the-statement-

Microsoft Sells $1.15 Billion of Convertible Notes to Extend Debt Maturity

by on June 8, 2010

By Sarah McDonald June 9 (Bloomberg) — Microsoft Corp. , the world’s biggest software maker, said it sold $1.15 billion of convertible senior notes due 2013 as it seeks to replace short-term borrowings with longer-dated debt. The bonds, which don’t pay interest, can be handed over for shares when Microsoft stock rises to $33.40, a 33 percent increase from its last reported price of $25.11 on June 8, according to a statement distributed by PR Newswire today. Microsoft may also choose to exchange the notes for cash in certain circumstances, the statement said. “Microsoft will use the net proceeds from the offering of convertible notes to repay short-term debt,” the Redmond, Washington-based company said in the statement. Microsoft had $2.25 billion of short-term debt outstanding as of March 31, according to a filing with the U.S. Securities and Exchange Commission. The convertible notes give the company more stability with debt at a fixed rate, compared with the more volatile interest of short-term paper. Convertible bonds allow investors to exchange debt into common stock at a pre- established rate under specified conditions. Microsoft gave underwriters an option to buy an additional $100 million of the notes, according to the statement. Prior to March 15, 2013, the convertible notes will be convertible, only in certain circumstances, into cash and, if applicable, cash, shares of Microsoft’s common stock or a combination thereof, at Microsoft’s election, the statement said. On or after March 15, 2013, the convertible notes will be convertible at any time, it said. The software maker issued $3.75 billion of 5-, 10- and 30- year debt in May 2009 as it tapped the corporate bond market for the first time, according to data compiled by Bloomberg. To contact the reporter on this story: Sarah McDonald in Sydney at smcdonald23@bloomberg.net .

More:
Microsoft Sells $1.15 Billion of Convertible Notes to Extend Debt Maturity

Tagged as: , , , , , , , , , , , , , ,

{ 0 comments }

Volcanic Ash Cloud Drifting Over Spain, Portugal, Irish Air Authority Says

by on May 8, 2010

By Mike Harrison May 8 (Bloomberg) — Irish airspace and airports continue to be clear of volcanic ash originating from Iceland, the aviation authority said today in a statement on its website. “However, the ash cloud situated over the North Atlantic is drifting in over the Iberian Peninsula, and other parts of southern Europe, with a consequential risk to flight in those areas,” the statement said. “Irish Airports are expected to be open until at least midnight tonight. However, North Atlantic flights and flights to and from Southern Europe may be impacted over the weekend. Airspace over Northern Scotland may also be at risk later today. ‘’

Read the rest here:
Volcanic Ash Cloud Drifting Over Spain, Portugal, Irish Air Authority Says

Tagged as: , , , , , , , , , , , , , ,

{ 0 comments }

Emerging-Market Bond Funds Take In $10.4 Billion, Surpass 2005 Record High

April 15, 2010

By Lilian Karunungan and Garfield Reynolds April 16 (Bloomberg) — Emerging-market bond funds received an unprecedented $1.8 billion in the past week, lifting 2010 inflows to a record, on speculation central banks will raise interest rates, according to EPFR Global. Year-to-date investments in debt of developing nations reached $10.4 billion, exceeding the all-time high in 2005, the Massachusetts-based research company said in an e-mailed statement. Inflows into U.S. floating-rate bonds were also a record in the week ended April 14 as investors withdrew money from stock funds on the outlook for higher borrowing costs. “Investors are bracing for higher prices and interest rates,” Cameron Brandt , senior analyst at EPFR, wrote in the statement dated yesterday. He highlighted interest in higher- yielding emerging market debt, purchases of bonds with adjustable rates and sales of Brazilian equities. Emerging-market equity funds received inflows for a ninth week, taking in $996.6 million, EPFR said. Brazil equity funds suffered $473 million of withdrawals, the biggest outflows in almost four years, amid concerns of interest-rate increases. To contact the reporter on this story: Lilian Karunungan in Singapore at at lkarunungan@bloomberg.net ; Garfield Reynolds in Sydney at greynolds1@bloomberg.net

Read the full article →

Russia Says U.S. Nuclear-Arms Accord Signals `New Strategic Relations’

April 6, 2010

By Paul Abelsky April 6 (Bloomberg) — Russia’s nuclear-arms reduction treaty with the U.S. may signal the start of “new strategic relations” between the two nations, according to a statement distributed by the Kremlin. “The treaty ushers in a transition to a higher level of cooperation between Russia and the U.S., laying the foundation for qualitatively new strategic relations between the two countries,” according to the statement, e-mailed for release today. The agreement to cut the countries’ nuclear arsenals by almost a third will be signed by President Barack Obama and his Russian counterpart, Dmitry Medvedev , in Prague on April 8. Under the treaty, the warheads allowed for each side would be cut to 1,550 from 2,200 permitted under the existing treaty, which expired in December. The negotiations were conducted under “personal oversight” of the two leaders, the statement said. The new agreement, which was sealed in a call between Obama and Medvedev on March 26, also sets “simplified and less costly control mechanisms that correspond to modern realities,” the Kremlin said. To contact the reporter on this story: Paul Abelsky in Moscow at pabelsky@bloomberg.net .

Read the full article →

BTIG Hires Goldman’s Jesse Lentchner to Drive Expansion in Asia-Pacific

March 17, 2010

By Shani Raja March 18 (Bloomberg) — BTIG LLC hired Jesse H. Lentchner , who spent more than a decade at Goldman Sachs Group Inc. in Asia, as chief executive officer of its Asia-Pacific operations. Lentchner will join BTIG’s Hong Kong office in June, the brokerage’s Hong Kong office said today in an e-mailed statement. He will drive the firm’s expansion in Asia with a special focus on Hong Kong, Singapore, Japan and Australia. “Jesse is a significant and pivotal hire,” Kevin Chessen , head of international trading at BTIG, said in the statement. “His diverse global experience running large sophisticated businesses will give us a meaningful edge as we continue to expand our footprint.” To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

Read the full article →

Storm’s Insured Losses May Be $350 Million After Record New York Snowfall

March 5, 2010

By Dan Reichl March 5 (Bloomberg) — The storm that hit the U.S. East Coast last week, bringing record snow to New York City and power failures to New England, may have caused $350 million in insured losses, a catastrophe risk-modeling firm said. Insured losses may be in the range of $150 million to $350 million, Boston-based AIR Worldwide said today in an e-mailed statement. Including damage done by two earlier storms, insured losses in the month of February may be as high as $1.35 billion, the firm said. The latest storm pushed New York City’s snowfall for the season to more than 50 inches (127 centimeters) and set a record for the month of February in Central Park. More than 700,000 customers lost electrical power. Insurers may face claims after winds damaged buildings and roofs buckled under the accumulated weight of multiple storms, said Peter Dailey , director of atmospheric science at AIR Worldwide. “Damage to both structures and automobiles from fallen trees is also likely,” Dailey said in the statement. “While individual claims are not expected to be severe, the number of claims could be significant because the storm impacted a very wide area from New Jersey to Maine.” To contact the reporter on this story: Dan Reichl in San Francisco at dreichl@bloomberg.net

Read the full article →

Cheney Under Evaluation After Entering Washington Hospital With Chest Pain

February 22, 2010

By Nicholas Johnston Feb. 22 (Bloomberg) — Former Vice President Dick Cheney went to a Washington hospital today after experiencing chest pains, a statement from his office said. Cheney is resting comfortably as doctors at George Washington University Hospital are “evaluating the situation,” the statement said. Cheney, 69, has had four heart attacks, all of them before he became vice president in 2001. In October 2008, he was treated for an abnormal heart rhythm that was discovered by his doctors. To contact the reporter on this story: Nicholas Johnston in Washington at njohnston3@bloomberg.net

Read the full article →

Yara International Agrees to Buy Terra Industries for $4.1 Billion in Cash

February 15, 2010

By Vibeke Laroi Feb. 15 (Bloomberg) — Yara International ASA , the world’s largest fertilizer producer, agreed to buy Terra Industries Inc. for $4.1 billion to expand its sales in the U.S. Yara will pay $41.10 in cash for each Terra share and will sell as much as $2.5 billion of shares in a rights offer to fund the deal, Oslo-based Yara said in a statement today. The offer is 24 percent more than Terra’s closing share price of $33.25 in New York on Feb. 12. The takeover will close in about June, Yara said. “Yara is committed to the U.S. market, and this transaction presents an attractive opportunity for both companies to strengthen their positions in the U.S.,” Yara Chief Executive Officer Joergen Ole Haslestad said in the statement. Yara’s bid comes a month after Deerfield, Illinois-based CF Industries Holdings Inc. dropped its offer for Sioux City, Iowa- based Terra. CF had sought to acquire Terra since January 2009 while fending off a hostile bid from Agrium Inc. At stake in the three-way battle was whether Agrium or CF would be the world’s second-largest publicly traded maker of nitrogen-based fertilizers after Yara. To contact the reporter on this story: Vibeke Laroi in Oslo at vlaroi@bloomberg.net

Read the full article →

U.K. Financial Services Authority CEO Hector Sants to Step Down This Year

February 9, 2010

By Caroline Binham Feb. 9 (Bloomberg) — Hector Sants , the chief executive officer of Britain’s financial regulator, said he will leave the agency later this year. Sants, CEO of the Financial Services Authority since July 2007, will step down by the end of the summer, the regulator said in a statement. “When I was appointed I told the board that I planned to serve as CEO for three years, and I intend to stick to that timetable” said Sants, 54, in the statement. “Those three years have encompassed the most extraordinary circumstances for a financial regulator, and I am very proud of the manner in which the FSA rose to the challenge of dealing with such unprecedented turbulence across global financial markets.” Sants’s resignation comes at a key time for regulation both in the U.K. and across the world, where policy makers are trying to grapple with rules in the wake of the worst financial crisis in a generation. The opposition Conservative lawmakers in the U.K. have pledged to abolish the FSA and carve up its duties should they win this year’s election. They say the FSA’s lax oversight of banks contributed to the crisis. To contact the reporters on this story: Caroline Binham in London at cbinham@bloomberg.net

Read the full article →

Toyota 2010 Prius Brakes Investigated by U.S. Government, Following Japan

February 4, 2010

By Angela Greiling Keane Feb. 4 (Bloomberg) — Toyota Motor Corp.’s Prius hybrid car is under investigation by the U.S. Transportation Department for reports of defective brakes in its 2010 model. The department’s National Highway Traffic Safety Administration said in a statement today that it has received 124 reports from consumers, including four saying crashes occurred. “Safety is our top priority,” Transportation Secretary Ray LaHood said in the statement.  “We will continue to monitor these issues closely.” LaHood and Toyota President Akio Toyoda talked “late” yesterday, according to the statement. Toyoda “reassured” LaHood that the company “takes U.S. safety concerns seriously and puts safety at the top of the company’s priorities,” according to the statement. To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

Read the full article →

Williams College Ends No-Loan Policy for Student Aid Amid Endowment Losses

February 1, 2010

By Janet Frankston Lorin Feb. 1 (Bloomberg) — Williams College ended its policy of not including loans in students’ financial aid packages, in a cost-saving move triggered by endowment losses. Some first-year students who enter Williams in September 2011 will be offered “modest loans,” Interim President Bill Wagner said in a letter dated Jan. 31 and posted on the college’s Web site. Citing “prudence,” Wagner said the college, in Williamstown, Massachusetts, will also delay a construction project. Williams, ranked No. 1 among U.S. liberal-arts colleges by U.S. News & World Report magazine, was among more than 30 top- ranked private colleges to adopt policies in 2007 and 2008 that replaced loans in aid packages with grants that students don’t have to repay. The college’s endowment dropped by $400 million, or 22 percent, to $1.41 billion in the year ended June 30, the college reported in September. “The college’s focus is on adjusting to this new reality in ways that protect our core academic mission for the long run, keep Williams widely affordable and accessible, and value the great dedication of our faculty and staff,” Wagner said in the statement. “The continuous review of our aid policies is among the most careful of the college’s long-term deliberations.” About 2,000 students attend Williams, which was founded in 1793. Alumni include the lyricist and composer Stephen Sondheim and the New York Yankees owner George Steinbrenner. To contact the reporter on this story: Janet Frankston Lorin in New York jlorin@bloomberg.net .

Read the full article →

Foster’s Hires Diageo’s John Pollaers to Lead Australian Brewing Division

January 29, 2010

By Robert Fenner Jan. 29 (Bloomberg) — Foster’s Group Ltd., Australia’s biggest beer and wine maker, hired John Pollaers as managing director of its Carlton & United Breweries unit, the company’s largest and most profitable division. Pollaers, 47, who will commence in the role on April 7, was most recently head of Asia Pacific operations for Diageo Plc , Melbourne-based Foster’s said in a statement today. He will replace Alex Stevens , who resigned last month citing an undisclosed illness. Foster’s , which sells more than half of the nation’s beer, has been losing market share for its biggest brand Victoria Bitter as consumers switch to imported brews. The company created specialist sales teams for beer and wine last year, unwinding an earlier integration strategy that cost it customers. “John is well known and respected in the Australian market and has a proven track record in successfully leading and growing businesses,” Foster’s Chief Executive Officer Ian Johnston said in the statement. “I am excited to welcome someone of John’s caliber.” Pollaers worked at Diageo for almost 20 years. The London- based company, whose brands include Guinness stout and Smirnoff vodka, is the world’s largest liquor maker. Foster’s rose 0.4 percent to close at A$5.34 in Sydney trading. The stock has fallen 2.9 percent this month after being unchanged last year. To contact the reporter on this story: Robert Fenner in Melbourne rfenner@bloomberg.net

Read the full article →

Felix Rohatyn Returns to Lazard After 13 Years to Be CEO’s Special Adviser

January 27, 2010

By Zachary R. Mider Jan. 27 (Bloomberg) — Lazard Ltd. said Felix Rohatyn , the dealmaker who helped New York City navigate its financial crisis in the 1970s, will return to the investment bank he left 13 years ago. Rohatyn, 81, who worked at Lazard for almost 50 years, will be a special adviser to new Chief Executive Officer Kenneth Jacobs starting Feb. 1, Lazard said in a statement. He left the firm in 1997 and became U.S. ambassador to France. “Felix is a legend in our industry, and I am honored that he is returning to the firm that he helped create,” Jacobs said in the statement. Jacobs, 51, became CEO in November after the death of his predecessor, Bruce Wasserstein . To contact the reporter on this story: Zachary R. Mider in New York at zmider1@bloomberg.net

Read the full article →

U.K. Bans Islamist Group That Planned Afghanistan Protest in Memorial Town

January 12, 2010

By Thomas Penny Jan. 12 (Bloomberg) — The U.K. has banned an Islamist group that planned to hold a march in a town in England through which the bodies of dead servicemen are carried on their return from Afghanistan. Home Secretary Alan Johnson made an order at 7.30 a.m. today to ban Islam4UK, a Home Office spokesman said in a telephone interview. The group, which is also known as Al Muhajiroun and is already banned under two other names, has been proscribed under anti-terrorism laws, the Home Office said in an e-mailed statement. “We are clear that an organization should not be able to circumvent proscription by simply changing its name,” Johnson said in the statement. The group planned to hold a march through Wootton Bassett in Wiltshire, southwestern England, to protest civilian deaths in Afghanistan. The town has become famous for the tribute it pays to fallen soldiers flown into the nearby Royal Air Force base Lyneham and then carried along Wootton Bassett main street. The plans sparked anger in the U.K. media. To contact the reporter on this story: Thomas Penny in London at tpenny@bloomberg.net

Read the full article →

Heineken Will Buy Femsa’s Beer Unit in Transaction Valued at $7.7 Billion

January 11, 2010

By Celeste Perri Jan. 11 (Bloomberg) — Heineken NV agreed to buy the beer division of Fomento Economico Mexicano SAB in an all-share transaction valued at 5.3 billion euros ($7.7 billion). Femsa will own a 20 percent economic interest in Heineken Group as a result of the purchase, the Amsterdam-based company said in a statement posted on its Web site today. Heineken expects to achieve so-called synergies of 150 million euros a year by 2013, it said in the statement. The purchase will boost the Dutch brewer’s earnings per share after two years, the company said. “I am confident that this transaction will generate considerable future value for stakeholders in both groups,” Heineken Chief Executive Officer Jean-Francois van Boxmeer said in the statement. To contact the reporters on this story: Celeste Perri in Amsterdam at cperri@bloomberg.net .

Read the full article →

Seven CIA Workers Slain in Afghanistan Attack, Six Wounded, Panetta Says

December 31, 2009

By Viola Gienger Dec. 31 (Bloomberg) — Seven CIA employees were killed and six others injured in yesterday’s terrorist attack at a base in Afghanistan, the agency said in a statement today. The attack occurred at a forward operating base in Khost Province, CIA Director Leon Panetta said in a message to employees, according to the statement. The names and details of the employees’ work won’t be released “due to the sensitivity of their mission and other ongoing operations,” the agency said. “Those who make a real difference often face real danger,” Panetta said. U.S. military doctors and nurses saved the lives of those wounded in the attack, according to the statement. The Pentagon yesterday said eight civilians had been killed. To contact the reporter on this story: Viola Gienger in Washington at vgienger@bloomberg.net .

Read the full article →

Samsung Electronics Names Choi as CEO, Promotes Former Chairman Lee’s Son

December 14, 2009

By Kevin Cho Dec. 15 (Bloomberg) — Samsung Electronics Co. , Asia’s largest maker of chips, flat-screens and mobile-phones, appointed Choi Gee Sung as its new chief executive officer and promoted the former chairman’s son as chief operating officer. Choi, 58, replaces Lee Yoon Woo , 63, who will become head of the company’s board of directors, parent Samsung Group said in a statement today. Choi was previously responsible for Samsung’s mobile-phone and television businesses. Samsung today also promoted Lee Jae Yong , 41, son of former chairman Lee Kun Hee, to executive vice president of Samsung Electronics and appointed him to the newly created post of chief operating officer. “It’s a gradual process of the changing of the guards,” Kim Young Joon, head of equity management at NH-CA Asset Management Co. in Seoul, which manages the equivalent of $8.6 billion in assets. “For investors, the key will be whether they’ll do a good job.” Separately, Samsung Electronics said each of its business units will be managed as stand-alone companies to “create a more focused and responsive business structure.” There will be seven independent companies under the new organizational structure, Samsung said. “We believe now is the time for us to make these important organizational changes to prepare for the challenges and opportunities ahead,” Choi said in the statement. The Suwon, Korea-based company in October posted record quarterly profit in the third quarter as the global economic recovery spurred a rebound in prices. To contact the reporters on this story: Kevin Cho in Seoul at kcho2@bloomberg.net

Read the full article →

Zhu Zhu Pets Recall? ‘Toxic’ Robot Toys Are Unsafe, Group Claims

December 6, 2009

ST. LOUIS — A consumer group contends one of the holiday season’s must-have toys is unsafe. But the maker of the robotic Zhu Zhu Pets hamsters defended its product Saturday against a study by San Francisco-based GoodGuide that said higher-than-allowed levels of the chemical antimony were found in the toy. Good Guide named Zhu Zhu Pets hamsters one of the top-selling toys with low ratings after finding antimony, which can cause health problems, on the hair and nose of one of the toy hamsters, called Mr. Squiggles. The group assigned the toy, aimed at 3- to 10-year-olds, a rating of 5.2 on a 10-point scale. But the toy’s maker, St. Louis-based Cepia LLC, insisted in a statement that its product is safe and has passed rigorous testing. The company said it was contacting GoodGuide to share its testing data and determine how the report was founded. “I have been in the toy industry for more than 35 years, and being a father of children myself, I would never allow any substandard or unsafe product to hit the shelves,” Russ Hornsby, Cepia’s CEO, said in the statement. Zhu Zhu Pets, which retail for about $10, have become this season’s toy craze, following in the footsteps of Tickle Me Elmo and Cabbage Patch Kids. The items fetch $40 or more on resale Web sites like eBay and Craigslist. That’s what brought it to GoodGuide’s attention. GoodGuide CEO Dara O’Rourke told The Associated Press on Saturday that his group bought three of each of the year’s 30 hottest toys and tested them multiple times. Antimony was measured at 93 parts per million in the hamster’s fur and at 106 parts per million in its nose. Both readings exceed the allowable level of 60 parts per million, said O’Rourke, an associate professor of environmental science at the University of California, Berkeley. O’Rourke said GoodGuide’s test results, released Friday, also indicated the possibility that some toys contained phthalates, chemicals that were subject to tougher standards in the Consumer Protection Safety Improvement Act passed last year.

Read the full article →

Terrorism Is Suspected in Fatal Russian Train Derailment, Vesti Reports

November 27, 2009

By Anastasia Ustinova Nov. 28 (Bloomberg) — Terrorism is suspected in the deadly derailment late yesterday of an express train bound for St. Petersburg from Moscow, state-run television station Vesti said, citing unidentified investigators. Passengers reported hearing an explosion before the derailment, the station said. Investigators discovered a small “shell crater” at the scene, the station said. All trains between Moscow and St. Petersburg have been halted. At least 10 people died and 55 were injured in the incident, according to Vesti. The derailment occurred at 9:34 p.m. Moscow time, according to the Web site of OAO Russian Railways. Four of the train’s wagons derailed, and investigators are looking into the cause, the statement said. To contact the reporter on this story: Anastasia Ustinova in St. Petersburg at austinova@bloomberg.net

Read the full article →

Ahold to Cut $521 Million of Expenses After Profit Beats Analyst Estimates

November 18, 2009

By Jeroen Molenaar Nov. 18 (Bloomberg) — Royal Ahold NV , the owner of the U.S. Stop & Shop grocery chain, will cut 350 million euros ($521 million) in expenses and pursue expansion opportunities after reporting third-quarter profit that beat analysts’ estimates. Ahold plans the reduction by the end of 2012, the Amsterdam-based company said in a statement today. Third-quarter net income rose to 238 million euros from 195 million euros in the year-earlier period, according to the statement. That compared with an average estimate of 179 million euros in a Bloomberg survey of eight analysts. Ahold will “pursue opportunities to grow within existing and new markets,” following a management reshuffle this month, Chief Executive Officer John Rishton said in the statement. The company should use its excess cash of about 2 billion euros to make acquisitions or buy back stock to avoid becoming a bid target, analysts including Petercam’s Fernand de Boer have said. Rishton, who is completing a plan to cut 500 million euros in expenses, boosted profitability at Stop & Shop by reducing prices to spur volume growth. Operating profit at Albert Heijn, the biggest Dutch grocery chain, rose 5 percent and Ahold sold more goods in all markets, it said today. “These are robust numbers, given market conditions,” said SNS Securities analyst Richard Withagen today. “Especially profit at Albert Heijn exceeded expectations.” Withagen rates Ahold stock “accumulate.” Albert Heijn Operating profit at the Dutch chain was 147 million euros, boosted by store disposals. Withagen had estimated profit on that basis to drop 2.9 percent to 136 million euros. Same-store sales at the chain fell for the first time in almost six years on increased discounting. Ahold yesterday gained 0.5 percent to 9.15 euros in Amsterdam trading, giving the company a market value of 10.8 billion euros. The stock has risen 4 percent this year. Belgian rival Delhaize Group, owner of the U.S. Food Lion stores, would be a likely industry buyer of Ahold while U.K. market leader Tesco Plc should consider buying the Dutch company, ING analysts have said. To contact the reporter on this story: Jeroen Molenaar in Amsterdam jmolenaar1@bloomberg.net

Read the full article →

Vodafone Group’s First-Half Profit Rises 2.9%; More Cost Cuts Are Planned

November 10, 2009

By Simon Thiel Nov. 10 (Bloomberg) — Vodafone Group Plc , the world’s largest mobile-phone company, posted a 2.9 percent increase in first-half operating profit and said it plans more cost cuts. Earnings before interest, taxes, depreciation and amortization, or Ebitda , in the six months ended September rose to 7.46 billion pounds ($12.4 billion) from 7.24 billion pounds a year earlier, the company said in an e-mailed statement today. Sales advanced 9.3 percent to 21.76 billion pounds. The average estimate of analysts surveyed by Bloomberg was for Ebitda of 7.47 billion pounds on revenue of 21.7 billion pounds. “The group has performed in line with our expectations and we have made strong progress with our strategic priorities, in particular in mobile data and cash generation,” Chief Executive Officer Vittorio Colao said in the statement. “The 1 billion pounds cost-reduction program is expected to be delivered a year ahead of plan and we have extended this to a further 1 billion pounds of cost savings by 2012.” Newbury, England-based Vodafone is reducing expenses to offset a slide in demand for telecommunications services. Earlier this year, it joined operators such as Deutsche Telekom AG , Royal KPN NV and Mobistar SA in saying that the recession is hurting sales and profits as consumers and companies cut back on travel and mobile-phone use. To contact the reporters on this story: Simon Thiel in London at sthiel1@bloomberg.net .

Read the full article →

Axa Asia Pacific Rejects Unsolicited $10 Billion Proposal from AMP, AXA SA

November 8, 2009

By Angus Whitley Nov. 9 (Bloomberg) — Axa Asia Pacific Holdings Ltd. said it rejected an A$11 billion ($10 billion) cash and share offer from Australian asset manager AMP Ltd. and its parent AXA SA . The unsolicited bid from Sydney-based AMP and Paris-based insurer AXA SA valued Axa Asia Pacific at as much as A$5.34 a share, the company said in a statement today. That’s 24 percent higher than Axa Asia Pacific’s previous closing price. “The proposal significantly undervalues AXA Asia Pacific,” Chairman Rick Allert said in the statement. “The Independent Board Committee will continue to appropriately and carefully consider all compelling strategic options available that are in the interests of shareholders.” The bid consisted of 0.6896 AMP shares and A$1.3796 in cash for each Axa Asia Pacific share, the company said. AMP planned to buy all the shares of Axa Asia Pacific and then sell the Asian assets to AXA SA, according to the statement. AMP in August said first-half profit fell on lower management and performance fees at AMP Capital Investors. AXA SA last month posted a drop in third-quarter sales after the financial crisis curbed demand for life-insurance policies in the U.S. To contact the reporter on this story: Angus Whitley in Sydney at awhitley1@bloomberg.net

Read the full article →

Best Buy to Open Online Store for Movies, Competing With Apple’s iTunes

November 3, 2009

By Adam Satariano Nov. 3 (Bloomberg) — Best Buy Co. , the world’s largest electronics retailer, will start an online store for movies and television shows that will compete with Apple Inc. ’s iTunes. The service will use technology licensed from Sonic Solutions Inc. , according to a statement today from both companies. Sonic’s Roxio CinemaNow system will be installed on televisions, computers, Blu-ray players, set-top boxes and mobile phones sold by Richfield, Minnesota-based Best Buy. The digital video store expands Best Buy’s foray into services, helping the company increase customer loyalty, Chief Executive Officer Brian Dunn said in the statement. The content will be stored on servers so people can watch on any device, similar to how Web-based e-mail can be viewed on different computers, said Sonic Chief Executive Officer Dave Habiger . “What we’re creating is movies in the cloud that play back anywhere,” Habiger said in an interview. Sonic Solutions, based in Novato, California, rose 89 cents, or 17 percent, to $6.13 at 10:34 a.m. in Nasdaq Stock Market trading. The stock had almost tripled this year before today. Best Buy fell 31 cents to $38.58 in New York Stock Exchange composite trading. The shares had risen 38 percent this year before today. Sonic’s technology will be included on devices made by Samsung Electronics Co. , Sony Corp. Panasonic Corp. , Toshiba Corp. and other manufacturers. The service will allow customers to buy or rent new releases, according to the statement. Digital Delivery The deal “allows Best Buy to quickly establish a strong position in the digital delivery of video entertainment,” Best Buy’s Dunn said in the statement. Best Buy services also include Geek Squad technical support. Apple’s iTunes sells digital downloads of films and TV shows and has withstood online threats from other retailers. Netflix Inc. offers mail-order DVD rentals and streaming of older releases. Sonic has 22,000 movies in its library and licensing deals with every major Hollywood studio, Habiger said. The company, which already provides technology for Blockbuster Inc .’s online store and TiVo Inc. ’s digital-video recorders, releases most of its movies on the same day they can be rented on DVD. Declining DVD sales as a result of mail-order and kiosk rental services made the studios more interested in striking digital-distribution deals, Habiger said. “Without some of those things collapsing their margins, this would have taken a lot longer,” he said. To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net

Read the full article →

Berkshire Buys Burlington Northern for $34 Billion in Biggest Buffett Deal

November 3, 2009

By Dan Kraut Nov. 3 (Bloomberg) — Berkshire Hathaway Inc. agreed to buy railroad Burlington Northern Santa Fe Corp. in the company’s biggest takeover under Warren Buffett. Buffett’s firm will buy the 77.4 percent of the railroad it doesn’t already own for $100 a share, valuing the transaction at about $44 billion, including $10 billion in outstanding debt, Omaha, Nebraska-based Berkshire said in a statement today distributed by Business Wire. That compares with the railroad’s closing price yesterday of $76.07. “It’s an all in-wager on the economic future of the United States,” Buffett said in the statement. Berkshire plans to split each of its Class B shares into 50 new shares to help the acquisition. To contact the reporter on this story: Dan Kraut in New York at dkraut2@bloomberg.net

Read the full article →

RBS to Sell Insurance, Other Assets as Government Increases Stake to 84.4%

November 3, 2009

By Jon Menon and Andrew MacAskill Nov. 3 (Bloomberg) — Royal Bank of Scotland Group Plc will sell its insurance division and bank branches after negotiations with the European Commission and the U.K. Treasury, pushing it further into government hands. RBS also agreed to put 282 billion pounds of assets into the government’s Asset Protection Scheme and take an additional 25.5 billion pounds of investment from the Treasury, the Edinburgh-based bank said today in a statement. As a result, the government will increase its stake in RBS to 84.4 percent. “The agreement in principle reached with the EC is clearly more material for the structure of our Group than we had hoped, increasing risk to both execution of the plan and earnings dilution,” Chief Executive Officer Stephen Hester said in the statement. “But this is still an acceptable result for RBS.” RBS will increase the first loss on the assets protected under the government insurance program to about 60 billion pounds, from the 42.2 billion pounds initially agreed. The bank will sell its RBS branches in England and Wales, as well as its NatWest branches in Scotland. RBS will also sell its insurance and Global Merchant Services units, as well as its stake in Sempra Commodities to meet European Union requirements for taking state aid, RBS said in the statement. To contact the reporter on this story: Jon Menon in London at jmenon1@bloomberg.net Andrew MacAskill in London at amacaskill@bloomberg.net

Read the full article →

CIT Group Obtains an Additional $4.5 Billion in Financing, Spurning Icahn

October 28, 2009

By Linda Shen Oct. 28 (Bloomberg) — CIT Group Inc., the 101-year-old commercial lender seeking to avoid collapse, received $4.5 billion in financing by expanding an existing credit facility. The loan came from a “diverse group of lenders” including bondholders, who also supplied the company with $3 billion of financing in July, New York-based CIT said today in a statement distributed by Business Wire. A competing $4.5 billion loan from billionaire investor Carl Icahn was “unfunded,” CIT said in the statement. “Despite several requests from the company for information and multiple deadline extensions, the company has yet to receive a signed credit agreement and evidence of Mr. Icahn’s ability to fund the commitment,” CIT said. To contact the reporter on this story: Linda Shen in New York at lshen21@bloomberg.net

Read the full article →

Caterpillar Profit, 2009 Outlook Top Estimates on Capacity, Inventory Cuts

October 20, 2009

By Will Daley Oct. 20 (Bloomberg) — Caterpillar Inc. , the world’s largest maker of bulldozers and excavators, posted third-quarter profit that beat analysts’ estimates and issued a full-year earnings forecast that exceeded the highest prediction. Net income dropped to $404 million, or 64 cents a share, from $868 million, or $1.39, a year earlier, the Peoria, Illinois-based company said today in a statement. The average estimate in a Bloomberg analyst survey was 5 cents a share. Shares rose in early New York trading. Caterpillar has slashed inventories and capacity amid the worst decline in its markets since the 1930s. Chief Executive Officer Jim Owens has cut about 18,000 full-time jobs and about the same amount of temporary and contract workers since December 2008 as faltering demand led to a net loss in 2009’s first three months. Sales fell 44 percent to $7.3 billion from $13 billion. “We believe the third quarter marked the low point for Caterpillar sales and revenues in what has been the toughest recession since the 1930s,” Owens said in the statement. “We are seeing encouraging signs that indicate a recovery may be under way.” Caterpillar rose $2.04, or 3.5 percent, to $59.89 at 7:40 a.m. in trading before the regular open of the New York Stock Exchange. The shares climbed 30 percent this year through yesterday. Caterpillar narrowed its 2009 forecast range to $1.85 to $2.05 a share, from $1.15 to $2.25. The average estimate was $1.48 a share and the highest prediction was $1.75. The revenue forecast is now $32 billion to $33 billion, compared with its previous forecast of $32 billion to $36 billion. The company is considered a bellwether for its ties to the construction and mining industries and its overseas presence. To contact the reporter on this story: Will Daley at wdaley2@bloomberg.net

Read the full article →

Goldman Sachs Provides Ohio Real Estate Loan in Bid to Restart CMBS Market

October 8, 2009

By Sarah Mulholland Oct. 8 (Bloomberg) — Developers Diversified Realty Corp. , an Ohio real estate company, received a $400 million loan from a Goldman Sachs Group Inc. unit in a possible first step toward restarting the commercial-mortgage bond market. The five-year loan is secured by 28 shopping centers and will be used to repay debt on those properties and others, the company said today in a statement distributed by Business Wire. Developers Diversified and Goldman Sachs are working with the Federal Reserve to qualify the loan for the government’s program to unfreeze the $700 billion market for securities backed by commercial mortgages, according to the statement. The Fed expanded its Term Asset-Backed Securities Loan Facility to newly issued commercial real estate debt in June, though no sales have been completed. “We are pleased to announce continued progress raising long-term capital to retire short-term debt,” David Oakes , chief investment officer of the Beachwood, Ohio-based company, said in the statement. “We look forward to announcing additional progress in the coming months.” Sales of U.S. commercial mortgage-backed debt slumped to $12.2 billon last year from a record $237 billion in 2007 as the credit crisis sapped demand, choking off financing to borrowers with maturing debt, according to JPMorgan Chase & Co. data. There have been no sales of the debt since June 2008, according to data compiled by Bloomberg. To contact the reporter on this story: Sarah Mulholland in New York at smulholland3@bloomberg.net

Read the full article →

CIT Group Pledges $5.7 Billion in Debt Reductions as Exchange Offer Begins

October 2, 2009

By Pierre Paulden Oct. 1 (Bloomberg) — CIT Group Inc. said it started a restructuring plan designed to help the 101-year-old commercial lender meet regulatory capital requirements and return to profitability. The company is asking bondholders to swap unsecured notes for new secured debt or shares or a combination of the two, New York-based CIT said today in an e-mailed statement. The debt will have maturities ranging from four to eight years, CIT said. The swaps can’t be completed unless the company reduces its debt by $5.7 billion, CIT said. The company said it may choose to file for Chapter 11 bankruptcy protection if it doesn’t meet the target of the exchange. At the same time, CIT is asking bondholders and other owners of its debt to approve a prepackaged reorganization plan. A steering committee of bondholders told the company it will exchange $10 billion of unsecured debt or vote for the prepackaged bankruptcy plan, according to the statement. To contact the reporter on this story: Pierre Paulden in New York at ppaulden@bloomberg.net

Read the full article →

ICAP Says First-Half Pretax Profit to Be `Slightly Lower’ Than Year Before

October 1, 2009

By John Glover Oct. 1 (Bloomberg) — ICAP Plc , the world’s largest broker of transactions between banks, said first-half profit was “slightly” lower than a year earlier as its credit and equity derivatives businesses slowed. Revenue in the period increased 6 percent, London-based ICAP said in a statement today. Pretax profit for the year to March 2010 will be in line with analysts’ expectations of between 309 million pounds ($493 million) and 354 million pounds, the company said. “In electronic broking, markets have been quieter than the very active conditions a year ago,” Chief Executive Officer Michael Spencer said in the statement. “Cost reductions and other measures have helped to hold margins.” The slump in credit markets last year spurred ICAP’s customers to increase trading, boosting the amount of business it handles. As markets calmed this year amid unprecedented government efforts, trading in some of ICAP’s markets slowed. ICAP fell 4.5 pence, or 1 percent, to 418.2 pence at 8:05 a.m. in London after slumping as much 4.85 percent. The broker has gained 44 percent this year, valuing the company at 2.7 billion pounds, compared with an increase of 16 percent on the U.K.’s benchmark FTSE 100 Index . The FTSE 350 Banks Index of U.K. financial companies has climbed 36 percent year-to-date. Pretax profit before one-off items and impairments, ICAP’s preferred measure of performance, was 346 million pounds in the fiscal year to March 2009, it said in May. “Many of the markets in which we operate are benefiting from the continuing low short-term interest rates, steep yield curves and substantial corporate and government bond issuance,” Spencer said in the statement. “Both credit and equity derivatives have experienced more difficult conditions.” Derivatives are financial instruments derived from stocks, bonds, loans, currencies and commodities, or linked to specific events like changes in interest rates. To contact the reporter on this story: John Glover in London at johnglover@bloomberg.net

Read the full article →

Federal Reserve Proposes Rules to Implement Credit-Card Law, Restrict Fees

September 29, 2009

By Jeff Plungis Sept. 29 (Bloomberg) — The U.S. Federal Reserve proposed rules today that will end banks’ ability to apply credit-card payments to balances with the lowest interest rates first, implementing legislation Congress passed in May. The Fed also proposed that creditors obtain consumers’ consent before charging fees for transactions that exceed credit limits. Restrictions on lending to people under the age of 21 and subprime credit-card fees were also included in the rules, the Fed said in a statement . “The rule bans several harmful practices and requires greater transparency in the disclosure of the terms and conditions of credit-card accounts,” Federal Reserve Governor Elizabeth Duke said in the statement. President Barack Obama signed the credit-card legislation in May, describing its provisions as “common-sense reforms” that would “protect consumers.” The proposed Fed rules will take effect Feb. 22. To contact the reporter on this story: Jeff Plungis in Washington at jplungis@bloomberg.net .

Read the full article →

Telstra Told to Split Into Network, Retail Units to Bolster Competition

September 14, 2009

By Robert Fenner Sept. 15 (Bloomberg) — Telstra Corp., Australia’s largest telephone company, should split into separate businesses to promote competition in the nation’s telecommunications market. “It is the government’s clear desire for Telstra to structurally separate on a voluntary and cooperative basis,” Communications Minister Stephen Conroy said in an e-mailed statement today. If Telstra chooses not to break up its businesses, proposed changes in the legislation will impose a “strong functional separation framework” on Telstra, Conroy said in the statement. Separating Telstra’s wholesale and retail arms would increase transparency and foster competition, the Australian Competition and Consumer Commission said in June in a submission to the government. The legislation would prevent Telstra from acquiring more spectrum for wireless services while it “remains vertically integrated,” controls a fixed-line network and maintains a half share of Foxtel, Conroy said. Foxtel is Australia’s largest pay- television operator. Some of the conditions may be dropped if Telstra cooperates with the government, according to the statement. To contact the reporter on this story: Robert Fenner in Canberra rfenner@bloomberg.net

Read the full article →

RBS Won’t Call Four Subordinated Bonds After Objection From U.K. Regulator

September 4, 2009

By John Glover Sept. 4 (Bloomberg) — Royal Bank of Scotland Group Plc , the largest bank controlled by the U.K., said it won’t call four subordinated bonds after an objection from reglators. The Financial Services Authority told RBS not to exercise its option of redeeming the notes early after the European Commission said banks shouldn’t use state aid to repay equity and subordinated debt, the Edinburgh-based lender said in a statement today. All four of the bonds have call dates in October, according to the statement. Two of them, with a combined face value of 500 million euros ($715 million), are so-called upper Tier 2 bonds while the other two securities, totaling A$1 billion ($840 million), are more-senior lower Tier 2 notes, RBS said. To contact the reporter on this story: John Glover in London at johnglover@bloomberg.net

Read the full article →

Ford’s Rating Raised to Caa1 by Moody’s as Restructuring Brightens Outlook

September 3, 2009

By Keith Naughton Sept. 3 (Bloomberg) — Ford Motor Co. ’s credit rating was raised by Moody’s Investors Service because of the automaker’s cost cuts, available funds and “robust” vehicle lineup. The rating was revised two steps higher to Caa1 from Caa3, Moody’s said in a statement today. The new grade, which affects about $25 billion in debt, is seven levels below investment status. Moody’s also changed its outlook for the Dearborn, Michigan-based automaker to stable from negative. “Ford has achieved a more sustainable cost structure and a liquidity position that should enable it to fund an expected operating cash burn until the recovery in industry demand enables Ford to reach its breakeven production levels around 2011,” New York-based Moody’s said in the statement. Ford, the only major U.S. automaker to avoid bankruptcy, has increased U.S. sales for two consecutive months. The company posted second-quarter net income of $2.26 billion after an accounting gain, and its $638 million operating loss was less than half of what analysts had estimated. The company’s U.S. vehicle sales rose 17 percent in August, the most among major automakers, aided by the federal government’s “cash for clunkers” incentive program. “Ford’s product portfolio and new product pipeline have not been this robust or competitive in many years,” said Bruce Clark , a Moody’s senior vice president, in the statement. The automaker had a record $14.7 billion net loss last year. Chief Executive Officer Alan Mulally has said Ford will break even or earn a profit in 2011. Ford gained 45 cents, or 6.4 percent, to $7.48 at 4 p.m. in New York Stock Exchange composite trading . The shares have more than tripled this year. To contact the reporter on this story: Keith Naughton in Southfield, Michigan at Knaughton3@bloomberg.net

Read the full article →

Qantas Posts First Loss in Six Years as Recession Curbs Demand for Travel

August 18, 2009

By Robert Fenner Aug. 19 (Bloomberg) — Qantas Airways Ltd., Australia’s biggest airline, posted its first half-year loss in six years as the global recession hammered demand for international travel. The carrier had a loss of A$93 million ($77 million) in the six months ended June, compared with net income of A$351 million a year earlier. Second-half figures were calculated by subtracting first-half earnings from the A$117 million full-year profit the Sydney-based company reported today. Qantas has cut fares and offered promotions to stoke demand and lure travelers from Singapore Airlines Ltd. and UAL Corp.’s United Airlines. Chief Executive Officer Alan Joyce , 43, has also grounded planes, cut jobs and scrapped new aircraft orders to cope with the biggest drop in air travel since outbreaks of SARS and bird flu in 2003. “There has never been a more volatile and challenging time for the world’s aviation industry,” Joyce said in the statement. Qantas shares closed yesterday at A$2.60. The stock has declined 1.1 percent this year compared with an 18 percent rise in the benchmark S&P/ASX 200 index. To contact the reporter on this story: Robert Fenner in Melbourne rfenner@bloomberg.net

Read the full article →

Taiwan Hit by 6.5-Quake, Shaking Buildings; No Damage, Injuries Reported

August 16, 2009

By Weiyi Lim Aug. 17 (Bloomberg) — A magnitude-6.5 earthquake struck off the coast of Taiwan at about 8:05 a.m. and shook buildings in the capital city Taipei more than 200 kilometers away, the Central Weather Bureau said in a statement on its Web site. The temblor struck at a depth of 11 kilometers about 187.7 kilometers east from the coast of Hualian county, the statement said. To contact the reporter on this story: Weiyi Lim in Taipei at wlim26@bloomberg.net

Read the full article →

Iceland, IMF Staff Reach Agreement Ending Delay in Review of Aid Package

July 31, 2009

By Brendan Murray July 31 (Bloomberg) — The International Monetary Fund said its staff has reached an agreement with officials in Iceland that will end a delay in the first review of the country’s financial rescue package. “The agreement is now being reviewed by IMF management and will then need to be presented to the IMF’s executive board for their consideration and approval,” Poul Thomsen, deputy director of the IMF’s European department, said in an e-mailed statement today. A board meeting “could be held in late August or early September.” The review, initially scheduled for the first quarter of 2009, is needed for Iceland to get a $163 million disbursement that is part of a bigger financial aid package, the IMF official said in the statement. To contact the reporter on this story: Brendan Murray in Washington at brmurray@bloomberg.net

Read the full article →

Iceland, IMF Staff Reach Agreement Ending Delay in Review of Aid Package

July 31, 2009

By Brendan Murray July 31 (Bloomberg) — The International Monetary Fund said its staff has reached an agreement with officials in Iceland that will end a delay in the first review of the country’s financial rescue package. “The agreement is now being reviewed by IMF management and will then need to be presented to the IMF’s executive board for their consideration and approval,” Poul Thomsen, deputy director of the IMF’s European department, said in an e-mailed statement today. A board meeting “could be held in late August or early September.” The review, initially scheduled for the first quarter of 2009, is needed for Iceland to get a $163 million disbursement that is part of a bigger financial aid package, the IMF official said in the statement. To contact the reporter on this story: Brendan Murray in Washington at brmurray@bloomberg.net

Read the full article →

Iceland, IMF Staff Reach Agreement Ending Delay in Review of Aid Package

July 31, 2009

By Brendan Murray July 31 (Bloomberg) — The International Monetary Fund said its staff has reached an agreement with officials in Iceland that will end a delay in the first review of the country’s financial rescue package. “The agreement is now being reviewed by IMF management and will then need to be presented to the IMF’s executive board for their consideration and approval,” Poul Thomsen, deputy director of the IMF’s European department, said in an e-mailed statement today. A board meeting “could be held in late August or early September.” The review, initially scheduled for the first quarter of 2009, is needed for Iceland to get a $163 million disbursement that is part of a bigger financial aid package, the IMF official said in the statement. To contact the reporter on this story: Brendan Murray in Washington at brmurray@bloomberg.net

Read the full article →

Iceland, IMF Staff Reach Agreement Ending Delay in Review of Aid Package

July 31, 2009

By Brendan Murray July 31 (Bloomberg) — The International Monetary Fund said its staff has reached an agreement with officials in Iceland that will end a delay in the first review of the country’s financial rescue package. “The agreement is now being reviewed by IMF management and will then need to be presented to the IMF’s executive board for their consideration and approval,” Poul Thomsen, deputy director of the IMF’s European department, said in an e-mailed statement today

Read the full article →

Win Bischoff, Former Citigroup Executive, Is Named Lloyds Banking Chairman

July 27, 2009

By Jon Menon July 27 (Bloomberg) — Lloyds Banking Group Plc , the U.K.’s biggest mortgage lender, named Win Bischoff , the former chairman of Citigroup Inc. and a government adviser, to replace Chairman Victor Blank , who is to retire. Bischoff will take up the post at the bank, which is 43 percent owned by the U.K.

Read the full article →

Agilent Technologies Plans to Buy Instrument Maker Varian for $1.5 Billion

July 27, 2009

By Ville Heiskanen July 27 (Bloomberg) — Agilent Technologies Inc. , the world’s biggest maker of scientific-testing equipment, agreed to buy Varian Inc. for $1.5 billion in cash to add instruments used in the study of atoms and molecules. Varian shareholders will receive $52 a share, about 35 percent more than the closing price on July 24, Agilent said

Read the full article →

Bristol-Myers Squibb to Acquire Cancer Drugmaker Medarex for $2.4 Billion

July 22, 2009

By Tom Randall July 22 (Bloomberg) — Bristol-Myers Squibb Co. said it agreed to buy Medarex Inc. for about $2.4 billion to add to its cancer-treatment products. Bristol will pay $16 a share, a 90 percent premium over today’s closing price of $8.40 a share for Princeton, New Jersey-based Medarex, the company said today in a statement

Read the full article →

U.K. Insurer FSA Stress Tests Assumed V-Shaped Recession, 20% Stock Drop

July 21, 2009

By Caroline Binham July 21 (Bloomberg) — U.K. insurers were stress-tested using the model of a 1980s’-style recession that can be plotted as a sharp ‘V’ on a graph, and assumed a 20 percent fall in equity prices, Britain’s financial regulator said today. The Financial Services Authority said in a statement that its stress-test model for insurers differed from that used for banks.

Read the full article →

Standard Chartered Hires Donald Tsang’s Sister Katherine to Run China Unit

July 20, 2009

By Kelvin Wong July 21 (Bloomberg) — Standard Chartered Plc , the British bank earning most of its profit in emerging markets, named Katherine Tsang chairman for its Greater China operation. Tsang, sister of Hong Kong’s Chief Executive Donald Tsang , has been the bank’s chief executive officer for mainland China since January 2005. Standard Chartered made the announcement in an e-mailed statement

Read the full article →

KKR’s Purchase of European Buyout Affiliate Approved by Fund’s Directors

July 20, 2009

By Larry Edelman July 20 (Bloomberg) — KKR & Co. ’s plan to purchase the assets of its Amsterdam-listed buyout fund was approved by the affiliate’s board, bringing the private-equity firm a step closer to being publicly traded. The agreement was supported by the three directors of KKR Private Equity Investors LP who are independent of the fund and of KKR , the companies said today in a statement

Read the full article →