AT&T aims for TV's future with $48.5B DirecTV deal

LOS ANGELES — AT&T says it views its planned $48.5 billion purchase of DirecTV as a way to help redefine the video entertainment industry, giving it opportunities to bundle services and tap into growing Latin American markets.

AT&T Inc.'s proposed transaction primes it for the age of Internet-delivered video.

AT&T and DirecTV promised consumer benefits like more economical bundles that tie mobile phone, pay TV and Internet service together on a single bill. AT&T said that it'll probably be 12 to 18 months for robust streaming video offerings to be available, but that bundled offerings should be available soon after the deal closes, which the companies expect to occur within 12 months.

AT&T is currently the second-largest wireless provider with 116 million customers.

The company will gain access to DirecTV's 20.3 million U.S. customers and its 18.1 million Latin American customers. DirecTV's U.S. customers, coupled with 5.7 million U-verse TV customers, will give the combined AT&T-DirecTV 26 million U.S. users for video. That would make it the second-largest pay TV operator behind a combined Comcast-Time Warner Cable, which would serve 30 million under a $45 billion merger proposed in February.

"What it does is it gives us the pieces to fulfill a vision we've had for a couple of years — the ability to take premium content and deliver it across multiple points: your smartphone, tablet, television or laptop," AT&T Chairman and CEO Randall Stephenson said during a conference call Sunday.

Michael White, chairman and CEO of DirecTV Inc., said Monday that his company has been talking off and on with AT&T about a potential transaction for years, but that recent trends in the industry helped make the deal happen now.

The companies are aiming to eke out $1.6 billion in annual cost savings in an increasingly expensive and maturing pay TV business. Using DirecTV's cash flow, AT&T has greater ability to invest in its landline and mobile networks for broader reach and faster speeds in an Internet service market where it risks falling behind a bulked up Comcast-Time Warner Cable.

But the deal could face regulatory scrutiny from the Federal Communications Commission and Department of Justice. Unlike the cable company tie-up, the AT&T-DirecTV merger would effectively cut the number of video providers from four to three for about 25 percent of U.S. households.

Cable companies operate in regions that don't overlap. By comparison, AT&T provides TV service to 22 states, where it is a direct competitor to DirecTV, which operates nationwide. Reducing choice in those markets could result in higher prices for consumers, and that usually gives regulators cause for concern.

White said Monday that customers will see more competitive pricing from the combination with AT&T.

Stephenson said regulatory concerns would be addressed with a number of what he called "unprecedented" commitments. Among them:

— DirecTV would continue to be offered as a stand-alone service for three years after the deal's closing.

— AT&T would offer stand-alone broadband service for at least three years after closing, so consumers could consume video from Netflix and other online services, with download speeds of at least 6 megabits per second where feasible.

— AT&T would expand high-speed broadband access to 15 million more homes — to 70 million total — within four years.

— AT&T vowed to abide by the open Internet order from 2010 that the Federal Communications Commission is now in the process of revising after a court struck it down.

— AT&T vowed to sell its roughly 9 percent stake in Latin American wireless carrier América Móvil for about $5 billion.

Delara Derakhshani, policy counsel for Consumer Reports magazine's lobbying arm, Consumers Union, complained that the deal "is just the latest attempt at consolidation in a marketplace where consumers are already saddled with lousy service and price hikes."

"You can't justify AT&T buying DirecTV by pointing at Comcast's grab for Time Warner, because neither one is a good deal for consumers," she said in a statement.

Under the terms announced Sunday, DirecTV shareholders will receive $28.50 per share in cash and $66.50 per share in AT&T stock, bringing the value to $95 a share. The total transaction value is $67.1 billion, including DirecTV's net debt.

Stephenson and White both said the merger would allow the combined company to offer video over multiple screens, but acknowledged that deals with content providers to expand service on multiple platforms still need to be negotiated.

DirecTV's exclusive deal for its signature product, NFL Sunday Ticket, expires at the end of the coming season. White anticipates that it will come to an agreement with the NFL on an extension before the transaction with AT&T closes.

"This positions us well to compete in the 21st century," White said. "I think our future is bright together in ways that make both of our companies stronger."

Analysts have questioned the strategic benefits of a deal, particularly because it would give AT&T a larger presence in a pay TV market that isn't growing. Last year, pay TV subscribers in the U.S. fell for the first time, dipping 0.1 percent to 94.6 million, according to Leichtman Research Group.

While AT&T and DirecTV are doing better than cable companies at attracting TV subscribers, DirecTV's growth in the U.S. has stalled while AT&T is growing the fastest of any TV provider.

But Stephenson said DirecTV's Latin American presence provides a good growth opportunity. He considers Brazil a key region to potentially add customers in.

DirecTV offers neither fixed-line or mobile Internet service, and its rights to airwave frequencies for satellite TV are not the kind that AT&T can use to improve its mobile phone network.

Still, Stephenson has talked about how the growth of online video helps boost demand for its Internet and mobile services. Last month, AT&T entered a joint venture with the Chernin Group to invest in online video services.

DirecTV would continue to be based in El Segundo, California, following the merger, the companies said. AT&T is based in Dallas.

Shares of AT&T declined 70 cents, or 1.9 percent, to $36.04 in midday trading Monday, while DirecTV's stock fell $1.24, or 1.4 percent, to $84.94.

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Business Writers Dee-Ann Durbin in Detroit and Michelle Chapman in New York contributed to this report.

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AstraZeneca rejects $119 billion offer from Pfizer

LONDON — The board of AstraZeneca on Monday rejected the improved $119 billion takeover offer from U.S. drugmaker Pfizer, a decision that caused a sharp slide in the U.K. company's share price as many investors think it effectively brings an end to the protracted and increasingly bitter takeover saga.

The board said in a statement that it "reiterates its confidence in AstraZeneca's ability to deliver on its prospects as an independent, science led business."

Pfizer, which is the world's second-biggest drugmaker by revenue, has been courting No. 8 AstraZeneca since January, arguing their businesses are complementary. On Sunday, it raised its stock-and-cash offer by 15 percent to $118.8 billion, or 70.73 billion pounds. That would be the richest acquisition ever among drugmakers and the third-biggest in any industry, according to figures from research firm Dealogic.

AstraZeneca didn't take long to reject the new offer, its board arguing Pfizer is making "an opportunistic attempt to acquire a transformed AstraZeneca, without reflecting the value of its exciting pipeline" of experimental drugs.

Because Pfizer said it won't raise its offer again or launch a hostile takeover bid over the heads of AstraZeneca's board, the prospect of a deal looks increasingly remote unless AstraZeneca shareholders urge a change of mind. Pfizer has said it hopes AstraZeneca's shareholders will push for a deal.

"This has been going on for quite some time and we have been in very deep engagement over the whole of the weekend," AstraZeneca Chairman Leif Johansson told the BBC. "If Pfizer now says this is the final offer I have to believe what they say."

Shareholders in AstraZeneca PLC seemed to think a deal is now unlikely, with the company's share price slumping 11.1 percent to 42.87 pounds.

Johansson said his management team had told Pfizer Inc. over the weekend that it would need to see a 10 percent improvement over the 53.50 pounds-per-share offer that was on the table at that time. He said Pfizer's latest offer represented only a "minor improvement" that fell short of the 10 percent needed.

Though it has said its indicative offer is final, Pfizer has, under U.K. takeover rules, until 5 p.m. local time on May 26 to make a formal bid. If it doesn't, it cannot make another offer for six months.

Pfizer's offer comes amid a surge of other deals as drugmakers look to either grow or eliminate noncore assets to focus on their strengths. Those deals include Switzerland's Novartis AG agreeing to buy GlaxoSmithKline's cancer-drug business for up to $16 billion, to sell most of its vaccines business to GSK for $7.1 billion, plus royalties, and to sell its animal health division to Eli Lilly and Co. of Indianapolis for about $5.4 billion. Canada's Valeant Pharmaceuticals has also made an unsolicited offer of nearly $46 billion for Botox maker Allergan, which has turned it down, so far.

Pfizer's latest offer increased the ratio of cash AstraZeneca shareholders would receive, from 33 percent to 45 percent. The latest offer would give them the equivalent of 55 pounds for each AstraZeneca share, split between 1.747 shares of the new company and 2.476 pence in cash. It said the offer represents a 45 percent premium to AstraZeneca's share price of 37.82 pounds on April 17, before rumors of the deal began circulating.

Pfizer CEO Ian Read said the proposed combination would yield "great benefits to patients and science in the UK and across the globe."

AstraZeneca has insisted Pfizer's offers significantly undervalue the company and its portfolio of experimental drugs. The company and British government officials also have raised concerns about the prospect of job cuts, facility closures and losing some of the science leadership in the U.K., where London-based AstraZeneca is the second-biggest drugmaker, behind GlaxoSmithKline PLC.

Pfizer has assured such cuts would be limited. It's promised to complete AstraZeneca's research and development hub in Cambridge. And it pledged to establish the new company's tax residence, but not headquarters, in England, which would significantly reduce its future tax rate.

But layoffs would be inevitable in such a big merger, analysts say, and Pfizer has a track record of eliminating tens of thousands of jobs as a result of megadeals.

While Pfizer is best known to the public for Viagra, cholesterol fighter Lipitor and other widely used medicines, in the pharmaceutical industry it's known for two other things: marketing muscle and mega mergers, which together have repeatedly propelled it to the top.

Since 2000, it has made three acquisitions that have vaulted the company to No. 1 in revenue. It paid $111.8 billion for Warner-Lambert Co. in 2000 to get the rights to Lipitor, then $59.8 billion for Pharmacia Corp. in 2003 and $68 billion for Wyeth in 2009, according to Dealogic. With this deal, Pfizer would then be the buyer in four of the 10 richest deals ever in the pharmaceutical industry.

Each of those deals resulted in massive layoffs and closures of some medicine factories, research facilities and office buildings, with the cost-cutting boosting Pfizer's bottom line for a few years.

Pfizer now wants to add to its medicine portfolio to boost revenue. The company slipped from No. 1 to No. 2 last year, behind Novartis AG, mainly because Lipitor got generic competition at the end of 2011, wiping out several billion dollars in annual sales. Pfizer also has sold off some units and reorganized as part of preparations to possibly break off another part of the company, something analysts have been urging it to do.

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Johnson contributed from New York.

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US cites Chinese officials in cyber-spying case

WASHINGTON — The United States brought first-of-its kind cyber-espionage charges Monday against five Chinese military officials accused of hacking into U.S. companies to gain trade secrets.

According to the indictment, hackers targeted the U.S. nuclear power, metals and solar products industries and are accused of stealing trade secrets and economic espionage. The victims are Alcoa World Alumina, Westinghouse Electric Co., Allegheny Technologies, U.S. Steel Corp., United Steelworkers Union, and SolarWorld, Attorney General Eric Holder said.

The charges underscore a longtime Obama administration goal of prosecuting state-sponsored cyber threats.

"The alleged hacking appears to have been conducted for no other reason than to advantage state-owned companies and other interests in China at the expense of businesses here in the United States," Holder told a news conference at the Justice Department. "This is a tactic that the United States government categorically denounces."

Said Bob Anderson Jr., executive assistant director of the FBI's criminal, cyber response and services division: "This is the new normal. This is what you're going to see on a recurring basis."

In a statement, China's Foreign Ministry said the U.S. charges were based on "fabricated facts" and jeopardizes China-U.S. "cooperation and mutual trust."

"China is steadfast in upholding cybersecurity," said the statement. "The Chinese government, the Chinese military and their relevant personnel have never engaged or participated in cyber theft of trade secrets. The U.S. accusation against Chinese personnel is purely ungrounded and absurd."

The charges against the Chinese military officials come on the heels of a separate worldwide operation over the weekend that resulted in the arrest of 97 people in 16 countries who are suspected of developing, distributing or using malicious software called BlackShades, Holder said. The software allows criminals to gain surreptitious control of personal computers. An announcement on those arrests was expected for later Monday in New York.

"These two cases show that we are stepping up our cyber enforcement efforts really around the globe," Holder said, adding that the U.S. will not tolerate these activities.

U.S. officials have previously asserted that China's army and China-based hackers had launched attacks on American industrial and military targets, often to steal secrets or intellectual property. China has said that it faces a major threat from hackers, and the country's military is believed to be among the biggest targets of the NSA and U.S. Cyber Command.

"It is our hope that the Chinese government will respect our criminal justice system," Holder said.

In recent months, Washington has been increasingly critical of what it describes as provocative Chinese actions in pursuit of territorial claims in disputed seas in East Asia. For its part, Beijing complains that the Obama administration's attempt to redirect its foreign policy toward Asia after a decade of war in the Middle East is emboldening China's neighbors and causing tension.

The hackers allegedly stole emails and other communications that could have helped Chinese firms learn the strategies and weaknesses of American companies involved in litigation with the Chinese government or Chinese firms.

Despite the ominous-sounding allegations, at least one of the firms downplayed the hacking.

"To our knowledge, no material information was compromised during this incident, which occurred several years ago," said Monica Orbe, Alcoa's director of corporate affairs. "Safeguarding our data is a top priority for Alcoa, and we continue to invest resources to protect our systems."

Last September, President Barack Obama discussed cybersecurity issues on the sidelines of a summit in St. Petersburg, Russia, with Chinese President Xi Jinping.

"China not only does not support hacking but also opposes it," Premier Li Keqiang said last year in a news conference when asked if China would stop hacking U.S. websites. "Let's not point fingers at each other without evidence but do more to safeguard cyber security."

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Associated Press reporters Matthew Pennington in Washington, Joe Mandak in Pittsburgh and Didi Tang in Beijing contributed to this story.

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APNewsBreak: LL Bean's CEO to step down in 2016

FREEPORT, Maine — The first non-family member to lead L.L. Bean says he's planning to step down in 2014 after more than a decade as CEO.

Chris McCormick, president and CEO, told employees in a memo that he's giving early notice so there can be a smooth transition.

During his tenure, McCormick helped to transform the 102-year-old outdoors retailer from a catalog company into a multi-channel retailer that does most of its business online. He's also sped up the opening of retail stores, with 19 stores now in operation and plans to open three more this year.

The privately held retailer is coming off its fourth year of consecutive growth.

"In this time together, we weathered the dramatic business impacts following the tragic events associated with 9/11. We also managed our way through, and even prospered (though with some sacrifices) during the deepest recession in more than half a century," he wrote. "The company has grown, is financially strong and debt free."

McCormick has been with L.L. Bean for 31 years, including 13 as president and CEO. He succeeded Leon Gorman, founder L.L. Bean's grandson. The current chairman is Bean's great-grandson, Shawn Gorman.

With more than $1.5 billion in sales last year, the company is poised for more growth.

McCormick told workers in March that L.L. Bean has been conservative for the past few years and is now ready to "accelerate our growth plans and grab market share." That plan includes pumping an additional $100 million into its website, retail expansion and business systems, he said.

The company's recent fortunes have tracked closely with booming sales of the L.L. Bean hunting shoe. The company continues to add workers at a Maine production plant to keep up with demand.

June Strohmeyer, a Denver resident visiting the flagship store for the first time, said she Monday that appreciates L.L. Bean's timeless style, customer service and durability.

And she's willing to pay for it.

"It is more expensive but I don't care. I don't like what I see at Macy's, the Gap, or Old Navy," the 62-year-old shopper said. "Those are for younger people. That's not me."

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Follow David Sharp on Twitter at https://twitter.com/David_Sharp_AP

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Day at Disneyland now $96

ANAHEIM, Calif. — The price of a ticket at Disneyland is creeping closer to triple-digits.

A single-day ticket for either Disneyland Park or Disney California Adventure Park is now $96 for those 10 and up.

The $4 hike went into effect Sunday and is about the same as previous boosts, which usually happen about once a year. Single-day ticket prices have more than doubled since 2003.

The cost for annual passes went up too.

A Disneyland statement says the price hikes were brought on by a variety of factors, but the tickets represent a great value given the breadth and quality of attractions and entertainment at the parks.

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Networks' plea to viewers: Watch now!

NEW YORK — One day into the annual week where television's biggest networks reveal their future programming plans and it was clear what the buzzword was going to be: Eventize.

No matter whether it's a word or not, broadcasters talked frequently about their desire to create big events that viewers need to watch immediately for fear of being left out of the cultural conversation.

Networks are adjusting to the changed world of how people watch their programs: hours or weeks later on DVR, online or on-demand. But the industry's financial structure hasn't caught up yet, so viewers who watch when a program is first aired — once the only way to watch — are considered more valuable.

That's why Fox is putting on a live production of "Grease" and NBC is remaking "The Music Man." Fox is recreating an Evel Knievel motorcycle jump. ABC touts its Oscars telecast and other awards shows. NBC locked up Olympics rights through 2032, and CBS won a bidding war to show NFL football on Thursday night.

Sports usually gets little or no attention in network sales pitches to advertisers. Not this year. ABC, CBS, NBC and Fox all gave sports a starring role. Why? Very few people DVR sports events.

ABC made the point explicit with a message on a wide video screen: "Your DVR can't handle live."

"We're obsessed with trying to eventize everything we can — even episodes of our scripted shows," said Robert Greenblatt, NBC's entertainment chief.

"It's about the urgency to view," said Fox's Kevin Reilly.

A grand finale won't be enough for CBS' outgoing comedy "Two and a Half Men." The network wants a season's worth of special episodes. David Letterman's retirement will be a "yearlong celebration of Dave." CBS producers have been told to push the envelope, said Nina Tassler, entertainment president, like the surprise death of Will Gardner on a March episode of "The Good Wife."

"It's important to keep your fans engaged," Tassler said. "You keep eventizing your entire season."

TRUTH SQUAD

Jimmy Kimmel is a one-man truth squad each year at ABC's schedule presentation, puncturing the promises of network salesmen, and was particularly sharp this year. He spared no one, not even his bosses, and may have effectively killed a lackluster new ABC comedy "Selfie" with a single barb.

He also zeroed in on ABC entertainment chief Paul Lee's boast that ABC was No. 1 — in brand identification or some metric. In the Nielsen ratings, ABC is No. 3.

"The ABC I work at is not No. 1," Kimmel said. "In fact, we might have to crash on your couch for a while."

He reminds advertisers the majority of new shows presented to them as surefire hits won't last more than a year. "Don't get attached to our new shows," he said. "It's like adopting a kitten with cancer."

WOMEN IN CHARGE

Women are in charge and they're tough in some upcoming shows. When a CIA agent (Katherine Heigl) promises a president (Alfre Woodard) some violent retribution for a wrong in NBC's "State of Affairs," the president replies, "That's my girl." Tea Leoni, portraying a secretary of state, takes on White House aides in CBS' "Madam Secretary." Maggie Q beats up bad guys in CBS' "Stalker," and Debra Messing is a police detective who counts to three and shoots on two on NBC's "The Mysteries of Laura."

This being television, advertisers were also shown clips of Heigl, Messing and Kate Walsh (NBC's "Bad Judge") in their underwear.

SPORTS

With the extra attention paid to sports at the broadcast networks, it was interesting to see ESPN de-emphasize fun and games. The network's presentation played up coverage of stories involving Jason Collins, Michael Sam, Donald Sterling and the Boston marathon bombing in an attempt to broaden appeal.

"Sports is our conversation, our social currency," said ESPN sales chief Ed Erhardt. "ESPN is always on at the center of culture."

SOMETHING NEW

New network shows often ape successful formulas, sometimes distressingly so. Every once in a while, an executive takes a wild swing that makes you wonder, "What's that show doing here?" They'll either succeed or fail spectacularly.

There were two this year. Composer Alan Menken works on ABC's "Galavant," a medieval musical that keeps the memory of Monty Python alive. The CW's "Jane the Virgin" is a sweet dramedy that feels completely out of place in a lineup of vampires, zombies and supernatural beings. But it had hands-down the funniest scene in all the clip reels unspooled over the past week.

COMICS

If your mom made you throw away comic books, she may have stunted a career in Hollywood. Comics were again a fertile ground for development. NBC is bringing the Hellraiser character to life in a drama. A youthful Batman is featured in "Gotham," Fox's high-profile new drama. Similarly, the CW is pinning its biggest hopes on "The Flash." ABC renewed the bubble series "Marvel's Agents of S.H.I.E.L.D." and is adding the comic drama "Marvel's Agent Carter."

QUICK QUIZ

Which of the following lines was NOT uttered at a network presentation last week:

A) "A lot of people called 'Battlestar Galactica' one of the best shows ever."

B) "This series is 'Game of Thrones' meets 'The Borgias' meets 'The Bible.'"

C) "We have two hours of bloody, sexy drama."

D) "Some of our new shows will disappear before you even realize they're on the air."

If you answered anything other than D, then you have something to learn about the atmosphere of hype and hope that accompanies this week every year.

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AP Television Writer Lynn Elber contributed to this report.

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David Bauder can be reached at dbauder@ap.org or on Twitter @dbauder. His work can be found at http://bigstory.ap.org/content/david-bauder.

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Condos becoming FHA no-lending zones

WASHINGTON -- For young first-time buyers, people with modest down payment cash, or seniors who want to tap their equity using a reverse mortgage, it's a growing problem: They cannot use Federal Housing Administration financing in condominiums.

It's not that these buyers and unit owners can't qualify on credit and income grounds for a loan personally -- they often can. Instead, it's because the entire condominium development is ineligible. As the result of policy changes at the federal level and decisions by condominium boards of directors, thousands of communities have essentially become prohibited lending zones for FHA in the past several years.

The agency has banned so-called "spot" loans and will only insure mortgages on units in condo projects that have passed a certification process that examines budgets, reserves, insurance coverage, percentage of renters compared with owners in the development and delinquencies on payment of condo fees.

FHA says that its revised procedures weed out fiscally weak, poorly managed developments and reduce taxpayer exposure to future losses. Condominium boards, on the other hand, argue that some of FHA's evaluation criteria are too strict and that the certification process is bureaucratic and costs them money they'd prefer not to spend.

Since toughening its financing rules and requiring certification of entire projects four years ago, the number of condo developments approved for FHA financing has plunged by more than half. As of mid-month, it stood at just 10,020 communities, according to an FHA spokesman. Industry sources estimate the total number of condo projects nationwide is around 144,000.

FHA financing is important because of the special niches it fills. Among the three major federal lending intermediaries -- Fannie Mae and Freddie Mac are the other two -- FHA is the most flexible on credit issues. It is also lenient on debt ratios and allows down payments as small as 3.5 percent.

As a result, FHA for decades has been the go-to mortgage option for moderate-income purchasers and has been a key resource for African-American and Latino buyers, many of whom have made their first purchase in a condominium development.

FHA also plays an outsized role in the reverse mortgage market for seniors 62 and older. Its insured reverse mortgage product accounts for more than 90 percent of all borrowing in that field, allowing seniors to extract needed cash from their home equity to support their retirement expenses.

But with the sharp decline in FHA-approved condominium projects, many buyers and unit owners are finding themselves financially frozen out. Equally troubling, unit owners who want to sell find the pool of potential buyers reduced -- along with the market value of their property -- because FHA mortgages are banned.

Seth Task of Berkshire Hathaway HomeServices Professional Realty in Solon, Ohio, says a condo unit client his firm represented recently was forced to sell for $10,000 below what she had been offered by a buyer who was pre-qualified for an FHA loan -- a loss solely attributable to the condominium's non-certified status.

Situations like this are becoming more frequent, housing industry experts say, and the lack of FHA financing eligibility for entry-level-priced condo units is partially responsible for the decline in first-time buyer participation in the real estate market.

But now a movement is getting underway to reverse this shrinkage. At this month's spring legislative conference of the National Association of Realtors here in Washington, California brokers and agents unveiled a campaign to convince condo boards to re-think their objections to FHA certification -- for their unit owners' sakes.

The primary focus, said Mike DeLeon, president of the Orange County Association of Realtors, which debuted an educational video at the Washington conference, is to show reluctant condo boards of directors "the positive benefits" of certifying with FHA. The video stresses "keeping [condo unit] values at their highest" by widening the pool of potential purchasers; helping existing unit owners tap their equities for retirement; and the relatively low risk of default presented by today's FHA buyers.

Is there a broader message here for condo boards nationwide? Maybe not so much for those in the high-priced market segments FHA rarely serves -- but even their owners are cut out of FHA's dominant reverse mortgage program.

For most other condo developments, however, the message is this: Give some thought to the issue. FHA certification has its complications and costs, but it could be more than worth the effort for your current residents and future buyers.

Ken Harney's email address is kenharney@earthlink.net.

(c) 2014, Washington Post Writers Group

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FBI: BlackShades infected half million computers

NEW YORK — More than a half million computers in more than 100 countries were infected by sophisticated malware that lets cybercriminals take over a computer and hijack its webcam, authorities said as charges were announced Monday against more than 100 people worldwide.

The FBI described its investigation in criminal complaints unsealed in Manhattan federal court against five individuals. Meanwhile, police worldwide said they had recently arrested 97 people in 16 countries suspected of using or distributing the malicious software called BlackShades.

"This case is a strong reminder that no one is safe while using the Internet," said Koen Hermans, an official representing the Netherlands in the European Union's criminal investigation coordination unit, Eurojust. "It should serve as a warning and deterrent to those involved in the manufacture and use of this software."

The FBI said the BlackShades Remote Access Tool has been sold since at least 2010 to several thousand users. The agency said one of the program's co-creators is now cooperating with the government and had provided extensive information.

The malware lets hackers steal personal information, intercept keystrokes and hijack webcams to make secret recordings of users. BlackShades also can be used to encrypt and lock a computer's data files, blocking the rightful owners from regaining access unless they pay a ransom.

Security experts have linked the program to attacks on Syrian dissidents in 2012 and attempts to steal data from more than a dozen French organizations last year. The low cost of the hacking tool has made it increasingly popular across the hacker underground, where variants have been circulating online for years.

Last year, security firm Symantec said that use of BlackShades was going up, with licenses for the program going for $40 to $100.

French officials said raids occurred last week after the FBI arrested two BlackShades developers and distributed a list of customers who had purchased the malware.

Law enforcement coordination agencies Europol and Eurojust, based in The Hague, Netherlands, said Monday that police in 13 European countries — Austria, Belgium, Britain, Croatia, Denmark, Estonia, Finland, France, Germany, Italy, Moldova, the Netherlands and Switzerland — as well as in the United States, Canada and Chile raided 359 properties and seized cash, firearms, drugs and more than 1,000 data storage devices.

The two European agencies declined to provide country-by-country breakdowns of arrests, details of items seized or the specific days when last week's raids occurred.

In Paris, the state prosecutor's office said French detectives arrested more than two dozen people during May 13 raids and described the global nature of the arrests and searches as an unprecedented "new form of judicial action." It said those arrested were identified by the FBI as French "citizens who had acquired or used this software."

In a BlackShades-related investigation before the latest global arrests, Dutch police earlier this year arrested an 18-year-old man for using the malware to take pictures of women and girls using about 2,000 computers.

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Sterling reported from Amsterdam. Associated Press writers Jamey Keaten in Paris, Raphael Satter in London and Tom Hays in New York contributed to this report.

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Stocks edge higher after drifting in early trade

U.S. stocks edged higher in early afternoon trading Monday after starting the day hovering between small gains and losses. Investors were considering the latest news on corporate mergers, including a possible combination of AT&T and DirecTV.

KEEPING SCORE: The Standard & Poor's 500 index rose six points, or 0.4 percent, to 1,884 as of 12:21 p.m. Eastern Time. The Dow Jones industrial average gained 24 points, or 0.2 percent, to 16,515. The Nasdaq composite gained 34 points, or 0.8 percent, to 4,124.

GETTING BIGGER: AT&T said late Sunday that it plans to buy satellite TV provider DirecTV for $48.5 billion. The proposed deal would create the second-largest pay TV operator behind a combined Comcast-Time Warner Cable. The proposal could face close scrutiny from the Federal Communications Commission and Department of Justice. AT&T fell 50 cents, or 1.4 percent, to $36.24. DirectTV slid 99 cents, or 1.1 percent, to $85.19.

M&A TREND: The proposed AT&T-DirecTV combination comes amid a recent increase in mergers and acquisitions, noted Terry Sandven, chief equity strategist for U.S. Bank.

"Companies in general have increased levels of cash and that bodes well for dividends, share buybacks as well as acquisitions," Sandven said. "So we view this as a sign that the environment is favorable for equities."

NO, AGAIN: The board of AstraZeneca rejected a sweetened takeover offer from U.S. drugmaker Pfizer. Pfizer, which has been courting AstraZeneca since January, announced Sunday that it was ready to raise its stock-and-cash offer by 15 percent to $118.8 billion. Pfizer rose 35 cents, or 1.2 percent, to $29.47.

DEAL BOOST: Abbott Laboratories gained 53 cents, or 1.4 percent, to $39.60 as financial analysts cheered the medical device maker's proposed acquisition of CFR Pharmaceuticals for nearly $3 billion.

UNAPPETIZING RESULTS: Campbell Soup fell $1.13, or 2.5 percent, to $43.99 after the food company reported earnings that fell short of Wall Street estimates. The company also lowered its full-year revenue outlook, noting that it was disappointed that soup sales failed to meet expectations.

SECTOR WATCH: Seven of the 10 industry sectors in the S&P 500 were trading higher, led by materials and technology stocks. Travel reviews portal TripAdvisor topped all stocks in the S&P 500, gaining $3.56, or 4.3 percent, to $85.72. Retailer Nordstrom posted the biggest decline, falling $2.17, or 3.1 percent, to $68.38.

OTHER MARKETS: Bond prices were little changed. The yield on the 10-year U.S. Treasury note held steady at 2.52 percent. Gold rose $2.60 to $1,296 an ounce. Crude oil rose 73 cents to $102.30 a barrel.

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Former NY Times editor: Leading newsroom was honor

WINSTON-SALEM, N.C. — In her first public appearance since her dismissal from The New York Times, former executive editor Jill Abramson compared herself to a new college graduate: "scared but also a little excited."

"What's next for me? I don't know. So I'm in exactly the same boat as many of you," Abramson told the Class of 2014 at Wake Forest University's graduation ceremony on Monday, to laughs and applause.

The Times announced last week that Abramson was being replaced by managing editor Dean Baquet. Publisher Arthur Sulzberger Jr. has denied reports that Abramson's dismissal had to do with complaints over unequal pay or the company's treatment of women. Instead, he cited Abramson's newsroom management style.

In her speech, Abramson focused on a theme of resilience, talking briefly about her time at the helm of The New York Times but not directly addressing her dismissal. She said that she didn't want the "media circus" following her to take attention away from the graduates.

"It was the honor of my life to lead the newsroom," she said, describing the risks Times journalists take to report the news.

"Sure, losing a job you love hurts, but the work I revere — journalism that holds powerful institutions and people accountable — is what makes our democracy so resilient. This is the work I will remain very much a part of."

Abramson decided not to attend Brandeis University's weekend graduation, where she was supposed to receive an honorary degree. But she went ahead with the speech at Wake Forest. Abramson said students there had asked whether she would remove her tattoo of The Times' 'T.'

"Not a chance!" she said.

Among her journalism heroes, Abramson listed former New York Times reporter Nan Robertson, who wrote a book describing the fight for workplace parity by the newspaper's female employees, and former Washington Post publisher Katharine Graham.

"They faced discrimination in a much tougher, more male-dominated newspaper industry. And they went on to win Pulitzer Prizes," Abramson said.

Abramson also invoked the memory of her father, who told her it was more important to deal with setbacks than successes.

"'Show what you are made of,' he would say. Graduating from Wake Forest means all of you have experienced success already. And some of you — and now I'm talking to anyone who's been dumped, not gotten the job you really wanted, or received those horrible rejection letters from grad school — you know the sting of losing or not getting something you badly want. When that happens, show what you are made of."

Later, Abramson shook the hands of all 1,059 undergraduates as they crossed the stage. Wake Forest officials said she left immediately after the ceremony, and she did not take questions from reporters.

Graduate Georgia Tanner, 22, said Abramson handled her speech well, addressing the recent new but not dwelling or sounding bitter. "I think it was a professional address," Tanner said.

Graduate Sathay Williams, 20, said Abramson made the speech about the graduates and focused on something they can use in the future.

"Life can throw curve balls at you," Williams said. "Sometimes it's not fair, sometimes it's not deserved. You can work really hard and still things don't work out. But keep chugging forward, stay true to who you are and go forward with it. She gave us a really good message."

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