Macy’s and Martha Stewart Living Reach Settlement

NEW YORK — Macy's and Martha Stewart Living Omnimedia say they have settled a breach-of-contract lawsuit involving J.C. Penney.

But Macy's said the settlement does not impact its lawsuit against J.C. Penney Co., which is still ongoing.

Macy's Inc. and Martha Stewart Living Omnimedia Inc. said Thursday that their settlement terms are confidential and not material to their businesses. Both companies said that they look forward to "a continued, successful partnership together."

Macy's has had an exclusive merchandising contract with Martha Stewart since 2006, including items like bedding and bath products.

Stewart's company and Penney signed a merchandising deal in December 2011 to develop mini Martha Stewart shops. That prompted Macy's to sue both companies for violating its exclusive agreement with Martha Stewart.

Martha Stewart Living Omnimedia and J.C. Penney have already scaled back their partnership. In October the department store chain said it would no longer sell a broad range of home and bath products designed by Martha Stewart Living Omnimedia but would continue to sell a smaller batch of Martha Stewart items, including window treatments, rugs and party supplies.

Martha Stewart is looking to boost merchandising sales as it continues to grapple with a weak publishing business amid sluggish advertising sales. In October it said its quarterly net loss narrowed, though revenue fell 22 percent to $33.8 million, hurt by weakness in its broadcasting and publishing divisions.

Macy's, meanwhile, has been seeing strong sales. In November it said quarterly net income rose 22 percent will revenue rose 3 percent to $6.28 billion.

J.C. Penney spokeswoman Daphne Avila said the company had no comment on the Macy's settlement with Martha Stewart Living Omnimedia.

In morning trading Thursday, Macy's shares rose 40 cents to $53.80, Martha Stewart Living Omnimedia rose 19 cents to $4.39 and J.C. Penney slipped 11 cents to $9.04.

DealBook: A Stock Exchange Expands Its Global Reach

Simon & Schuster and Barnes & Noble Reach a Deal

Beyond a certain point, retribution shades into vengeance.

The theory of evolution, if it is to explain the existence of conscious life, must become more than a physical theory.

Unable to Reach Deal, Europe Plans New Talks on Bank Rescues

“We ran out of time,” Michael Noonan, the Irish finance minister, told reporters as he left the meeting here. “There are still core issues outstanding, so we’ll need a full meeting next week, and there’s no guarantee it will reach conclusion.”

Diplomats said the next attempt to reach a deal was scheduled for Wednesday — a day before the leaders of the European Union’s 27 member states gather for a summit Brussels, their last scheduled meeting before the summer. The leaders had been expected to endorse the finance ministers’ decision.

The failure to reach a deal could further unsettle investors who were already jittery about the lingering recession in the euro zone, turbulence on global markets, renewed political instability in Greece, and hints that Cypriot leaders were balking at their bailout agreement. 

The marathon effort, involving 18 hours of talks beginning Friday morning, was aimed at breaking the so-called doom loop, in which struggling governments take their states deeper into debt to save their banking systems, only to face sky-high sovereign borrowing costs.

The rules would specify the order in which investors and creditors have to absorb losses so taxpayers do not have to bear the burden.

A deal could also help prevent a recurrence of the chaos that ensued during a bailout for Cyprus in March, when governments and international lenders argued over how to impose losses on investors in the country’s troubled banks.

The tools would become important building blocks in the future for a possible banking union, which includes a single supervisor under the European Central Bank overseeing about 150 of the bloc’s largest lenders. It is supposed to go into force in the middle of next year.

A day earlier, as part of the effort to address the banking issue, the 17 ministers from the euro area agreed to allow a rescue fund, the European Stability Mechanism, or E.S.M., to pump money directly into failing banks during the second half of next year.

But on the second day of talks, as ministers from the 10 remaining non-euro countries in the European Union joined the meeting, there was a deadlock over how to stop disorderly bank bailouts from turning into national fiascos.

One of the most sensitive issues was a divide between countries using the euro, and those remaining outside the single currency, was where losses should fall when banks fail, said Mr. Noonan. “Those countries which aren’t in the euro need greater flexibility because they haven’t access” to the shared rescue fund.

France and Germany, which are both members of the euro group of countries, were also divided on that issue. France sought more leeway to access the shared European mechanism while Germany resisted, said diplomats who spoke on condition of anonymity.

The German stance, which was shared by the Dutch, underlined how some northern European countries want to ensure that bank bailouts remain a national responsibility as much as possible, and how they remain determined to resist creating a lender of last resort that could expose them to losses incurred by other parts of the bloc.

For much of the day, ministers were divided over how, and whether, to allow countries discretion to protect certain classes of creditors.

The worry among some countries like Britain was that automatic losses for some creditors could set off fears of losses at other institutions, which could start bank runs. But countries like Spain wanted to ensure that bank investors do not flee to more prosperous countries like Germany, where mechanisms for resolving bank problems might be better capitalized and could be used to shield creditors from losses.

A proposal put forward by the Irish delegation during the negotiations would have given countries the flexibility to choose where losses would fall, as long as 8 percent of a failing bank’s total liabilities were wiped out first.

But that proposal failed to gain sufficient traction. Sweden protested that the figure was too high. The Dutch and the Germans said the Irish figure was too low, and they complained it still could induce risky behavior if bankers were overly confident of relying on mechanisms like national bailout funds to come to their rescue.

Advertising: Courting Thrifty Consumers With Value and Quality Brands Stress Value and Quality to Reach Thrifty Consumers

Many on Madison Avenue are deciding to focus on value, as in value for money, celebrating thriftiness as they did during the dark days of 2008 and 2009 but also, in an effort to keep ads from growing stale, suggesting that product attributes like quality matter, too, in a “you get what you pay for” fashion.

For example, advertising to be introduced on Monday by Vonage, the Internet phone provider, replaces its usual message of lower prices, expressed by exhortations like “Ditch the big bill,” with a theme, “Crazy generous,” voiced by a brand character styled as the company’s new chief generosity officer. “What we need is a company that connects us with generosity,” the character says in a commercial by JWT, part of WPP.

The new theme is “bigger than just saving money,” said Barbara Goodstein, chief marketing officer at Vonage Holdings in Holmdel, N.J.

“We believe people should have the opportunity to find value in technology,” she added, listing elements that, in addition to low cost, include “flexibility, simplicity, quality, new products and innovation.”

The “Crazy generous” theme is meant to convey that Vonage remains “committed to providing consumers with low-cost communications services,” Ms. Goodstein said, as part of “a business philosophy” embodied by the brand character.

“He is a champion of the people,” she added, in a populist way, which makes him “the right spokesperson for our times.”

Procter & Gamble, the nation’s largest advertiser by spending, has been scrambling to fine-tune its lineup of mostly premium-price household staples in categories like beauty, detergents and paper goods. The goal is to add lower-price items to appeal to shoppers who have been switching brands to save money but still seek efficacy from what they buy, while not eroding sales for the company’s higher-price merchandise.

The recent abrupt departure of the Procter & Gamble chief executive, Robert A. McDonald, who was succeeded by his predecessor, A. G. Lafley, was attributed partly to concerns the effort was hitting too many bumpy patches.

One example of how Procter has sought to adapt to the times was the return in January of Vidal Sassoon hair products, discontinued in North America in 2003, as what the company called the “affordable” Vidal Sassoon Pro Series line — i.e., priced lower than the company’s Pantene brand name hair products, but higher than store brands.

This June, Procter & Gamble plans to introduce Iams So Good, a dog food that will cost about 15 percent less than the Iams line, which is among the higher-price dog foods like Eukanuba and Hill’s. Iams So Good, aimed at brands like Beneful and Pedigree, is being introduced with advertising by the creative agency for Iams, Saatchi & Saatchi in New York, part of the Publicis Groupe, that includes commercials, print and online ads, displays in stores and content in social media. The budget for the Iams So Good campaign, which echoes the Iams brand’s ad theme, “Keep love strong,” is estimated at more than $50 million.

Making Iams “more accessible” is “a big move for us,” said Kristine Decker, marketing director for North America at the Procter & Gamble pet care division in Cincinnati.

“We’re broadening our appeal,” she added, because “we realize a lot of our brands need to ‘tier down’ to appeal to more consumers.” She compared adding Iams So Good as part of the Iams line to the way the company added lower-price Bounty Basic and Charmin Basic products to the premium-price Bounty and Charmin lines of paper goods.

As Iams So Good arrives in stores, Procter intends to “support regular Iams, too,” Ms. Decker said, because “we’ve got to build the base as we expand.” According to Kantar Media, a division of WPP, Procter spent $69.9 million to advertise Iams last year in major media, compared with $67.4 million in 2011. That could help deter defections to Iams So Good by buyers of Iams.

The campaign for Iams So Good promotes the absence of ingredients like added sugar, dyes and artificial preservatives and proclaims that the new variety “has 100 percent wholesome ingredients and nothing else.” The product’s lower cost will be conveyed through the store displays and packaging rather than brought up in commercials or print ads.

“We don’t talk about the value or the price,” said Tris Gates-Bonarius, global creative director on the Iams and Eukanuba brands at Saatchi & Saatchi, so “the look and feel of the campaign” can be in “the Iams tone of voice, celebrating authentic, real relationships between pets and owners.” For instance, she added, the commercials for Iams So Good will feature pets, rather than trained animals, that appear with their owners, just as commercials for Iams do. One spot for Iams So Good depicts a dog named Harvey performing what is described as his “ ‘I’m happy you’re home’ dance.”

Ms. Decker echoed Ms. Gates-Bonarius. “Our first priority is to create awareness of what’s in your dog’s bowl,” Ms. Decker said of the campaign’s emphasis on the ingredients in Iams So Good. “We will drive more overt value awareness in stores.”

DealBook: Philip Falcone, Hedge Fund Manager, and S.E.C. Reach Deal

Steve Marcus/ReutersPhilip Falcone, chief of the hedge fund Harbinger Capital Partners.

12:24 a.m. | Updated

When federal regulators sued the high-flying money manager Philip A. Falcone last summer, they claimed his actions “read like the final exam in a graduate school course in how to operate a hedge fund unlawfully.”

By Thursday, the agency appeared to be softening its tone.

Nearly a year after the Securities and Exchange Commission accused him of manipulating the market, using hedge fund assets to pay his own taxes and “secretly” favoring select customers at the expense of others, Mr. Falcone disclosed in a public filing that he had “reached an agreement in principle” to settle the two cases with the agency. The S.E.C. also struck a deal with Harbinger Capital Partners, Mr. Falcone’s flagship hedge fund.

The settlement, which came after a federal judge in New York questioned aspects of the cases, would be a moral victory of sorts for Mr. Falcone, who has stubbornly resisted a deal for more than a year. It might also reignite concerns that the S.E.C.’s results sometimes fall short of its ambitions.

The S.E.C.’s punishment of Mr. Falcone appeared steep, if only because it spelled an end to his long career as a hedge fund wizard. Mr. Falcone, who made a fortune betting against the subprime mortgage market in 2007, has agreed to at least a two-year ban from raising new capital, a death knell for a hedge fund manager. He must also “take all actions reasonably necessary to expeditiously” return money to investors who are fleeing the fund, according to the public filing on Thursday.

But with the exodus of capital, and a wireless venture that he bankrolled in bankruptcy, Mr. Falcone’s hedge fund was already resigned to its fate. And the fine print of the S.E.C. deal suggests that Mr. Falcone, who is not required to admit or deny the agency’s accusations, could escape relatively unscathed.

“The settlement, itself, would change very little in Falcone’s life,” said Erik Gordon, a professor of law and of business at the University of Michigan.

For one, the deal comes with an $18 million penalty from the S.E.C. — a rounding error to a hedge fund billionaire. Mr. Falcone will personally pay $4 million of the penalty, according to people briefed on the matter, while the fund’s management company will pay the rest. One of the people briefed on the matter noted that $18 million was higher than what Mr. Falcone initially offered to pay and was a substantial sum given that the hedge fund’s investors did not suffer any financial harm.

Still, the two-year ban comes with a loophole. According to the people briefed on the matter, the ban does not apply to the nine investment advisers that Mr. Falcone runs through Harbinger Capital. The S.E.C. granted the carve-out, the people said, so Mr. Falcone could unwind the hedge fund without harming investors by selling off pieces at fire-sale prices.

More important, perhaps, Mr. Falcone can retain his control of the Harbinger Group, a publicly traded conglomerate that he uses to make a broad array of investments. In recent years, Mr. Falcone has started to emerge as something of a private equity investor, taking varied stakes in the insurance business and consumer goods industry, including the company that produces the George Foreman grill. That business remains largely unaffected by the S.E.C. deal.

The settlement, the people said, is also notable for something that it did not include: a common provision that prohibits defendants from committing future violations with fraudulent intent.

The lack of a so-called fraud injunction, an unusual victory for the target of an S.E.C. action, is a reminder of broader concerns about the toughness of the agency. During the tenure of Robert Khuzami, the former enforcement chief of the S.E.C. who filed major cases against Wall Street firms, the agency came under scrutiny for not leveling bigger fines. He notably butted heads with a federal judge in New York, Jed S. Rakoff, who in 2010 called the agency’s $150 million settlement with Bank of America over lax public disclosures “half-baked justice at best.”

Now that the S.E.C. is in transition under a new chairwoman, Mary Jo White, the agency is vowing once again to strike a hard line against financial fraud.

An S.E.C. spokesman declined to discuss the terms of the settlement with Mr. Falcone, given that approval of the agency’s commissioners is still required. Mr. Falcone’s lawyer, Matthew S. Dontzin, also declined to comment.

The settlement emerged after earlier attempts at a deal came up short. Mr. Falcone, the people briefed on the matter said, refused to settle last year as long as the S.E.C. insisted on applying an injunction against fraud, which would amount to something of a rebuke. In June, the S.E.C. held its ground, deciding to file its cases instead.

But then the S.E.C. received a warning sign from Judge Paul Crotty, who at a hearing in February declared that in one part of a case: “I’m having difficulty seeing exactly where the wrong occurred here.”

Settlement talks, the people said, resumed just days later. This time, Mr. Falcone was willing to pay a larger sum. And the S.E.C. agreed to drop its bid to impose the fraud injunction. Agency officials, the people briefed on the matter said, decided that a fraud injunction in this case would be redundant. Mr. Falcone, the people said, will still have to settle charges that he committed fraud, and is prohibited from breaking the law.

The S.E.C. also decided to impose an independent monitor on the firm. But the agency agreed to pick the monitor, the people said, from a list of five people Mr. Falcone recommended.

“It appears to be a pragmatic resolution of a matter in which the judge expressed some doubt about the S.E.C.’s charges,” said Stephen J. Crimmins, a partner at the law firm K&L Gates and a former enforcement official at the S.E.C.

For Mr. Falcone, the deal could close a painful chapter in his long Wall Street career.

There was a time when Mr. Falcone, who made his way from rural Minnesota to the Harvard hockey team, was seen as one of the savviest investors on Wall Street. His prescient bet against subprime mortgages made him the envy of the hedge fund world and led Harbinger’s assets to soar near the top of the industry.

The success also thrust him and his wife, Lisa Maria, into the ranks of New York’s moneyed elite. Their charitable donations, like a $10 million gift to the High Line in Manhattan, were overshadowed only by a flashy taste for fashion and real estate that made them the subject of tabloid fascination.

But Mr. Falcone’s fortunes tumbled last year. A bet on LightSquared, an upstart wireless venture he sought to build from scratch, soured as the government blocked his effort to build a 4G network. A year ago, the company filed for bankruptcy, dealing a blow to Mr. Falcone, who once owned 96 percent of LightSquared’s shares.

Then the S.E.C. came bearing down on him. In June, after settlement talks broke down, the agency filed two sets of civil fraud charges against Mr. Falcone.

In one case, it accused Mr. Falcone of cornering the market in a particular category of bonds. In a separate action, the S.E.C. accused Mr. Falcone of allowing three unidentified banks and investment firms — Goldman Sachs, HSBC and Paamco, according to people briefed on the matter — to withdraw money from his hedge fund when others could not.

The S.E.C. also took aim at Mr. Falcone for taking a $113.2 million loan from his fund to pay his own tax bill in 2009. He borrowed the money, the S.E.C. said, at a time when the fund had blocked investor redemptions and then kept the deal secret for five months.

The accusations led to an unsparing critique from the S.E.C.

“Not only are hedge fund managers expected to be savvy investors, they are supposed to serve the interests of their clients,” Bruce Karpati, head of the S.E.C.’s asset management unit, said at the time. Mr. Karpati, who announced his departure from the agency on Thursday, then added: “Here, in addition to raiding a fund for personal benefit and cutting secret deals with favored investors, Falcone then lied to investors about what he had done.”

DealBook: Bondholders and Mexico Glass Maker Reach Deal

Steve Marcus/ReutersPaul Singer, chief of the hedge fund Elliott Management.

MEXICO CITY — The giant Monterrey glassmaker Vitro said Monday that it had reached an agreement with bondholders, ending a dispute among powerful financiers that had ricocheted between Mexican and American courts.

Under the agreement, Fintech, which is owned by the Monterrey-born investor David Martinez, will buy the bonds held by a group of hedge funds and pay additional cash to cover legal fees. In return, Fintech will receive a 13 percent stake in a Vitro subsidiary and a $235 million note issued by the subsidiary.

Bondholders will receive 85.25 cents on the dollar for their bonds, according to the agreement. The company said that Fintech would buy a “substantial majority” of the $729 million in bonds that are in dispute.

The legal fight had produced ripple effects in the emerging debt markets. For example, Cemex, one of the world’s largest building materials companies, was forced to sign a “Vitro clause” when it issued debt last year. Cemex, with a reputation for strong corporate governance and a company that is also based in Monterrey, Mexico’s industrial heartland, promised debtors that it would not grant subsidiaries or related-party creditors the same rights as bondholders.

“Ever since Vitro came out with this cockamamie scheme,” there has been uncertainty about bankruptcy proceedings in Mexico, said Arturo C. Porzecanski, economist in residence at American University’s School of International Service.

The Vitro bondholders had been fighting the company in United States courts, arguing that Vitro borrowed money from its subsidiaries, turning them into new creditors who then outvoted bondholders on a plan to restructure $1.2 billion in defaulted debt.

A Monterrey court approved the plan in February 2012, where bondholders who agreed to the new financial plan received almost 69 cents on the dollar for their debt, according to James V. Harper, the head of research at BCP Securities in Greenwich, Conn.

But several giant hedge funds, including Elliott Management and Aurelius Capital Management, held out. Elliott Management is run by Paul E. Singer, who has made a career out of extracting payments from debtors that have defaulted.

Instead, the funds asked American courts to reject the Mexican bankruptcy plan, calling it “a testimony to audacity, brazen manipulation and greed.”

Last June, Judge Harlin DeWayne of the Federal Bankruptcy Court in Dallas refused to apply the Mexican bankruptcy plan in the United States. A federal appeals court upheld the judge’s decision in November.

Mr. Harper said those decisions removed any legal bankruptcy protection for Vitro in the United States and forced it to negotiate. “I think they were surprised when they didn’t get it,” he said. “I don’t think they counted on such aggressive opposition.”

Without protection, Vitro might have faced collection efforts on its sales in the United States, which amounted to $446 million last year.

It is rare for an American judge to refuse to enforce another country’s bankruptcy law in the United States, Mr. Harper said. “That was a substantial setback for Vitro and a substantial victory for the holdouts.”

Noting that the Mexican government had filed a brief in support of Vitro, Mr. Porzecanski, the economist, said, “The fact that the workout process was not recognized in the United States leaves Mexico with a black eye.”

Under the agreement announced Monday, Vitro and the bondholders agreed to drop all legal disputes.

“These agreements allow us to close the book on a challenging period for our company, and focus entirely on our business and meeting our customers’ needs,” said Vitro’s chairman, Adrián G. Sada.

It was Fintech’s owner, Mr. Martinez, who helped Vitro put together a plan to revamp its finances. Mr. Martinez remains a mystery, despite being known as a collector of art and owner of one of the most expensive apartments in Manhattan, atop the Time Warner Center.

“Fintech’s participation was crucial in order to establish the foundation for the agreements we have reached,” Claudio Del Valle, Vitro’s chief restructuring officer, said in a statement.

Sovereign Bank, Land Developer Reach Accord in Bankruptcy Discovery Dispute

On the eve of a hearing to determine monetary sanctions, Sovereign Bank settled the underlying discovery-abuse claims with property developer 400 Walnut Associates, which is going through Chapter 11 bankruptcy.

Media Decoder Blog: Arbitron Deal Extends Nielsen's Reach Into Consumer Habits

With its $1.26 billion acquisition of Arbitron, announced on Tuesday, Nielsen is buying much more than the most widely followed radio ratings service. It is also extending its already substantial reach into the overlapping forms of media through which people consume their entertainment and news, and spend their money — information that is essential to advertisers.

Nielsen is best known for its television ratings, but its various branches also track an array of consumer product sales, like books and music, as well as consumers’ habits online and through their mobile devices. Just on Monday, for example, Nielsen announced a new system with Twitter to rank TV shows by their levels of social-media chatter.

Arbitron, meanwhile, has remained primarily focused on radio consumption, which has held surprisingly strong in the Internet age as people stay plugged in to their favorite radio stations, particularly while driving.

According to Arbitron’s most recent statistics, more than 241 million people in the United States, or about 92 percent of the population ages 12 and over, listen to the radio each week. And unlike television, the vast majority of the ads on broadcast radio are for local businesses.

Through the deal with Arbitron, Nielsen should be able to track even more of consumers’ media consumption and buying habits. In a presentation to investors and Wall Street analysts, Nielsen said that by adding Arbitron’s radio data to its portfolio, it would be able to increase the total amount of time in a given day it could track the listening and viewing habits of the average American to seven hours from the current five.

“That is a very big deal when your job is to measure how consumers ultimately form and change behaviors,” David L. Calhoun, Nielsen’s chief executive, said in a conference call. “And it’s that linkage of buy and watch that ultimately allows us to provide those insights.”

In early trading, Arbitron’s shares shot up by nearly 24 percent, reflecting the premium Nielsen will pay for the shares; Nielsen’s stock was up about 1.3 percent. Nielsen is active in more than 100 countries and last year had $5.5 billion in revenue. Arbitron is a much smaller company, but has substantial profit margins; last year it generated $53 million in net income on $422 million in revenue.

As some analysts see it, the challenges for the combined companies will include measuring the growth of online audio and linking Arbitron’s value for local advertising with Nielsen’s more extensive and national data.

For now, Internet radio services like Pandora are not measured by Arbitron in “apples to apples” terms alongside broadcast radio stations, which Pandora has complained puts them at a disadvantage with advertisers and media-buying agencies. But those measurements may become essential as online listening grows and is embraced by even the biggest radio broadcasters, like Clear Channel Communications.

Laura Martin, an entertainment and media analyst with Needham & Company, said that Nielsen’s expertise and its aggressive push into online markets could be an advantage in exploiting Arbitron’s local radio data.

“It’s interesting that they will have the management I.Q. of Nielsen in charge of local advertising possibilities,” Ms. Martin said. “The Internet is moving at the speed of light, and the next big promise of advertising cash is sitting in local. In Nielsen’s hands those relationships may turn into something that Arbitron didn’t think of.”

Ben Sisario writes about the music industry. Follow @sisario on Twitter.

Deal on Aid to Greece Is Within Reach, Germans Say

Chancellor Angela Merkel of Germany said she thought that an agreement on a solution could be reached next week.

“One doesn’t know for sure, but there are chances to get a solution on Monday,” when the next meeting of euro zone ministers is scheduled, Ms. Merkel said in the German Parliament.

Ms. Merkel added, “We want Greece to remain in Europe.”

Wolfgang Schäuble, the German finance minister, said he was confident that an agreement could be reached once “technical questions” had been clarified.

Euro zone finance ministers and international officials ended their latest meeting on Greece early Wednesday after failing to reach a breakthrough on Greek aid despite nearly 12 hours of intensive closed-door talks.

It was the second consecutive week they reached such an impasse, highlighting deep divisions on how to find the money to keep the Greek economy afloat and prevent contagion in the euro zone even as the country’s debt prospects worsen.

Greece is seeking to unlock a 31.5 billion euro, or $40.4 billion, installment of loans from an international bailout program.

If ministers do reach a deal, Greece is likely to get a larger amount of about 44 billion euros because two additional installments are due by the end of the year under the program. The current program, worth 130 billion euros, has been frozen since June, when creditors determined that Greece was failing to meet the conditions of the bailout.

While there is little immediate threat that creditors will deny further aid to Athens, finding a formula to turn the spigot back on has proved incredibly difficult, particularly for Germany, where Ms. Merkel is seeking to avoid announcing losses on German loans or big new financing commitments to Greece ahead of her re-election campaign next year.

That has left the euro zone’s leadership and officials from the International Monetary Fund attending a seemingly endless series of late-night meetings.

“The fund knows they can’t push the big creditor nations like Germany to cough up enough money for a systemic fix for Greece given the German election cycle and because such a fix also would meet strong opposition from powerful parliamentary committees in countries like Finland,” said Mujtaba Rahman, a Europe analyst at the Eurasia Group. “So instead, the fund is pushing creditor nations like Germany as far as possible on everything else. The fund wants to be as aggressive as it can be without actually demanding creditor nations take haircuts on their loans.”

On Tuesday night, ministers examined options, including lowering interest rates on Greek debt, lengthening the deadlines for repayments and allowing Greece to buy back its bonds at a steep discount.

Once lenders agree on a solution for Greece, the measure will still have to be debated and passed by German lawmakers. Mr. Schäuble said on Monday that the German Parliament could put the issue to a vote by the end of next week if an agreement was reached Monday.

But the holdup immediately prompted the Greek prime minister, Antonis Samaras, to insist that Athens had already carried out promised reforms and should receive its bailout money.

“Greece did what it had to do and what it had pledged to do,” Mr. Samaras said. “Our partners, and the I.M.F., must now assume their responsibilities.”

“Whatever the technical difficulties involved in finding a solution, they do not justify any negligence or delay,” said Mr. Samaras.

The holdup also prompted renewed criticism of Mr. Samaras and of Greece’s foreign bailout by Alexis Tsipras, the leader of the leftist opposition party Syriza, which is leading in opinion polls.

“Samaras has become an integral part of the pre-election campaign of Ms. Merkel, who does not want to admit to the German people before German elections that she has made serious mistakes, that she is to blame for the oncoming recession and that a haircut is necessary for Greece’s debt,” Mr. Tsipras said in a statement.

The meeting broke up on Wednesday morning with Greece’s biggest creditors like Germany at loggerheads with the I.M.F. over how much extra financing to provide in the next four years, and over whether Greece’s towering debt must be reduced to 120 percent of gross domestic product by the end of the decade.

Christine Lagarde, the I.M.F.’s managing director, had insisted that financing Greece to 2016 would help it make its debt manageable by the end of the decade.

But a number of member states resisted that suggestion, insisting on limiting questions to how to finance Greece through 2014. Using a target date of 2014 would cost less, or about 15 billion euros, but that would leave questions unresolved about the country’s financing.

Melissa Eddy contributed reporting from Berlin and Niki Kitsantonis from Athens.

Samsung Expected to Reach End of Record Run

SEOUL — Samsung Electronics reported a record quarterly profit of 8.1 trillion South Korean won, nearly double the figure of last year, as strong sales of high-end televisions and Galaxy smartphones more than offset reduced orders for chips and screens from Apple, its main rival and leading customer.

Most analysts, however, expect a run of four record quarters — the most recent worth $7.3 billion — to end in December, as the South Korean group, one of the world’s leading makers of smartphones, televisions and memory chips, increases its marketing, countering the new Apple iPhone 5 and other products in a crowded smartphone market, valued at $200 billion globally.

Credit Suisse Group, an international financial services company, estimated that Samsung might have spent about $2.7 billion on marketing in July to September alone during the Olympic Games in London and on Galaxy promotions.

The expected record profit of 28 trillion won would mean higher payouts for performance to many of Samsung’s 206,000 staff members early next year. And Samsung may have to set money aside this quarter if it fails to overturn an appeal of a U.S. court verdict that awarded more than $1 billion in damages to Apple on Aug. 24 for patent infringements by Samsung.

“Fourth-quarter profit will be pressured by one-off expenses: performance payouts and some $1 billion in legal provisioning relating to the Apple litigation,” said Lee Sun-tae, an analyst at NH Investment & Securities.

“Excluding those, core earnings will remain solid, and a swing factor is how much Samsung spends on marketing.”

Analysts expect earnings to decline until the second quarter of next year as a slump in computer sales and a weak global economy sap demand for chips and electronics products.

“The biggest risk for Samsung is competitive product lineups from its rivals, such as the iPhone 5,” said Byun Han-joon, an analyst at KB Investment & Securities.

“Because handsets drive most of its profits, one misstep in handsets could result in losses for the whole Samsung group,” Mr. Byun said.

Profit at Samsung’s mobile division is likely to have more than doubled in the July-to-September period to about 5 trillion won as smartphone shipments topped 58 million, including as many as 20 million of the Galaxy S III.

Ahead of full quarterly results due Oct. 26, Samsung estimated that its July to September operating profit jumped to 8.1 trillion won from a year ago, beating an average forecast of 7.6 trillion won in a survey of analysts.

Strong handset sales made up for reduced profits from its chip business. Prices of dynamic random access memory, or DRAM, chips — used in computers and mobile phones — dropped 14 percent in the September quarter. Such chips now trade below what it costs most contract manufacturers to make them and will squeeze near-term earnings, analysts say. Tablets and smartphones, the real growth areas, use far smaller memory storage.

Samsung is expected to invest less in chips next year because of the drop in demand, which could be bad news for equipment manufacturers. Kwon Oh-hyun, who became chief executive of Samsung in June, said late last month that the group had yet to complete its 2013 investment plans.

Samsung is strengthening its product lineup, with its latest phone-tablet, the Galaxy Note, expected to go on sale in the United States this month; its ATIV smartphones, which run on Microsoft’s new Windows system, will compete with Nokia’s Lumia series.