Business & Finance
Wal-Mart Stores Inc. said it will buy back up to $10 billion in stock, replacing a $7 billion buy-back plan in anticipation of changes in Standard & Poor's 500 stock index. The new methodology is expected to lower the weightings of major companies whose owners and inner circles hold on to large blocs of shares. Under the new system, weightings will be assigned according to the value of a company's stock that is actually available to be traded. The change could lead to a sale of about 159 million Wal-Mart shares, representing $8.4 billion of turnover, market analysts said.
IBM announced agreement in principle to settle a class-action lawsuit relating to its pension plan. The deal, reached Wednesday, is still subject to court approval. It provides that plaintiffs would be eligible to receive an incremental pension benefit worth about $300 million, reports said. IBM's potential liability is capped at $1.4 billion.
General Mills, the breakfast-cereal giant, announced that all of its brands soon will be made from whole grain and will be repackaged to reflect the change. Consumers will begin seeing the phase-in within weeks, the company said. The move, hailed by nutritionists as the possible start of a trend in the industry, will affect Trix, Cocoa Puffs, Lucky Charms, Rice Chex, and Golden Grahams. Its Wheaties, Cheerios, Total, and Wheat Chex brands already are made from whole grain. General Mills is the No. 2 maker of cereals, behind Kellogg Co., but is believed to be the first nationally prominent food manufacturer to switch exclusively to whole grain products.
In a new round of layoff announcements:
• Continental Tire North America Inc. will close its Mayfield, Ky., plant by Dec. 31 after failing to agree on a new contract with the United Steelworkers of America. The plant employs 985 people. A spokesman for the Charlotte, N.C., company said it was unable to achieve sufficient concessions from workers to make the plant cost-effective.
• The largest operator of travel agencies, hotels, and support services for tourists in Europe, TUI AG of Germany, said it will cut 800 jobs by year's end. All of those affected will be in Britain, it said.
• Belo Corp., the owner of The Dallas Morning News and other media outlets in 10 states, said it will cut 250 jobs by Nov. 1 due to flat revenues. Belo said the layoffs are unrelated to a circulation scandal at the Morning News, where a rewards program led employees and independent contractors to inflate the number of papers sold.