Saturday, September 13, 2008
AUTOMOTIVE
GM Chief Seeks Loan Program
General Motors' chief executive urged Congress to provide funding for a $25 billion loan program and give the industry flexibility to apply it to fuel-efficiency gains across the vehicle lineup.
Rick Wagoner, right, asked lawmakers at a Senate energy summit to fund a provision in last year's energy bill that would allow the loans to be extended and to draft regulations for the program.
Wagoner said the funding would be "very helpful in enabling the industry to move more rapidly" to produce fuel-efficient vehicles.
The government interest rate for the loans would be around 5 percent, providing about $100 million a year in savings for the companies for every $1 billion in loans.
Chrysler to Offer More BuyoutsChrysler said it will make another round of early retirement and buyout offers to factory workers in Michigan to reduce the number who are on indefinite layoff due to slumping sales.
Employees will learn about the offers this month, company officials said during an event at a Warren factory where the automaker celebrated the launch of the new Dodge Ram pickup.
About 13,800 of Chrysler's 45,000 hourly workers worldwide are eligible for the offers, and most are in the Detroit area, Chrysler said in a statement.
United Auto Workers Vice President General Holiefield said the offers are similar to past packages offered by the company, but this round has a new education option offered with the state of Michigan. Assistance includes health benefits, cash and up to $10,000 for two years of certified training so workers can go back to school while still being able to support a family, said Al Iacobelli, vice president for employee relations.
Delphi, GM Reach Pension DealDelphi and General Motors said they have reached a new deal on the automaker's role in Delphi's bankruptcy exit, including the transfer of employee pensions.
Under the deal, which needs court approval, GM's financial support of Delphi's emergence from court protection would grow to $10.6 billion, up from $6 billion in an earlier plan. The automaker would now take on $3.4 billion in pension obligations for hourly workers, instead of the $1.5 billion that was predicted earlier.
The deal fends off the government's pension insurer, which threatened to file a $900 million claim against Delphi if the companies didn't move forward with a plan to transfer hourly pension obligations to GM.
EUROPEAN UNIONMinisters Shun Talk of Recession
The 15-nation euro zone economy isn't on the edge of recession and doesn't need a major spending program to boost growth, Luxembourg Prime Minister Jean-Claude Juncker said after leading talks between euro finance ministers.
Juncker said the economy's contraction in the second quarter took governments by surprise, but some relief is coming as the euro sinks and oil prices tumble.
"You shouldn't say that Europe is on the brink of recession: It's not true," Juncker said after the finance ministers met in Nice to discuss their slowing economy. "For months now we have ruled out a stimulus package."
MERGERS & ACQUISITIONSWalgreen Makes Bid for Longs
Walgreen, the largest U.S. drugstore chain, offered to buy Longs Drug Stores for $3 billion in an attempt to scuttle CVS/Caremark's agreement to buy Longs. Walgreen's $75-a-share cash offer is 4.9 percent, higher than CVS/Caremark's bid to buy Longs, Walgreen said.
The Walgreen offer, exactly one month after CVS's offer was made public, puts pressure on CVS to raise its bid or risk losing a chance to add pharmacies in two of the fastest-growing U.S. states, Nevada and Arizona.
Sale of Weather Channel ClosesLandmark Communications said it closed its $3.5 billion sale of The Weather Channel to NBC Universal, Blackstone Group and Bain Capital.
In addition to The Weather Channel, the deal includes several related assets such as weather services for newspapers and radio stations and the widely used Web site Weather.com. Landmark also sold its stake in Pelmorex, a Canadian weather company, as part of the deal.
LEGALSuit Challenges Texting Rates
Verizon Communications, AT&T, Sprint Nextel and T-Mobile USA, the four biggest U.S. phone companies, were sued by Illinois residents over claims that they conspired to raise text-messaging rates.
The proposed class-action lawsuit seeks to represent all U.S. customers who purchased text-messaging services since Jan. 1, 2005. The conspiracy led consumers to pay artificially inflated prices, according to the complaint filed in federal court in Chicago.
EXECUTIVESJos. A. Bank Chief to Retire
Men's clothing retailer Jos. A. Bank Clothiers of Hampstead, Md., said chief executive Robert Wildrick will retire from that post and become chairman of the board, effective Dec. 21. He will be replaced by R. Neal Black, who will also remain president. He has been chief merchandising officer since 2000. Andrew A. Giordano, will become chairman emeritus and remain lead independent director. James H. Ferstl and Henry Homes III have been elected to the board.
Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.
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