Royal Dutch/Shell said it will hike spending to $15 billion a year between now and 2006 to explore for oil and natural gas to replenish the reserves it has admitted to overstating. But chairman Jeroen van der Veer told a news conference in London Tuesday that the company also will try to recover from one of the most turbulent years in its history by selling off as much as $12 billion worth of assets. It already has announced plans to divest itself of oil fields in Angola, pipelines in the US, and gas stations in Spain. More recently, it has been approached by a potential buyer of its liquid petroleum gas business, Bloomberg.com reported.
Interstate Bakeries Inc. filed for bankruptcy in Kansas City, Mo. The company, which makes Twinkies as well as cakes and breads for such brands as Sunbeam, Drake's, and Home Pride, is more than $1 billion in debt, partly because of low-carbohydrate diets, which have reduced demand for its products. Other factors, such as increased competition and rising energy costs and employee pension obligations, have led to the closing of some of Interstate's 54 plants during the past year.
PeopleSoft, Inc., the second-largest supplier of software for corporate applications, announced a closer relationship with IBM that could boost sagging sales and help the company thwart Oracle Corp.'s $7.7 billion hostile take-over bid. The five-year, $1 billion joint venture is aimed at greater integration of different layers of software so that customers can retrieve information from computers more efficiently. The announcement came less than two weeks after an antitrust court ruling cleared the way for Oracle to accelerate its relentless pursuit of PeopleSoft.
Adelphia Communications, the troubled cable TV provider, said it plans to sell its assets in seven geographic clusters as it emerges from bankruptcy. Chairman Bill Schleyer said that subdividing the company into stand-alone entities should help to maximize value for creditors and other stakeholders. Analysts and creditors have estimated the company's value at between $17 billion and $23 billion, and the Financial Times said prospective buyers could include rivals Time Warner, Comcast, and Charter Communications. Adelphia founder John Rigas and his son, Timothy, were accused of cheating investors out of billions of dollars, and a jury in July found them guilty of conspiracy and fraud.