Business & Finance
Tracinda Corp., billionaire Kirk Kerkorian's investment company, said it will buy 18.9 million shares of General Motors stock - down from its initial goal of 28 million shares. The announcement came a day after the world's largest automaker announced it will cut 25,000 jobs over the next three years to help revive its North American operations. With the purchase, Tracinda's stake in GM will increase from 3.89 percent to 7.2 percent, less than the 8.84 percent if the offer had been fully subscribed by its midnight Monday deadline. (Related story, page 1.)
NBC Universal completed its takeover of Vivendi Universal Entertainment by buying a 5.44 percent stake from media tycoon Barry Diller's IAC/InterActive Corp. The cash and stock deal was valued at $3.4 billion. NBC Universal is a conglomerate owned by General Electric and France's Vivendi Universal. IAC/Interactive owns Ticketmaster, Expedia, and other commercial websites.
Delta Air Lines and Northwest warned the Senate Finance Committee that pension obligations could drive their companies into bankruptcy and increase the burden on the federal Pension Benefit Guaranty Corp. Northwest chief Douglas Steenland said less than 60 percent of that carrier's pension benefits are funded; Delta's Gerald Grinstein said his company's pension plan is 75 percent funded. Without new legislation, each said his company could follow Untied and US Airways in terminating its defined pension-benefit programs.
The largest initial public offering so far this year has raised $2.9 billion for Chinese coal producer Shenhua Energy Co., Bloomberg.com reported. But analysts said response to the IPO was lukewarm, citing a leveling of coal futures prices as supply catches up with demand. Shenhua had planned to ask as much as $1.20 per share but ended up charging 96 cents. The company's reserves are second in size only to those of Peabody Energy Corp. of the US.
Furniture Brands International of Charlotte, N.C., said it will cut more than 1,200 jobs by Nov. 30 by closing and reconfiguring two well-known subsidiaries, Thomasville and Broyhill. The move is the result of stiff competition from foreign manufacturers.
Billerud AB, a leading maker of packaging papers, said it will lay off 450 employees as part of an effort to cut operating expenses by $34 million a year. The layoffs will begin immediately and will affect mills in Sweden and Britain. Billerud's headquarters are in Stockholm.