Business & Finance
Despite the $57 billion price tag of Proctor & Gamble's megamerger with Gillette Co., the companies say they expect the venture to be profitable in three years. But while new growth opportunities could add an estimated $14 billion to the bottom line, the combined companies will cut 6,000 jobs, or 4 percent of their overall workforce. The fusion creates a large stable of popular brand names, bringing together such products as P&G's Clairol, Crest, and Tide, with Gillette razors and shaving creams, Braun electric shavers, and Oral-B toothbrushes.
Comcast and Time Warner, the nation's two largest cable-TV operators, are expected to submit a joint bid of at least $14 billion by today's deadline for beleaguered rival Adelphia Communications Corp. Adelphia filed for bankruptcy in 2002 after senior executives were accused of looting the company and cheating investors. Founder John Rigas and his son, Timothy, have been convicted of conspiracy and fraud and await sentencing next month. While the company is up for auction, it still has 5.3 million subscribers and could choose to reject all bids and try to emerge from bankruptcy without a sale.
Boeing Co. scored the largest order to date for its new Dreamliner passenger jet - 60 planes for delivery to six Chinese airlines. The deal Friday with China Aviation Supply Co., a government agency that oversees the nation's carriers, has a book value of $7.2 billion, although a significant discount is expected to apply. Boeing said it expects to deliver at least some of the new planes to each of the customers in time for the 2008 Olympic Games in Beijing. The aircraft builder also announced that the new plane, originally designated 7E7, has been renamed 787.
Sister companies in the giant Mitsubishi Corp. agreed to put up another $5.2 billion Friday to try to save its deeply troubled automaker. The bailout of Mitsubishi Motors is the second in eight months and will be accomplished through a package of loans, asset sales, and the purchase of new shares. It brings to $10 billion the amount invested by the sister companies and raises their stake in the auto-maker to 34 percent. Japan's fifth-largest (and only unprofitable) car company said it expects to post a $4.6 billion loss for its fiscal year ending in March.
Despite three years of declining revenues, DaimlerChrysler announced it has sold a $1 billion stake to the government of Dubai. The emirate instantly becomes the German-American automaker's third-largest shareholder, although the size of the deal raised eyebrows among industry analysts, who generally rate other car companies as better investments. A spokesman for the government agency that bought the shares declined comment except to express confidence in DaimlerChrysler's management.