BUSINESS BRIEFING

Friday, January 2, 2009

MERGERS & ACQUISITIONS

Two Big Bank Sales Completed

Two mega acquisitions in the banking sector have been completed, with Bank of America closing its $19.4 billion all-stock purchase of Merrill Lynch and Wells Fargo concluding its $12.7 billion all-stock purchase of Wachovia.

Merrill Lynch's sale to Bank of America, announced Sept. 15, creates the nation's largest financial services company. Wells Fargo's purchase of Wachovia, announced Oct. 3, forms a coast-to-coast powerhouse with community banks in 39 states and the District.

Merrill Lynch shareholders received 0.8595 shares of Bank of America common stock for each common share of Merrill Lynch they owned. Wachovia shareholders received 0.1991 shares of Wells Fargo common stock in exchange for each share of Wachovia common stock they owned.

TELEVISION

Time Warner, Viacom Reach Deal

Millions of Time Warner Cable customers won't lose access to MTV and 18 other channels after the cable giant reached an agreement early yesterday with media conglomerate Viacom.

The two sides, citing disagreement over fee hikes, had threatened a damaging blackout at a minute past midnight Thursday that would have cut off shows such as "SpongeBob SquarePants," above, and "The Colbert Report" to about 15.7 million subscribers.

Terms of the deal were not disclosed. Details must still be finalized over the next few days, the companies said.

Viacom president and chief executive Philippe Dauman said the company was happy a deal was struck. Viacom had mounted an advertising onslaught warning customers of the possible blackout, taking out ads in major newspapers and Web sites.

EUROPE

Slovakia Adopts Euro Currency

Slovakia became the 16th country to adopt the European Union's euro -- a currency that also celebrated its 10th birthday yesterday. With the addition of Slovakia, the euro will be used by 330 million people with an annual gross domestic product of more than $5.6 trillion.

The decision by the nation of 5.4 million to join the eurozone and abandon the Slovak koruna appears even wiser amid the global financial crisis, as other European countries have seen their currencies severely buffeted.

Slovakia is adopting the euro as some people in E.U. members Denmark and Sweden are rethinking their countries' refusal to sign up. Meantime, Czech Prime Minister Mirek Topolanek said yesterday that his government will set a target date for the euro's adoption in November.

ENERGY

U.S. Fuel Tax Increase Urged

A 50 percent increase in gasoline and diesel fuel taxes is being urged by a federal commission to finance highway construction and repair until the government devises another way for motorists to pay for using public roads.

With people driving less and buying less fuel, the current gas tax of 18.4 cents a gallon and diesel tax of 24.4 cents a gallon do not increase enough to keep pace with the cost of road, bridge and transit programs.

In a report expected in late January, the National Commission on Surface Transportation Infrastructure Financing is expected to urge Congress to raise the gas tax by 10 cents a gallon and the diesel fuel tax by 12 to 15 cents a gallon.

Russia Halts Gas Supplies to Ukraine

Russia made good on its threat to cut off all natural gas supplies to Ukraine, but the two uneasy neighbors took great pains to make sure their contract dispute would not leave Europe short of gas just as winter set in.

Overshadowing their confrontation was the specter of 2006, when a similar dispute interrupted gas shipments to many European countries for three days. But both Russia and Ukraine now have strong interests in proving to Europe they can be reliable energy partners, and they assured other European nations that they would not be affected.

The cutoff was being closely watched in the European Union, which depends on Russia for about a quarter of its gas -- with some 80 percent of that delivered through pipelines controlled by Ukraine.

TECHNOLOGY

Microsoft Zunes Working Again

Many of Microsoft's Zune media players that froze up on the last day of 2008 because of a glitch involving their internal clock were functioning properly yesterday, according to the company. However, a few users were still complaining of problems operating the devices.

Microsoft spokesman Brian Eskridge said that based on responses from customers and his review of online message forums, affected users of the 30-gigabyte Zune model were not having further problems after fully recharging their devices and powering them on again.

But, by midmorning yesterday, a few people were still complaining on one online Zune forum about their devices not booting up. Most on the forum said their devices were working, and they encouraged those who were still having problems to be patient and let their devices fully charge before powering them on again.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.