Friday, November 7, 2008
WALL STREET
Fidelity Announces More Layoffs
Fidelity Investments said it will cut nearly 1,300 jobs this month and layoff more staff early next year in response to declining markets that have eroded mutual fund assets and the fees Fidelity earns from its core business.
The cuts, affecting 2.9 percent of Fidelity's workforce of 44,400, will come from Fidelity offices across the country and affect positions of all levels, the Boston-based company said. A second round of layoffs is planned in the first three months of next year, with the number of those cuts and other details to be released in coming weeks.
The cuts are the third round this year for Fidelity, which eliminated about 800 jobs in two previous rounds as part of a reorganization of some business units.
PHILANTHROPYRecord Gift for Business School
The University of Chicago said that an alumnus has given its business school a $300 million gift, a record sum that comes as universities worry they'll see donations dry up amid the financial meltdown.
The unrestricted donation from David G. Booth, chairman of Dimensional Fund Advisors, is the largest individual gift to a U.S. business school and the largest in the University of Chicago's history, said Dean Edward Snyder. The school will be renamed the University of Chicago Booth School of Business and the money will be used to "attract star faculty", Snyder said.
The previous record for a business school was a $105 million gift to Stanford University in 2006 from Nike founder Philip H. Knight.
LEGALCraigslist Cracks Down
Craigslist said it would take steps to keep people from posting ads that could facilitate prostitution, human trafficking and child exploitation. The move came as part of an agreement with 40 states, which had pressured the online advertising company to help block offers of illegal activities.
Under the agreement, anyone who posts an "erotic services" ad will be required to provide a working phone number and pay a fee with a valid credit card. The Web site will provide that information to law enforcement if subpoenaed.
Jim Buckmaster, Craigslist's chief executive, said the deal would allow legitimate escort services to continue advertising, while providing a strong disincentive to companies that are conducting illegal business.
BANKINGWells Fargo Raises $11 Billion
Wells Fargo raised $11 billion in a stock sale to help fund its purchase of Wachovia, exceeding its estimate for the offering.
The bank said it sold 407.5 million shares for $27 each, 6.2 percent below yesterday's closing price of $28.77. The company may sell an additional 61 million shares if demand warrants. The San Francisco-based lender had planned to raise $10 billion.
The Treasury bought $25 billion of Wells Fargo's preferred shares last month as part of its rescue of the banking industry. Wells Fargo is expanding its deposit base to the East Coast with its purchase of Charlotte-based Wachovia, which is expected to close by year's end.
Wells Fargo shares fell $2.91, or 9 percent, to close at $28.77.
EARNINGSThe Walt Disney Co. said its fiscal fourth-quarter earnings fell 13 percent, to $760 million from $877 million in the comparable period last year, in part because it had to set aside a cash reserve to handle fallout from the collapse of Lehman Brothers. The entertainment conglomerate said revenue rose 5.8 percent to $9.45 billion. Disney warned that slipping consumer confidence would affect its business in the coming year.
AutoNation, the country's largest publicly traded automotive retailer, said it swung to a $1.41 billion loss in the third quarter from a profit of $72.1 million in the year-ago period, as customers found it harder to get car loans. Revenue fell 21 percent to $3.5 billion. The company recorded after-tax charges of $1.46 billion to write down the value of dealerships because of dwindling sales.
Anheuser-Busch said its third-quarter profit fell 5.7 percent, to $666.1 million from $706.7 million in the year-ago period, because of charges for its pending sale to InBev. Sales rose 6.5 percent, to $4.92 billion, and the nation's largest brewer had a slight gain in market share.
Blackstone Group, one of the world's largest private-equity funds, said its third-quarter loss widened to $340.3 million from $113.2 million a year earlier as the financial crisis lowered the value of its investments. .
Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.
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