have been adjusted, leaving Interpublic to pay $581 million in stock for NFO. According to the revised deal, NFO holders would now receive .5503 shares of Interpublic, with the breakup fee rising to $30 million from $25 million. NFO can only exercise its terminate option if Interpublic's price drops below $44.80. NFO said it received a rival bid from a third party which it said was unacceptable. Interpublic Group climbed 1 1/4 to 48 5/8. NFO Worldwide also rose 1 5/19, or 5.5%, to 25 1/16.

JDS Uniphase

(JDSU)

, which specializes in fiber-optic equipment, said it has agreed to acquire privately held

Cronos Integrated Microsystems

in a stock deal valued at $750 million. Cronos develops micro-electromechanical systems that are incorporated into optical communication switches. JDS Uniphase fell 15, or 13.4%, to 96 5/8.

The

European Commission

said it has postponed its deadline to render a decision on the

MCI WorldCom

(WCOM)

and

Sprint

(FON)

merger until July 11. According to the EU, the initial July 4 deadline was extended by a week to allow the agency to gather additional information from the company. MCI WorldCom dropped 15/16 to 44 1/2, while Sprint descended 3/4 to 62.

Solectron

(SLR)

, an electronic manufacturing services company, announced an agreement with

Nortel Networks

(NT)

to acquire some of Nortel's assets in North America and Asia. The companies are also discussing outsourcing certain manufacturing and repair operations in Europe. Under terms of the deal and proposed agreements, Solectron will pay approximately $900 million to assume these operations. The companies also agreed to enter into a four-year supply agreement valued in excess of $10 billion. Solectron rose 2 5/8, or 6.7%, to 41 7/8, while Nortel Networks slumped 14, or 11.7%, to 105 3/4.

Earnings/revenue reports and previews

(

Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.

)

Ariba

(ARBA)

dropped 3 9/16 to 85 1/8 after said that it would post second-quarter revenue of between $36 million and $38 million, edging out the analyst consensus estimates by 25% to 30%. The 22-analyst estimate sees the company reporting a loss of 8 cents a share. The company attributed the solid revenue outlook to B2B platform demand.

Separately,

Bank of America

(BAC) - Get Report

and Ariba said they entered a B2B e-commerce pact. Bank of America fell 5/16 to 55 3/16.

Avnet

(AVT) - Get Report

, a distributor of electronic components and computer products, stated that it expects third-quarter earnings per share, before special charges, to exceed analysts' estimates by about 10%. The six-analyst estimate calls for third-quarter earnings of 92 cents a share. Avnet said third-quarter sales exceeded $2.6 billion, reflecting a cyclical recovery in the electronic components industry and the company's recent acquisition activity. Avnet declined 1 15/16 to 59 3/8.

Fairchild Semiconductor

(FCS)

said first-quarter sales would increase 10% from the fourth quarter. Fairchild also said it expects first-quarter earnings to beat the four-analyst estimate of 38 cents a share. The company said it is aiming to double its revenue by 2002 and hit a 10% market share. Fairchild Semiconductor moved down 1 3/8 to 33 5/16.

Federated Department Stores

(FD)

said its March same-store sales fell 0.6%. Federated Department Stores lost 1 to 41 3/4.

Kaiser Aluminum

(KLU)

announced that its financial results for the first quarter of 2000 will include a pre-tax gain of approximately $14 million, or 11 cents a share after tax, to reflect "mark-to-market adjustments" on certain aluminum hedging contract positions. Kaiser Aluminum stayed flat at 4 3/4.

Picturetel

(PCTL)

cautioned investors that its first-quarter revenue and earnings would fall short of previous forecasts. The company said it expects to post a first-quarter loss between 55 cents and 60 cents a share, wider than the four-analyst estimate of a 34-cent loss. Picturetel blamed the weak results on customer order deferrals. Picturetel fell 1 7/8, or 22.7%, to 6 3/8.

Unisys

(UIS) - Get Report

warned investors that it would report first-quarter revenue of between $1.66 billion and $1.69 billion, falling below prior forecasts. The company said it remains on track to post first-quarter earnings within the 11-analyst estimate range of 33 cents to 34 cents a share. The company blamed its revenue shortfall on a softer-than-expected sales recovery after Y2K. Unisys declined 3 7/16, or 13.5%, to 22.

Walgreen

(WAG)

said its March same-store sales increased 8%. Walgreen rose 1 7/16, or 5.7%, to 26 7/8.

Offerings and stock actions

Teligent

(TGNT)

slipped 5 7/16, or 9.9%, after pricing a 5 million-share offering of its Class A stock at $50 a share.

Analyst actions

This morning,

Procter & Gamble

(PG) - Get Report

was upgraded to buy from market perform at

Donaldson Lufkin & Jenrette

. The firm -- which placed a 70 to 75 12-month price target on the stock -- said that Procter & Gamble shares were "oversold within its group." Procter & Gamble popped 3 7/16, or 5.7%, to 63.

Bear Stearns

rolled out coverage of

Ballard

(BLDP) - Get Report

and

Power Plug

(PLUG) - Get Report

with buy ratings. Ballard slipped 8, or 10%, to 71 5/8 and Power Plug edged up 3 11/16 to 79 7/8.

Bindview

(BVEW)

: rating DOWN to near-term accumulate from buy at

Merrill Lynch

; rating DOWN to market perform from buy at

Deutsche Banc Alex. Brown

. Bindview sank 16 1/2, or 64.5%, to 9 1/16.

Core Laboratories

(CLB) - Get Report

: DOWN to buy from strong buy at

Alex. Brown

. Core Laboratories declined 7/16 to 30 9/16.

Diamond Offshore Drilling

(DO) - Get Report

: rating UP to buy from hold at

Warburg Dillon Read

. Diamond Offshore Drilling slid 7/16 to 41 3/8.

Emerson Electric

(EMR) - Get Report

: coverage INITIATED with a strong buy rating at

Morgan Stanley

. Emerson Electric jumped 2 7/16 to 55 1/2.

Espeed

(ESPD)

: NEW strong buy; price target of 80

at CIBC World Markets

. Espeed lost 9 1/2, or 21%, to 35 1/2.

Ingersoll-Rand

(IR) - Get Report

: coverage INITIATED with an outperform rating and a 57 price target at

Lehman Brothers

. Ingersoll-Rand lifted 2 11/16, or 6%, to 46 15/16.

Louis Dreyfus Natural Gas

(LD) - Get Report

: DOWN to hold from strong buy at Warburg Dillon Read. Louis Dreyfus Natural Gas fell 3/16 to 28 7/8.

Parker Hannifin

(PH) - Get Report

: coverage INITIATED with an outperform rating and a 50 price target at Lehman Brothers. Parker Hannifin added 13/16 to 42 5/8.

R&B Falcon

(FLC) - Get Report

: rating UP to buy from hold and price target raised to 35 at Warburg Dillon Read. R&B Falcon skidded 1 7/16, or 6.7%, to 19 13/16.

Rowan

(RDC)

: rating UP to buy from hold; price target UP to 42 at Warburg Dillon Read. Rowan declined 1 1/8 to 28 7/8.

StarTek

(SRT) - Get Report

: DOWN to hold from buy at

Credit Suisse First Boston

. StarTek plummeted 23, or 31%, to 51.

Telecorp PCS

(TLCP)

: NEW buy; price target of 56 at Alex. Brown. Telecorp PCS slid 4, or 7.4%, to 49 5/8.

Tiffany

(TIF) - Get Report

: NEW rating of buy and price target of 100 at

Thomas Weisel

by analyst Anne-Marie Lillestrand. Tiffany stumbled 2 to 81.

UAL

(UAL) - Get Report

: UP to buy from hold at

ING Barings

. UAL was unchanged at 60 1/8.

Miscellany

A federal judge ruled that

Microsoft

(MSFT) - Get Report

broke federal antitrust law by abusing its monopoly in PC operating systems. Judge Thomas Penfield Jackson said the software maker violated key parts of the

Sherman Antitrust Act. The finding will lead to consideration of penalties, including a possible breakup of the company.

Microsoft said it would eventually appeal the judge's ruling and expressed confidence that it would prevail in the case. Microsoft fell 3 13/16 to 87 1/16.

For more details on the decision, see separate

coverage from the

TheStreet.com/NYTimes.com

joint newsroom..

E*Trade

(EGRP)

was losing 4 7/8, or 185, to 22 1/2 after it said it would offer online banking services, which include interest-bearing checking and savings accounts through it newly launched

E*Trade Bank

. The Web brokerage merged with

Telebank

, an online bank, less than three months ago. The service would enable users to combine and move funds between their bank and brokerage accounts.

The Heard on the Street column in

The Wall Street Journal

discusses investors' shift to Old Economy stocks in the wake of the carnage in Microsoft and the

Nasdaq's

nose dive yesterday.