Business & Finance
Ignoring a new pledge by OPEC cartel members to raise their production of crude, traders pushed futures prices above $57 per barrel for the first time on European exchanges. In the US, the American Automobile Association reported that the average retail price for unleaded regular gasoline also set a record - $2.055 per gallon - attributing the rise to growing demand for oil in China and India. The previous "intraday" record for future delivery of crude on European exchanges was $55.67 per barrel, set last October. In a statement from Iran, where they were meeting Wednesday, OPEC members said they'd hike production by a half-million barrels a day and could up it again by 500,000 barrels "if needed."
A deal to sell the entire Toys R Us business to a consor tium of investors for $5.7 billion was expected as the Monitor went to press. The buyers were identified as Vornado Realty Trust of New York and the private equity firms Bain Capital and Kohlberg Kravis Roberts. Toys R Us operates 975 toy stores and 216 Babies R Us outlets.
Qwest Communications upped the ante a third time for MCI - sweetening its offer from $8 billion to $8.45 billion. MCI, the former WorldCom, said its board would respond to the latest bid by March 28 although it remains committed for the time being to a $6.7 billion buyout by Verizon. Some analysts doubt that Qwest has the financial resources or stability needed to land MCI.
By agreeing to a $2 billion settlement, JPMorgan Chase became the last major bank to resolve claims in a class-action suit brought by investors who lost money in the collapse of WorldCom. In all, more than a dozen WorldCom lenders have agreed to reimburse the investors by upwards of $6 billion, a record for such litigation. The settlement came as former WorldCom chief Bernard Ebbers was found guilty of fraud, conspiracy, and false regulatory filings in the company's $11 billion accounting fraud.
In a deal valued at $1 billion, Seabulk International Inc. agreed to be acquired by Seacor Holdings of Houston. The former, based in Fort Lauderdale, Fla., ships oil and specialty chemicals via tankers and barges, provides support services for offshore drilling platforms, and operates tugboats in southeastern ports. Seacor duplicates some of the same services but also maintains environmental response teams in the Western Hemisphere and Europe in case of accidents resulting in oil spills.
IBM confirmed reports that it will lay off 500 employees as it halts operations in five Swedish cities. But a spokeswoman wouldn't comment on speculation that the affected jobs are to be transferred to low-wage countries in Asia.