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Matsushita Electric Industrial Co Ltd <MC.T> said it would launch the worlds smallest and lightest personal-use plain paper copier (PPC) on the domestic market in early June. It said the 69800 yen copier is 367 mm by 407 mm by 120 mm weighs six kilos and can copy pictures from television and VCRs with an optional adaptor. The company plans to produce 2000 sets a month and will eventually export them it said without providing further details. Total Japanese PPC output rose 12 pct to 560000 units in 1986 and is projected to rise to 610000 this year it said. REUTER | MATSUSHITA TO LAUNCH PORTABLE COPIER |
The five leading West German economic research institutes have failed to agree about how strongly the domestic economy will expand this year but revised down forecasts contained in a report published six months ago. The three research groups of Kiel Hamburg and Essen predicted in the institutes joint spring report that gross national product (GNP) would rise by two pct in 1987 compared with 2.4 pct in 1986. The five institutes had jointly forecast three pct 1987 growth in October last year. Taking a dissenting view the DIW institute of West Berlin and Munichs Ifo institute predicted only one pct 1987 growth. The joint report said that the estimates of economic development made by the DIW and Ifo were markedly less favourable than those of the other three. The DIW and Ifo forecast the economy would pick up after a slow start to the year. In the second half of 1987 there will however only be a weak upward movement they said. The two institutes said external economic factors which were currently damaging exports and pushing up imports would dominate the economic environment throughout the year. They saw exports falling by a real 2-1/2 pct in 1987 and predicted no marked improvement in the course of the year. The other three institutes however wrote: The decline in demand and production (seen) in the winter months does not indicate the beginning of a cyclical downswing. They said the sharp rise of the mark had led to corporate uncertainty and companies had not carried out investment plans. But they expected that many investments had not been cancelled but only put off. It can be presumed that the braking actions (on the economy) will diminish markedly this year. They added: The domestic prerequisites for a continuation of the economic uptrend are still favourable. These three institutes said diminishing external burdens combined with favourable domestic conditions meant an upturn in demand and production could be expected by the spring. However this projection was clouded by risks including the further development of the mark against the dollar. Contrary to the DIW and Ifo the three institutes said that while exports would continue to be the weak point of the economy in 1987 there is good reason to believe that exports will soon bottom out and that a slight rise will emerge during the course of the year. They predicted an overall 0.5 pct fall in exports in 1987 the same as in 1986. The three more positive institutes saw private consumption rising by four pct in 1987 compared with 4.2 pct in 1986 while DIW and Ifo predicted a three pct increase. They saw the climate for equipment investment improving but predicted only a rise of four pct in 1987 against 4.6 pct in 1986. Ifo and DIW saw these investments rising by only two pct. All the institutes predicted only a slight decline in unemployment. The Kiel Hamburg and Essen institutes said the jobless total would average 2.17 mln in 1987 compared with 2.23 mln in 1986 and predicted a rise in the number of people in work of about 200000. These three institutes said new jobs would be created mainly in the private services sector and also by the state in the context of job creation measures. The construction industry was likely to engage new workers for the first time since 1980 but they predicted either no rise in employment in the manufactured goods industry or only a slight expansion. The DIW and Ifo said rises in employment would occur only in the tertiary sector while the number employed in the manufacturing industry will decline. The DIW and Ifo said unemployment would only decline to 2.20 mln in 1987 from 2.23 mln in 1986. They saw the current account surplus falling in 1987 to 58 billion marks from 78 billion in 1986. The other three saw a current account surplus in 1987 of at least 60 billion marks and predicted that the trade surplus would fall to only around 100 billion marks from 112 billion in 1986. The institutes agreed that consumer prices would start to rise in 1987 after they declined in 1986 and all five predicted an average increase over the year of 0.5 pct. REUTER | INSTITUTES DIVIDED ON OUTLOOK FOR GERMAN ECONOMY |
<Blue Arrow Plc> said it had agreed terms to acquire a group of U.S. Companies collectively known as the <Richards Companies> which specialise in executive recruitment and management consultancy on personnel matters. The total consideration will be 29 mln U.S. Dlrs of which 50 pct will be payable in cash and 50 pct by the issue of 1.36 mln new ordinary shares in Blue Arrow. The Richard Companies made a pre-tax profit of 3.6 mln dlrs in the year to end-1986 on turnover of 7.1 mln dlrs with net tangible assets at the end of 1986 of 3.4 mln dlrs. Blue Arrow shares were trading 9p lower at 670 this morning. REUTER | BLUE ARROW TO BUY U.S. RICHARDS COMPANIES |
The State Bank of Victoria is raising 50 mln Australian dlrs through a three-year bullet eurobond at 14-1/2 pct and priced at 101-3/8 lead and sole manager Commerzbank AG said. The bond is due on May 15 1990 and interest is paid on that date annually. Payment date is also May 15. Denominations are 1000 and 10000 dlrs and listing is in London. Fees total 1-1/2 pct with a half-point for management and underwriting and one point for selling. REUTER | VICTORIA STATE BANK ISSUES 50 MLN AUS DLR EUROBOND |
Saudi riyal interbank deposit rates surged across the board as banks tried to build long positions in anticipation of a further rise in U.S. Interest rates dealers said. They said traders expected riyal deposits to follow the recent strong rise in eurodollar rates sparked by fears of a tighter U.S. Monetary policy to halt the dollars slide. There was a wave of panic buying early in the morning as people tried to cover gaps and build long riyal positions said one dealer. As a result riyal deposits were strongly bid and traders scrambled for any available offers. One-way trade focused mainly on the fixed periods but short dates also rose dealers said. Spot-next and one-week deposits climbed to 6-5/8 1/8 pct from 6-3/8 six on Sunday. One-month deposits rose to 6-1/2 3/8 pct from 6-1/4 six and three-month deposits climbed to 6-3/4 5/8 pct from 6-9/16 7/16. Six-month deposits also firmed to 7-1/8 seven pct from 7-1/16 6-7/8 on Sunday. The spot riyal was steady at 3.7500/03 to the dollar after quotes of 3.7498/7503 yesterday. REUTER | SAUDI RIYAL DEPOSITS SURGE ON U.S. RATE RISE |
Gold bullion continued to move higher supported by good general buying and was fixed this morning at 436.50 dlrs 268.368 stg an ounce up from Fridays close of 432.00/50 dealers said. The setting was the highest since October 8 as gold built on Fridays gains which had been based on the weakness of the dollar and fears of a trade war between the United States and Japan. It opened slightly firmer at 433.50/434.00 and moved up steadily during the morning supported by commission house and trade buying dealers said. Dealers said there was resistance around 440.00 but with sentiment still firm some traders believe the rally may even take gold as high as 500 dlrs. Platinum was fixed this morning at 583.50 dlrs an ounce up from Fridays close of 578.50/580.50 and also the highest setting since October. REUTER | LONDON GOLD MORNING FIX HIGHEST SINCE OCTOBER |
Borg-Warner <BOR> Corp facing an unwanted offer from GAF Corp <GAF> agreed to a 4.23 billion dlr buyout offer from a company to be formed by <Merrill Lynch Capital Partners Inc>. Borg-Warner and Merrill said yesterday they entered a definitive merger agreement under which a subsidiary of the new company <AV Holdings Corp> will begin a 48.50 dlr per share cash tender offer today for 77.6 mln shares or 89 pct of Borg-Warner common stock. The offer will be followed by a merger in which each remaining share will be converted into 19.75 dlrs cash and 54.25 dlrs principal amount of AV Holdings junior subordinated discount debentures. As a result of the merger Borg-Warner will become a wholly owned subsidiary of AV Holdings. A Borg-Warner spokeswoman said members of management do not plan to participate in the transaction but they will retain their positions with the company. A spokesman for GAF was unavailable for comment. GAF holds 19.9 pct of Borg-Warners shares. GAF had said it would offer 46 dlrs per share. Borg-Warners spokeswoman said the company still plans to sell its financial services unit which includes Wells Fargo security guards and the Chilton Corp a credit rating service. Borg-Warner has been the focus of takeover speculation for about a year. Corporate raider Irwin Jacobs last year proposed a takeover of the firm and until recently held 10 pct of the stock. Following the GAF offer analysts had calculated breakup values for the company in the low 50 dlrs per share range and speculated an offer would have to be sweetened. In its statement Borg-Warner said its board endorsed the Merrill offer and it recommended that shareholders tender their shares. The board received opinions on the offer from its advisors First Boston Corp and Goldman Sachs and Co. James Burke president of Merrill Lynch Capital Partners said We are very pleased to have entered into this transaction with Borg-Warner. We are looking forward to working with the employees of Borg-Warner and to Borg-Warner maintaining its strong presence in the Chicago community. Merrill Lynch will be the dealer-manager for the offer which expires at midnight EDT May 8 (0400 GMT May 9) subject to conditions including the completion of necessary financing arrangements. The offer is also subject to a minimum 44.25 mln shares or 51 pct of the outstanding shares being tendered. Merrill Lynch and certain affiliates have committed to provide 200 mln dlrs in AV Holdings equity and 870 mln in subordinated financing and forward underwriting commitments. Merrill Lynch said that following discussions with commercial banks it is confident it can obtain the rest of the financing required to complete the transaction. The junior subordinated discount debentures to be issued in the merger will carry a 13 pct coupon and will begin paying cash interest after five years. The debentures will be redeemable at the companys option for the first six years at 105 pct during the seventh year at 102.5 pct and after that at 100 pct of the principal amount. The junior subordinated discount debentures have a maturity of 20 years and are entitled to a sinking fund commencing in the 16th year designed to retire 60 pct of the issue before maturity. Borg-Warner will also redeem all of its outstanding 4.50 dlrs cumulative preferred stock series A for 100 dlrs per share. Holders who wish to participate in the offer must first convert their preferred stock into Borg-Warner common stock. The board of Borg-Warner has also taken steps to redeem its poison pill or share purchase rights for five cents per right effective immediately. REUTER | BORG-WARNER AGREES TO BUYOUT BY MERRILL LYNCH FIRM |
The price index for sales of manufactured goods in the U.K. Rose a provisional unadjusted 0.3 pct in March after an identical rise in February Department of Trade and Industry figures show. The index for materials and fuel purchased by manufacturing industry fell a provisional and unadjusted 1.1 pct after a 1.7 pct fall in February. The Department said the year-on-year rise in producer prices in March was a provisional 3.7 pct compared with a provisional 4.2 pct increase in the year to end-February. The index for output prices non-seasonally adjusted was put at a provisional 149.7 in March after 149.3 in February. The index for input prices also not seasonally adjusted was set at 128.2 in March after Februarys 129.6. The 1.1 pct fall in input prices between February and March was mainly due to a seasonal fall in industrial electricity costs and lower scheduled prices for petroleum products the Department said. The Department said these falls were only partly offset by a rise in prices of home-produced food manufacturing materials. The seasonally adjusted index for input prices showed a 0.2 pct rise between February and March. Year-on-year the input price index was down 0.7 pct in March after a 2.8 pct drop in February. REUTER | U.K. MARCH PRODUCER PRICES RISE 0.3 PCT |
Sri Lankas cabinet has ordered a 12 pct cut in budget spending by ministries this year to offset the rising cost of the fight against Tamil guerrillas Finance Ministry officials said. A senior economist at the Ministry who declined to be named told Reuters the cuts would not apply to defence-related Ministries and those involved in health and education. Defence expenditure projected at 10 billion rupees this year is now forecast at 12 billion and is expected to exceed this by the year-end. The economist said the cuts were part of a government plan to reduce spending to satisfy the International Monetary Fund (IMF) which has promised to lend Sri Lanka 6.5 billion rupees to help its balance of payments. The IMF has said previously Sri Lanaka must reduce its budget and balance of payments deficits to satisfy loan conditions. He said World Bank and IMF teams were expected here next month. If approved the loan would be available only after November and would be part of the 1988 budget he said. REUTER | SRI LANKA ORDERS BUDGET CUTS AS DEFENCE COSTS RISE |
Norways state oil company Den Norske Stats Oljeselskap A/S (Statoil) <STAT.OL> has told Thai authorities it is interested in taking a 30 pct share in a big offshore Thailand gas field Statoil said. The field in the southern sector of the Gulf of Thailand is currently operated by U.S. Oil company Texas Pacific Oil Co Inc a unit of Canadas Seagram Co Ltd <VO.N>. Thailands state oil company <Petroleum Authority Thailand> (PTT) also holds a major stake in the field. PTT wants to develop the field and has asked Statoil to consider co-development if the fields licence is renewed. PTT according to Statoil is currently negotiating with Texas Pacific to buy back the Dallas-based oil companys holdings in the field. PTT must first sort out its problems with Texas Pacific. When this is done we have said we are interested in taking over a 30 pct share in the field Statoil spokesman Willy Olsen told Reuters. Statoil hired by PTT to carry out an independent appraisal of the fields reserves and propose a development plan has estimated the field could be commercially developed at a cost of some 700 mln crowns. Industry sources said Texas Pacific has submitted lower reserve estimates for the field than Statoil and shown little interest in its development. Statoil refused to disclose its upgraded reserve estimate for the field. The fields reserves could be sold domestically through Thailands gas distribution network or by converting the gas to electricity the sources said. Sources would not say which field Statoil is considering. REUTER | STATOIL SEEKS SHARE IN THAI GAS FIELD |
The New South Wales Treasury Corporation is issuing a 100 mln Australian dlr eurobond due May 27 1992 paying 14-1/4 pct and priced at 101-7/8 pct lead manager County Natwest Capital Markets said. The non-callable bond is guaranteed by the crown-in-right of New South Wales. The selling concession is 1-3/8 pct while management and underwriting combined pays 5/8 pct. The issue is available in denominations of 1000 and 10000 Australian dlrs and will be listed in Luxembourg. The payment date is May 27. REUTER | TREASURY CORP OF NSW ISSUES AUSTRALIAN DLR BOND |
The ruling Liberal Democratic Partys (LDP) setback in Sundays nationwide local elections may force the government to water down its controversial proposal for a five pct sales tax and undermine its commitment to stimulating the economy private economists said. The LDPs failure to win seats in some crucial local constituencies will weaken the governments ability to push through its tax plan and without a compromise tax proposal the budget for fiscal 1987/88 ending March 31 is unlikely to be passed soon they said. Without the budget the government would also be hard-pressed to come up with an effective package to stimulate the economy as pledged at Group of Seven meetings in Paris in late February and in Washington last week they said. Opposition protests against the sales tax have stalled parliamentary debate on the budget for weeks and forced the government to enact a stop-gap 1987/88 budget that began early this month. The LDPs election setback will have an enormous impact on the already faltering economy said Johsen Takahashi chief economist at Mitsubishi Research Institute. Takahashi said that behind the LDPs poor showing was public discontent with the governments high-handed push for tax reform and its lack of effective policies to cope with economic woes caused by the yens appreciation. This explains why the LDP failed to regain governorships in the most hotly contested constituencies of Fukuoka and Hokkaido where the shipbuilding and steel industries are suffering heavily from the yens extended rise he said. Takahashi said the government should delay introduction of the sales tax for one or two years beyond its original starting date of January 1988 and implement tax cuts now. Sumitomo Bank Ltd chief economist Masahiko Koido also said he favours watering down the proposed sales tax while suggesting the government boost public works spending by modifying its tight fiscal policies. The local election results were a signal the economy now needs government action to take clear-cut fiscal measures he said adding that such moves would help the world economy as well as Japans. For the last five years or so the government has stuck to a tight fiscal policy in a bid to halt the issue of deficit financing bonds by fiscal 1990/91 economists said. If the LDP election setback leads to a scaled down sales tax proposal the government would have to find other revenue sources to help finance the planned tax cuts and a package of measures to stimulate the economy the economists said. Koido said the government could raise additional revenue by selling shares in public corporations such as Nippon Telegraph and Telephone Corp. But it should issue additional bonds to ensure a more stable source of funds he said. It may run counter to its avowed policy of balancing the budget but it can do so on a short-term basis he said. Takahashi of Mitsubishi Research also agreed with the need for the government to float more bonds to raise funds needed for economic expansion. He said additional government borrowing would place no burden on the capital market because it has amassed huge excess funds and government bond prices have risen to record levels lately. The market is just waiting for more new government bond issues he said. REUTER | ELECTION RESULT MAY DELAY JAPAN ECONOMIC STIMULUS |
Japanese oil traders and refiners are considering whether to suspend further business with Texaco Inc <TX> which yesterday filed for protection under Chapter 11 of the U.S. Bankruptcy code industry sources told Reuters. Texaco the third biggest U.S. Oil company said it filed to protect itself from creditors while it fights a legal battle with Pennzoil Co <PZL> over the purchase of Getty Petroleum Corp <GTY> in 1984. Many Japanese trading houses decided to stop dealing with Texaco several months ago as rumours it was about to file for bankruptcy spread through the market the sources said. We havent dealt with them for six months said one Japanese trader. Some Japanese trading houses with offices in the U.S. May ask for letters of credit if they decide to continue trading with Texaco oil sources said. They said Texaco which said its bankrupcty protection measure will not affect the majority of its businesses may find industry reaction stronger than anticipated. Texaco tried to buy substantial volumes of gasoline on the U.S. Gulf on Friday but no one offered to them one trading house source said. One U.S. Major is reviewing its relationship with Texaco and an international oil trading company while continuing limited transactions with Texaco will send its lawyers to meet with the company tonight in New York oil sources said. But one Japanese oil company which holds several joint venture oil exploration interests with Texaco said business would continue as usual pending the outcome of the dispute a company spokesman said. REUTER | SOME JAPAN OIL FIRMS MAY STOP TRADING WITH TEXACO |
French commercial bank Credit Commercial de France has split each of its shares into four to increase the number of shares on offer when it is privatised at the end of this month a company official said. He told Reuters a general assembly had passed a proposal splitting 10.33 mln shares of 100 francs nominal into around 41.32 mln shares of 25 francs nominal. Market sources have put the total value of CCFs selloff at between four and five billion francs. The bank said the share sale price was likely to be announced on April 24 before the launch of a public flotation offer on April 27. REUTER | CREDIT COMMERCIAL DE FRANCE SPLITS SHARES |
The five leading West German economic research institutes said the government should do more to stimulate economic growth and called for early introduction of tax cuts planned for 1990. In their joint spring report the institutes were divided about 1987 growth forecasts with three predicting two pct expansion and the other two only one pct growth. Gross national product grew 2.4 pct last year. But the report said all the institutes believed that more must be done to produce dynamic growth so that more additional jobs can be created. The institutes said any step which improved basic economic conditions should be taken as quickly as possible. From this point of view the tax reform planned for 1990 should be brought forward. The government plans gross tax reductions of 44 billion marks as part of the major tax reform. The net tax relief from the tax reform will amount to 25 billion marks. However the institutes criticised the government not only for the timing of the reform but also because the question of its financing had been left open. The government has not specified how the remaining 19 billion marks of the tax reduction package will be paid for though it has said it wants to cut state subsidies. The institutes said this lack of clarity from Bonn had caused uncertainty among companies and households as to what exactly they would receive from the tax reform and urged a quick decision from the government. They also said the government should reduce tax preferences which would simplify the fiscal system urged a restriction of state spending and called for no increase in value-added tax. The institutes also criticised Bonn for increasing subsidies at a time further reductions had been pledged. They referred specifically to a doubling of special writedowns for small and medium sized companies announced in a package of tax adjustments planned for 1988 and described this as an increase in subsidies. The institutes said total subsidies including tax preferences had reached 80 billion marks in 1985 and risen further since then. Given the scope of these subsidies it should be possible despite ... Major political difficulties to finance the tax reform by cutting state handouts. The institutes said that if the government raised value added tax or other indirect taxes a large portion of the positive effects resulting from lower taxes would be lost. The report also noted that the government was progressing only slowly with its plans to privatise state companies and said more deregulation was needed. The government had to aim for more competition it said. REUTER | WEST GERMAN INSTITUTES CALL FOR EARLY TAX CUTS |
Glaxo pre-tax profit 376 mln stg vs 260 mln in six months to end-December |
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Hillsdown Holdings Plc <HLDN.L> said its Christie-Tyler Ltd unit would buy the European bedding making interests of Simmons Co U.S.A. Owned by Gulf and Western Industries Inc USA <GW> for 23 mln dlrs. The acquisitions include <Sleepeeze Ltd> in the U.K. <Compagnie Continentale Simmons SA> in France and <Compagnia Italiana Simmons SpA> in Italy. In 1986 the three businesses made pre-tax profit of around 2.5 mln stg on sales of 39 mln stg. Net assets being acquired come to around nine mln stg. Hillsdown shares were unchanged at 266p. REUTER | HILLSDOWN BUYS BEDDING COMPANIES FOR 23 MLN DLRS |
The European Community (EC) has effectively given Japan six weeks to take moves to open its market to imports before it decides on possible tough retaliatory trade measures EC diplomats said. They said EC foreign ministers will meet on May 25 and 26 to review the state of trade relations between the two sides. The EC executive commission was asked by representatives of member states on Friday to propose a renunciation of some EC pledges to the world trade body GATT unless there are adequate and early measures to open the Japanese market. Such a renunciation would be the first step to imposing stiff increases in duties or quantitative limits on Japanese exports. The diplomats said it was unlikely that the issue would be discussed in detail at the next meeting of EC foreign ministers on April 27 and 28 in Luxembourg as time was needed to prepare proposals for possible retaliatory action. They said the commission has powers to take some limited action before getting ministerial approval to prevent Japanese exports of electrical photographic and other goods being diverted to Europe in the wake of possible U.S. Tariff moves. In May the ministers are also likely to discuss how to prevent Japan from getting an extra trading advantage as a result of Spain and Portugal joining the bloc which obliges them gradually to reduce tariffs on many industrial goods. Meanwhile Japans trade surplus with the Community has grown steadily registering a record 2.13 billion dlrs in March. REUTER | EC COULD DECIDE ON JAPAN TRADE MOVES IN LATE MAY |
Six months to end-December Shr 32.6p vs 22.3p Div 5.0p vs 4.0p Pre-tax profit 376 mln stg vs 260 mln Turnover 883 mln vs 686 mln Tax 133 mln vs 94 mln Note - company full name is Glaxo Holdings Plc <GLXO.L>. Trading profit 338 mln vs 233 mln Share of profits of associates 14 mln vs seven mln Investment income less interest payable 24 mln vs 20 mln Profit after tax 243 mln vs 166 mln Minority interests two mln vs one mln Extraordianry credit eight mln vs nil Turnover includes - Continuing activities 875 mln vs 647 mln Discontinued activities eight mln vs 39 mln U.K. 111 mln vs 91 mln Europe 299 mln vs 218 mln North America 334 mln vs 229 mln Central and South America 21 mln vs 20 mln Africa and Middle East 29 mln vs 23 mln South East Asia and Far East 57 mln vs 47 mln Australasia 24 mln vs 19 mln Anti-peptic ulcerants 414 mln vs 285 mln Systemic antibiotics 112 mln vs 82 mln Respiratory system 183 mln vs 141 mln REUTER | GLAXO PROFITS UP SHARPLY, DIVIDEND RAISED |
A takeover battle began today for debt-burdened Dome Petroleum Ltd <DMP.MO> as TransCanada PipeLines Ltd <TRP.TO> announced a 4.3 billion dlr offer and Dome said it is continuing talks with other possible buyers. Companies mentioned in market speculation as potential buyers for Dome include Imperial Oil Ltd <IMO.A> which is 70 pct owned by Exxon Corp <XON.N> <PanCanadian Petroleum Ltd> which is 87 pct owned by the conglomerate Canadian Pacific Ltd <CP.N> and British Petroleum Co Plc <BP.L>. Along with the TransCanada offer Dome has had another proposal from a substantial company and discussions with a third company which could lead to an offer Dome said in a statement. The statement confirmed Dome received TransCanadas bid but did not identify the companies involved in talks. TransCanada Canadas largest natural gas pipeline operator said it is offering Dome a package of cash common and preferred shares and shares in a new subsidiary which would own and operate Domes assets. TransCanada said the offer is to Dome management not to shareholders. Dome has massive oil and gas landholdings in Canada totalling 36.1 mln acres of which 7.4 mln have been developed. It also has tax credits worth about 2.5 billion dlrs. Domes statement said the TransCanada announcement violated the terms and spirit of a confidentiality agreement entered into with prospective purchasers and was apparently timed to prevent Dome from considering other proposals. It said the TransCanada bid seems to require favourable and substantial taxation concessions from the federal and provincial governments. But Dome added that its management and financial advisers will evaluate all proposals. TransCanada chief financial officer H. Neil Nichols said he was surprised at the vehemence of Domes statement and denied that TransCanada was trying to usurp other bids. I find (Domes statement) very bothersome. Once the board made the decision to authorise the proposal it had a legal obligation to announce it he said. Nichols said he did not know the identity of the other bidders or the terms of other offers. Dome common shares closed at 1.13 dlrs on Friday on the Toronto Stock Exchange. The preferred class A stock closed at 5.00 dlrs. Common stock traded as high as 25.00 dlrs in 1981. REUTER | TAKEOVER BATTLE FOR DOME PETROLEUM BEGINS |
The Bank of Japan will sell 800 billion yen in deficit financing bills today through 51-day repurchase agreements maturing June 3 to help absorb a projected money market surplus money traders said. The operation will raise the outstanding supply of the bills to a record 4800 billion yen. The yield on the bills for sale to banks and securities houses from money houses will be 3.8999 pct compared with the two-month commercial bill discount rate today of 3.8750 pct and the two-month certificate of deposit rate of 4.13/00 pct. The traders estimated the surplus today at about 1800 billion yen. They said it is mainly due to 1300 billion yen of government tax allocations to local governments and public entities and to excessive banking system cash holdings due to continuous large central bank dollar purchases. REUTER | BANK OF JAPAN TO SELL 800 BILLION YEN IN BILLS |
Italian state-owned bank Banca Commerciale Italiana BCI said it and Mediocredito Centrale will sign a joint venture pact with Soviet central bank Gosbank and Vneshtorgbank the foreign trade financial institution. A BCI spokesman told Reuters the agreement involves the banks providing financial services and taking equity stakes in joint Soviet-Italian industrial ventures. Under the agreement the Italian banks will have a 50 pct interest in a new firm to be formed by the four institutions. The accord is expected to be signed today or tomorrow at a Venice conference on East West trade the spokesman said. The spokesman said the joint venture company will operate primarily in the corporate finance sector. Additional details about the firms activities were not available he said. BCI is Italys second largest bank while Mediocredito provides medium-term export financing. REUTER | ITALIAN BANKS TO SIGN ACCORD WITH SOVIET BANKS |
The London Metal Exchange (LME) has issued a note clarifying details on its new high grade aluminium contract in response to questions from members following the announcement of the contract due to start June 1. All deliverable shapes of aluminium under the high grade primary aluminium contract (minimum 99.7 pct purity) will also be deliverable against the standard primary aluminium contract (min 99.5 pct) the LME said. Sows will not constitute good delivery against the standard contract until September 1 and 99.5 pct purity sows are not good delivery and cannot be placed on LME warrant. The dollar quotation for the high grade contract will be in multiples of one U.S. Dollar but carries may be made at 50 cents for even tonnages only. Singapore which is the first port warehouse outside Europe to be used as an LME delivery point will be used for high grade metal only and the rent imposed by owners Steinweg will be 1.05 U.S. Dlr a tonne per week the LME said. The LME Board in response to representation from the trade agreed to annul from LME contracts the minimum weight requirements of 450 kilos for T-bars and 250 kilos for sows effective for high grade on June 1 and for standard on July 24. REUTER | LME CLARIFIES NEW ALUMINIUM CONTRACT DETAILS |
The yield on 91-day bankers security deposit accounts issued this week by the Saudi Arabian Monetary Agency (SAMA) rose to 6.43896 pct from 6.21563 a week ago bankers said. SAMA lowered the offer price on the 500 mln riyal issue to 98.39844 from 98.45313 last Monday. Like-dated interbank deposits were quoted today at 6-3/4 5/8 pct. SAMA offers a total of 1.9 billion riyals in 30 91 and 180-day accounts to banks in the Kingdom each week. REUTER | YIELD ON 91-DAY SAMA DEPOSITS RISES |
Japanese Prime Minister Yasuhiro Nakasones unpopular plan to introduce a sales tax caused an electoral setback for his ruling Liberal Democratic Party (LDP) in Sundays local elections political analysts said. The LDP retained its 11 prefectural governorships but failed to restore a governorship in Fukuoka it had placed much importance on winning. In the prefectural assembly elections to fill 2670 seats the LDP has so far lost 92 of its previously held 1487 seats to the socialists and communists. Full election results should be available later today. Discussing the election results with reporters Nakasone said I wouldnt say the proposed five pct sales tax had no effect at all but there were other factors such as a low turnout and unusually cold weather. The Home Affairs Ministry said the average turnout for the 13 gubernatorial elections was a record low 59.78 pct while the prefectural assembly polls drew an average of 66.66 pct also a record low. Noboru Goto president of the Japan Chamber of Commerce and Industry and a longtime friend of Nakasone told reporters the impact of the sales tax on the LDPs setback was obvious. The government should take action (on the sales tax) in regard to the peoples wishes Goto said. Nakasone and other LDP leaders have already hinted at a delay in the implementation of the tax which had been scheduled for next January and a possible cut in the rate. The most important thing now is to get parliamentary approval of the budget as soon as possible to arrest a rapid appreciation of the yen Nakasone said. We must implement measures to prop up the economy. Opposition parties said the elections were a referendum on the tax and they will continue to demand its retraction. REUTER | NAKASONE'S PARTY SUFFERS SETBACKS IN LOCAL POLLS |
A Ministry of International Trade and Industry (MITI) official denied a local news agency report that Japan will end its seven-month-old semiconductor agreement with the U.S. If Washington imposes tariffs on 300 mln dlrs worth of Japanese electronic goods from April 17. Kyodo News Agency reported a high-ranking MITI official as saying Japan would end the chip pact if the U.S. Implements the punitive tariffs. Nothing new has been decided the official said. As MITI said on Saturday Japan would only pursue its rights under the General Agreement on Tariffs and Trade (GATT) he added. REUTER | JAPAN DENIES REPORT IT MAY END CHIP PACT WITH U.S. |
Eurobonds for Texaco Inc subsidiaries were unquoted this morning as traders assessed the implications of the companys shock weekend decision to file for bankruptcy under Chapter 11 of U.S. Bankruptcy laws eurobond dealers said. The decision to file for bankruptcy follows a court decision that it had to post an 11 billion dlr bond to continue its court battles with Pennzoil Co <PZL>. One head trader at a U.S. Securities house said I dont want to be obstructive but there genuinely is no market in Texaco bonds at the moment. Everyone is stunned by the decision (to file for bankruptcy) and cant really believe it. One dealer noted that Texaco subsidiaries have outstanding eurobonds totalling over three billion dlrs out of total borrowings of some 6.8 billion dlrs. He added that many of the fixed interest eurobonds - dollar straights - had been trading basis only for some time prior to this weekends news. This means traders could quote a two way price for the bonds but would not be bound to trade them. Any trades would be negotiated. He said that recently there appeared to have been some speculative buying of the bonds from the U.S. But that European investors had been overall sellers. Dealers noted that under the Chapter 11 filing noteholders will receive no interest payments. Texaco also has eurobonds outstanding which are convertible into Texaco Inc common stock - known as convertibles. Trading did not open in these issues either. One convertible dealer said Were waiting to see the result of todays court hearing. Texaco is applying today in the Texas courts for relief from having to post the court bond. Texaco shares were being indicated by over the counter share dealers here at around 26 to 28 dlrs compared with Fridays close in New York of 31-7/8 dlrs. Pennzoil shares were indicated at 85 to 87 dlrs compared with Fridays New York finish of 92-1/4 dlrs. REUTER | TEXACO <TX> EUROBONDS UNQUOTED AT MARKET OPENING |
U.S. Legislators called on Japan to open its financial markets to more foreign participation and boost its efforts to head off growing U.S. Protectionism a Foreign Ministry spokesman said. We have come to seek the opening of Japans financial and banking markets Jake Garn ranking Republican on the Senate Banking Committee told Prime Minister Yasuhiro Nakasone. Japans financial and banking market is very large and increasingly sophisticated but there is not yet true reciprocity between Japan and the United States in this market the ministry official quoted Garn as saying. Nakasone replied that some problems exist over providing more seats on the Tokyo Stock Exchange for foreign firms one of the main steps urged by the U.S. Delegation. But I promise to make Tokyos markets as open as those of New York he told Garn and three other legislators. In separate talks with Finance Minister Kiichi Miyazawa the U.S. Group also urged Japan to give U.S. Financial institutions a bigger role in the underwriting of long-term Japanese government bonds a Finance Ministry spokesman said. REUTER | U.S. LAWMAKERS URGE JAPAN TO OPEN FINANCIAL MARKET |
North Yemen at its weekend tender bought white sugar from a French operator acting on behalf of a Swiss house at 214.70 dlrs a tonne c and f traders said. The amount bought was not immediately available although the country had sought 30000 tonnes of June arrival whites they said. REUTER | NORTH YEMEN BOUGHT WHITE SUGAR AT TENDER - TRADE |
A Ministry of International Trade and Industry (MITI) official denied a local news agency report that Japan will end its seven-month-old semiconductor agreement with the U.S. If Washington imposes tariffs on 300 mln dlrs worth of Japanese electronic goods from April 17. Kyodo News Agency reported a high-ranking MITI official as saying Japan would end the chip pact if the U.S. Implements the punitive tariffs. Nothing new has been decided the official said. As MITI said on Saturday Japan would only pursue its rights under the General Agreement on Tariffs and Trade (GATT) he added. REUTER | JAPAN DENIES REPORT IT MAY END CHIP PACT WITH U.S. |
Japan warned the United States it may take retaliatory measures if the U.S. imposes its planned trade sanctions on April 17 a senior government official said at the weekend. Shinji Fukukawa Vice Minister of the International Trade and Industry Ministry said in a statement that Japan would consider measures under the General Agreement on Tariffs and Trade and other actions if the United States imposes 100 pct tariffs on some Japanese exports as planned next week. However Fukukawa said Japan was ready to continue trade talks with the United States despite its failure to convince America to call off the threatened tariffs during two days of emergency talks which ended in Washington on Friday. In March President Reagan announced the sanctions in retaliation for what he called Japans failure to honor a July 1986 pact to stop dumping computer microchips in markets outside the U.S. and to open its home market to U.S. goods. Fukukawa said the U.S. had not listened to Japans explanation of its efforts to live up the pact. He saod the U.S had not given detailed reasons of why it planned tariffs. Reuter | JAPAN WARNS U.S. IT MAY RETALIATE IN TRADE ROW |
The Bank of England said it had provided the money market with 75 mln stg help in the morning session. This compares with the Banks estimate that the system would face a shortage of around 400 mln stg today. The central bank bought bank bills outright comprising two mln stg in band two at 9-13/16 pct 15 mln stg in band three at 9-3/4 pct and 58 mln stg in band three at 9-11/16 pct. REUTER | U.K. MONEY MARKET GIVEN 75 MLN STG ASSISTANCE |
The Bank of Japan actively bought dollars here in early afternoon trade at around 142.20 yen dealers said. The central bank had placed buy orders at that level and prevented the dollar from falling when it came under heavy selling pressure from investment trusts and trading houses they said. However the intervention failed to boost the U.S. Currency significantly from the 142.20 yen level they added. The dollar was trading around its midday rate of 142.30 yen. It had opened here at 141.85 yen. REUTER | JAPAN CENTRAL BANK ACTIVELY BUYS DOLLARS IN TOKYO |
Japanese trade figures are seriously challenging the entrenched view of policy makers of the Group of Seven industrialised nations that relative currency rates are the key to smoothing world trade problems. Senior Japanese U.S. And European officials in Tokyo say they are at a loss to fully explain the data for if currencies are the key they ask why then are are U.S. Exports to Japan shrinking? What if manipulating currencies and driving the dollar down made world trade problems worse rather than solving them fulfilling Federal Reserve chairman Paul Volckers forecast of world trade recession? U.S.-Japan trade has declined even after a 40 pct dollar fall against the yen since the September 1985 Group of Five pact in New York. The lower dollar ought to have made U.S. Exports 40 pct more competitive in Japan. The officials most of them economists can offer no objective reason why they are not. Worse how are European Community sales to Japan rising rapidly when the European Currency Unit has until now declined only 11 pct against the yen.? Last weeks G-7 meeting in Washington has been widely interpreted as a sign from the policy makers that the dollar must go lower. So worst of all what if Volcker is correct? At a loss to give an objective explanation officials can only offer explanations which tend to be highly subjective. I dont know and I dont think anyone knows said Hugh Richardson acting head of the EC delegation in Tokyo. What I do know is that Community exporters are making a hell of an effort in this market. If you make an effort there is money to be made in Japan he added. But U.S. Officials and businessmen are convinced low U.S. Exports to Japan are Japans fault. They cite restrictive trade practices protected Japanese trade sectors such as agriculture and non-tariff barriers such as unreasonable checking and customs procedures for car imports. Publicly Japanese officials remain conciliatory in the face of what they see as U.S. Aggression. In private they blame U.S. Industry for being uncompetitive. We see it that way but we dont like to seem arrogant said a senior official who declined to be named. We like to refrain from accusing them of not making enough effort. Industrialists such as Eishiro Saito chairman of the Keidanren business group and Sony Corp chairman Akio Morita repeatedly accuse foreign firms of not making enough effort to understand Japans markets and some foreigners agree. The real issue is the inability of major sectors of American and European industry to compete not only internationally but even in their home markets Peter Huggler President of Interallianz Bank Zurich told a recent conference in Switzerland. REUTER...^M | CURRENCY MOVES MAY BE HURTING WORLD TRADE |
Turkey is to apply tomorrow for European Community membership Foreign Ministry officials said. They told Reuters that Minister of State Ali Bozer would lodge the application in Brussels with Belgian Foreign Minister Leo Tindemans. Turkey would be the 13th member of the group of which Belgium is current president. REUTER | TURKEY TO APPLY FOR EC MEMBERSHIP |
Negotiations scheduled between the metalworkers IG Metall union and employers to resolve an impasse over a new contract will start on Wednesday the union said in a statement. IG Metall is demanding a 35-hour week with a parallel increase in wages of five pct. Employers Gesamtmetall have offered a half-hour shortening in the current working week to 38 hours and an initial rise of 2.8 pct. IG Metall under newly-elected leader Franz Steinkuehler proposed the talks on Thursday after regional negotiations in the northern part of the state of Baden-Wuerttemberg collapsed. REUTER | GERMAN METALWORKERS' WAGE TALKS BEGIN WEDNESDAY |
Saudi Arabia is in the market for 4000 tonnes of refined bleached deodorised palm olein for June 1/10 shipment traders said. REUTER | SAUDI ARABIA SEEKING RBD PALM OLEIN |
The London based trade journal METAL BULLETINS average producer price of good ordinary brand zinc for week ended April 10 is 790.00 dlrs per tonne. Reuter | METAL BULLETIN ZINC PRODUCER PRICE |
U.K. Producer price data for March were roughly as expected after taking into account technical factors which affected the year-on-year outcome economic analysts said. The figures showed a 0.3 pct provisional non-seasonally adjusted rise in output prices in March unchanged from February and close to the average for the last six months. The year-on-year rise was put at 3.7 pct down from 4.2 pct in February. But Chris Tinker economist at brokerage house Phillips and Drew said the drop in the year-on-year rate mainly reflected a rise in excise duties which affected the index in March last year. He cautioned that it was dangerous to read too much into the monthly figure adding that a rise of only 0.2 pct in April would take the year-on-year rise back above 4.2 pct. Analysts also noted that a drop in manufacturers input prices was almost entirely due to anticipated seasonal factors such as a fall in industrial electricity costs. Duncan Squire of Lloyds Merchant Bank said the figures were slightly disappointing in that the strengthening of sterling had not yet reduced input prices as much as expected. Both he and Tinker said this factor should help keep input costs down over the next few months although Tinker added that last years fall in oil prices is now about to drop out of the year-on-year comparisons and is likely to lead to a return to rises in the index rather than falls. REUTER | U.K. PRODUCER PRICES SEEN MOVED BY TECHNICALITIES |
West German Economics Minister Martin Bangemann indirectly rejected a call from the countrys leading economic research institutes for early introduction of a major tax reform involving gross tax cuts of 44 billion marks. In a statement reacting to the five institutes joint spring report Bangemann said that as far as the call for bringing forward the 1990 tax reform was concerned -- The government points out that the positive effects for growth of its policy of consolidation (cutting the budget deficit) must not be allowed to be endangered. Bangemann also recalled that the scope of tax cuts planned for 1988 had already been increased. Three institutes predicted two pct economic growth in 1987 with exports falling by 0.5 pct. The other two saw only one pct growth and said exports would fall 2.5 pct. Bangemann said The government agreeing with the majority sees no reason for the extraordinarily pessimistic estimate for exports expressed by the minority. He said there was reason to believe that export demand would start to rise in the course of the year partly because of a further increase in world trade. REUTER | BANGEMANN REJECTS CALL FOR EARLY TAX CUTS |
Italys Gross Domestic Product calculated at 1980 prices rose 2.4 pct in the fourth quarter of 1986 compared with the same period in 1985 National Statistics Institute ISTAT said. ISTAT said in a statement that GDP growth in fourth quarter 1986 was zero compared with the preceding quarter. Italys budget ministry said last month that 1986 GDP rose 2.7 pct in real terms from 1985. Imports in the fourth quarter totalled 26361 billion lire down 1.4 pct from the 1985 fourth quarter and down 6.6 pct from the third 1986 quarter ISTAT said. Istat said exports totaled 23190 billion lire in the fourth quarter down 4.1 pct from the comparable 1985 quarter and down 6.7 pct from the third quarter in 1986. Fixed investments were 23438 billion lire in the fourth quarter down 0.7 pct from the preceding quarter and up 1.1 pct from the comparable 1985 quarter. REUTER | ITALIAN GDP ROSE 2.4 PCT IN 1986 FOURTH QUARTER |
Tokyo share prices are expected to weaken further for about a week following a sharp drop which at one time today saw the Nikkei Dow index down 571.01 points in mid-afternoon trading brokers said. They said uncertainty caused by disputes between Japan and its main trading partners will continue to deter investors from equities. The market index which closed the day 297.05 points down at 22919.54 will probably end the present downturn at around 22300 points brokers predicted. This is just a short-term correction and the market will probably end up at about 22300 in about a weeks time said a broker at Nomura Securities Co. He said that todays late recovery from afternoon lows showed that investors were still hunting bargains in anticipation of an upturn. Brokers reiterated expectations of an imminent cut in Japans 2.5 pct discount rate a factor seen to be diverting money from bank accounts into stocks and boosting the market. Securities company bank and insurance issues likely to benefit from a rate cut were bought in late trading. The Nomura broker said he expects the rate cut in May or June after Prime Minister Yasuhiro Nakasones scheduled visit to Washington on April 29. Nakasone is expected to seek an end to Japanese-U.S. Trade disputes which are hurting investor confidence. Until we see some concerted effort by the Japanese to halt the yens rise against the dollar and settle trade disputes the market will stay low said head of equities at Jardine Fleming Securities Co Mario Malt. Malt said current talks between the countries were inflammatory and damaged stockmarket optimism. Brokers also said that Japans ruling Liberal Democratic Party has to show it still rules after Sundays nationwide local elections showed dwindling support. It raises doubts on whether the LDP can push through the reforms it planned for this year said one broker. Top policy priorities this year are deregulation of financial activities stimulation of domestic demand to boost imports and removal of agricultural subsidies. If these policies are abandoned or scaled down stockmarket investors will have few reasons to buy stocks brokers said. REUTER | FURTHER WEAKNESS SEEN IN TOKYO STOCKS IN NEAR TERM |
Two Utah financial institutions the Bank of Iron County and Summit Savings and Loan Association have failed official spokesmen said. The board of directors of the Federal Deposit Insurance Corporation (FDIC) has approved the assumption of the deposit liabilities of Bank of Iron County Parowan Utah by Dixie State Bank St George Utah an FDIC spokesman said. The bank which had total assets of 20.1 mln dlrs was the first bank in Utah to fail this year and the 59th nationwide. Its three offices will reopen today as branches of Dixie State Bank and its depositors will automatically become depositors of the assuming bank. Dixie State Bank will assume about 19.9 mln dlrs in 6300 deposit accounts and will purchase all of the failed banks assets at a discount of 3.575 mln dlrs. The Federal Home Loan Bank Board closed Summit Savings and Loan Association Park City Utah and directed the Federal Savings and Loan Insurance Corporation (FSLIC) to transfer an estimated 116.9 mln dlrs in insured deposits to United Savings and Loan Association Ogden Utah an FSLIC spokesman said. Summit a 120.8 mln dlr institution was insolvent the spokesman said. The bank board appointed the FSLIC as conservator for the association on April 14 1986. Summit has since operated as part of the bank boards Management Consignment Program. United Savings has 205 mln dlrs in assets and nine offices in Utah and one in Idaho. REUTER | TWO UTAH FINANCIAL INSTITUTIONS FAIL |
Top officials of leading industrial nations appear deeply worried that financial markets have ignored their efforts to coordinate policies which they believe they strengthened in talks last week. Monetary sources said officials were exasperated that the markets which drove the dollar rapidly lower and severely disrupted bond and stock markets too did not take heed of the policy commitments of the Group of Seven -- the United States Japan West Germany France Britain Italy and Canada. Treasury Secretary James Baker went out of his way to reassure markets of his commitment to a stable dollar with a statement and French Finance Minister Edouard Balladur underscored that by saying: I dont believe at all that the Americans want a weaker dollar. West German Finance Minister Gerhard Stoltenberg said the dollars latest rapid descent involves the risk -- now already a tangible threat -- of a new strong surge of inflation leading to a renewed rise in interest rates. But there were signs too that while policymakers feared the market uproar they seemed to accept there was little they could do until the economic picture changed and currencies settled into a stable pattern as a result. Nor did there seem to be any enthusiasm at last weeks semi-annual meetings of the IMF and the World Bank for higher U.S. Interest rates as the best way to curb the dollars rapid descent. That distaste stems in part from fears of recession. Outgoing Deputy Treasury Secretary Richard Darman told television interviewers he did not think a policy of driving the dollar down would solve the U.S. trade deficit. It would slow growth in Germany and Japan which would adversely affect our trade balance and ultimately it would drive interest rates up here which would throw us if not (into) recession into slower growth he said. Asked if higher U.S. Interest rates would stabilize the dollar Balladur said: When a currency is maintained artificially high by artificially high interest rates it is not healthy. And resorting to higher interest rates could lead to recession he said. Acknowledging the dollars latest slide was now a fact of life Balladur said there may be adjustments of course in one or other currencies this is not a fixed rate system. But Federal Reserve Board chairman Paul Volcker said he might rein in credit if the dollars slide deepens. U.S. Monetary sources also said Washington wanted it understood by markets the sevens commitments were genuine. The United States and the six major industrial countries are fully committed to implementing our undertakings in these agreements Baker told the meetings. Darman said Baker had been misinterpreted by markets which wrongly believed earlier remarks suggested he wanted a further decline in the dollar. Baker Darman said was committed to stabilizing currencies at current levels. Last weeks statement from the seven reaffirmed a February 22 agreement in Paris in which the Reagan administration agreed to reach a budget deficit compromise with Congress and to fight protectionism. West Germany and Japan meanwhile agreed to stimulate domestic demand and lead a global upturn. Ministers believed the Paris pact was bolstered by Japans promise of a 35 billion dlr supplementary budget. The sources said they believed Baker saw it as a major action. But the seven seem to accept their commitment to stable currencies applied to todays exchange rates and not those at the time of the Paris agreement when the dollar stood higher. The Paris accord said currencies (are) within ranges broadly consistent with underlying economic fundamentals given the policy commitments summarized in this statement. Now they accept the dollars lower level especially against the yen as hard reality that is nonetheless consistent with the agreement. The ministers and governors reaffirmed the view that around current levels their currencies are within ranges broadly consistent with fundamentals last weeks statement read. Monetary sources said policymakers understood markets were focusing on instability created by the gap between the U.S. Trade deficit and the surpluses of West Germany and Japan rather than prospective policy changes. European monetary sources said Bonn was still unconvinced that Washington meant business with its commitment to cut the budget deficit. Reuter | G-7 SEEMS WORRIED MARKETS IGNORE COORDINATION |
The five leading West German economic research institutes which have revised down their forecasts for 1987 growth do not predict a recession in West Germany their spokesman Hans-Juergen Schmahl said. The institutes were divided in their spring report on forecasts for 1987 with three predicting two pct growth and two seeing only one pct expansion. Growth was 2.4 pct in 1986. Schmahl presenting the report at a news conference said None of the institutes reckons with a recession or with the beginning of a recession. He added however that exports remained the weak point of the economy . Schmahl also said West Germany would have to expect further encroachments of foreign goods onto its markets. Arthur Krumper of Munichs Ifo institute which with the DIW of West Berlin had presented the more pessimistic view of the economy said The braking effects (on the economy) produced by external factors will remain considerable for most of the year. REUTER | INSTITUTES SEE NO WEST GERMAN RECESSION |
Shr 1.11 dlrs vs 1.10 dlrs Shr diluted 1.03 dlrs vs 1.02 dlrs Net 8186000 vs 8114000 Reuter | DEPOSIT GUARANTY CORP <DEPS> 1ST QTR NET |
Computer Associates International Inc said it has started its previously-announced 1.92 dlr per share tender offer for all shares of BPI Systems Inc. In a newspaper advertisement the company said the offer which has been approved by the BPI board and is to be followed by a merger at the same price is conditioned on receipt of at least 1813742 shares. The offer and withdrawal rights expire May 15 unless extended. In addition to shares sought in the tender shareholders of BPI owning 1951720 shares or 34.6 pct have agreed to sell their shares to Computer Associates for the tender price. Reuter | COMPUTER ASSOCIATES <CA> STARTS BPI <BPII> BID |
Former Guinness Plc <GUIN.L> chairman Ernest Saunders dismissed allegations he ordered the shredding of documents in the early stages of a U.K. Investigation as completely untrue the Press Association news agency reported. The allegations were made by his former personal assistant Margaret McGrath in a statement to the High Court on Friday. Saunders reply was read out by his lawyer at the start of the fourth day of a hearing on an application by Saunders and U.S. Lawyer Thomas Ward for the discharge of asset-freezing orders obtained by Guinness on March 18. McGrath alleged that among the documents destroyed were papers from the files on the <Distillers Co Plc> bid as well as diaries correspondence and an address book. The temporary orders froze property owned by the two men valued about 5.2 mln stg the sum paid by Guinness into a Jersey bank last May during the Distillers takeover. They are also contesting orders requiring them to disclose the whereabouts of the money and hand it back to Guinness lawyers. REUTER | SAUNDERS DENIES "PAPER SHREDDING" ALLEGATIONS |
The Federal Home Loan Bank Board said it had closed Future Savings and Loan Association of Albany Ore. and transferred its insured deposits to Williamsburg Savings Bank of Salt Lake City Utah. Future had 6614 accounts with total deposits of 57.3 mln dlrs. On Monday its five branches in Oregon will open as branches of Williamsburg which has 287 mln dlrs in assets and 19 offices in Oregon Washington state and Utah. The Bank Board said it closed Future because the association was insolvent. The Board said Future lost money on commercial real estate loans which were poorly underwritten and inadequately appraised. Future also violated regulations on the amount of money which could be loaned to one individual the Board said. Accounts of up to 100000 dlrs at Future are insured by the Federal Savings and Loan Insurance Corp (FSLIC). Depositors with accounts of over 100000 dlrs will share Futures assets on a pro rata basis after the assets have been liquidated. Future was the ninth federal savings association to be closed this year compared with 21 in 1986. Reuter | BANK BOARD CLOSES OREGON SAVINGS ASSOCIATION |
Shr 21 cts vs eight cts Net 6597000 vs 2602000 Revs 56.4 mln vs 23.2 mln 1st half Shr 57 cts vs 32 cts Net 17.6 mln vs 9810000 Revs 137.7 mln vs 76.0 mln Reuter | KING WORLD PRODUCTIONS INC <KWP> 2ND QTR FEB 28 |
Year to end-December Shr 76.7p vs 67.7p Div 17p making 23p vs 21p Pretax profit 127.0 mln stg vs 116.9 mln Turnover 1.10 billion vs 947.2 mln Tax 25.0 mln vs 26.3 mln Note - company full name is Blue Circle Industries Plc <BCIL.L>. Company said it proposes one-for-one capitalisation issue Gross profit 390.9 mln vs 321.6 mln Distribution costs 215.6 mln vs 177.6 mln Administrative expenses 65.1 mln vs 58.9 mln Other operating income 5.3 mln vs 11.0 mln Share of profits of related companies 50.0 mln vs 58.1 mln Operating profit 165.5 mln vs 154.2 mln Net interest payable 33.6 mln vs 32.2 mln Exceptional items 4.9 mln debit vs 5.1 mln debit Minorities 3.4 mln vs 6.9 mln Extraordinary items after tax 39.5 mln vs 4.2 mln Pretax profit includes - U.K. 37.7 mln vs 20.5 mln U.S. 27.5 mln vs 22.8 mln Mexico 15.0 mln vs 20.7 mln Australasia 15.7 mln vs 13.2 mln Africa 12.0 mln vs 12.6 mln REUTER | BLUE CIRCLE PROFITS, DIVIDEND RISE |
Railway cargo handlers yesterday called a three-day strike starting April 19 to press for higher wages union sources said. Workers of the Contratas Ferroviarias franchise firm which is also responsible for train and railway station maintenance are asking for an eight pct wage rise. The company has offered four pct. Reuter | SPANISH RAILWAY WORKERS CALL STRIKE |
Northrop Corp said it and Eaton Corp have been selected by the McDonnell Douglas Corp/Textron Inc team to codevelop the aircraft survivability equipment for the U.S. Armys light helicopter experimental program. The Army is expected to pick contractors to produce the helicopters in 1992. Reuter | NORTHROP <NOC>/EATON <ETN> IN HELICOPTER PROGRAM |
Crazy Eddie Inc said it is negotiating for the possible acquisition of Benel Distributors Ltd which operates Crazy Eddie Record and Tape Asylums in all Crazy Eddie stores. It said the acquisition would probably also include affiliate Disc-o-Mat Inc which operates a number of record and tape stores in the New York metropolitan area. Other details were not disclosed. Reuter | CRAZY EDDIE <CRZY> MAY MAKE ACQUISITION |
Crazy Eddie Inc said its board has adopted a defensive shareholder rights plan and said it has received friendly inquiries on its acquisition. It said under the plan shareholdrs of record as of April 21 will receive a right to purchase under certain circumstances at a price of 42 dlrs 0.01 preferred share for each common share held. The rights will expire April Nine. The company said the rights would be exercisable 20 business days after a party were to acquire 20 pct or more of Crazy Eddie common stock or announce a tender or exchange offer that would result in ownership of 30 pct or more. Crazy Eddie said if a party owning 20 pct or more of its stock were to merge into it or if a party were to acquire 40 pct or more of Crazy Eddie stock right holders other than the acquiring party would be entitled to acquire common shares or other securities or assets with a market value equal to twice the rights exercise price. If after a party acquired 20 pct or more of its stock Crazy Eddie were acquired or 50 pct of its earnings power or assets sold rightholders other than the acquirer would be entitled to buy shares of the acquirers common stock worth twice the rights exercise price the company said. Crazy Eddie said if a party were to acquire 30 pct or more of its common stock and then fail to acquire Crazy Eddie within 180 days thereafter rightholders would be entitled to exchange their Crazy Eddie common stock for subordinated notes of Crazy Eddie maturing either one year or above a certain dollar limt five years after issuance. Crazy Eddie said adoption of the plan is not in response to any known effort to acquire control of it. But the company said it has become aware of some possible accumulations of its stock has has received some friendly inquiries. Reuter | CRAZY EDDIE <CRZY> SETS DEFENSIVE RIGHTS |
Six workers were killed and four injured in an undeground rock fall at South Africas second largest gold mine today the mine owners said. It was the third major mine accident in the country in less than a week. Thirty four workers died in methane gas explosion at a coal mine last Thursday. Reuter | SIX KILLED IN SOUTH AFRICAN MINE |
The Zambian kwacha fell at this weeks foreign exchange auction to 18.75 kwacha to the dollar from last weeks 16.95 the Bank of Zambia said. The rate was the lowest since the auctions resumed two weeks ago under a new two-tier exchange rate system worked out with the World Bank and International Monetary Fund. The Bank of Zambia said it received 370 bids ranging from 13.00 to 20.75 kwacha for the six mln dlrs on offer. One hundred and thirty-five bids were successful. A British High Commission spokesman said Britain would put eight mln stg into the auction at a rate of one mln a week as soon as Zambia reached a full agreement with the IMF. The money could be spent only on goods produced and supplied by British firms excluding luxuries and defence equipment the spokesman added. Reuter | ZAMBIA'S KWACHA FALLS AT WEEKLY AUCTION |
Senate Finance Committee Chairman Lloyd Bentsen (D-Tex.) called on major industrial countries to make a pledge at the coming economic summit in Venice to cut interest rates. I think at the summit meeting in Venice what we ought to be trying to do is to get the other major industrial nations that are involved to bring interest rates down say one pct Bentsen told NBC Televisions Meet the Press. Bentsen said coordinated rate cuts could take billions off the debt service of the Latin countries and help ease protectionist pressures in the industrial countries. Bentsen also South Korea and Taiwan should be pressured to revalue their currencies in relation to the U.S. dollar. You take the Taiwanese with an enormous capital surplus enormous trade surplus and weve had very little cooperation there he said. Departing Deputy Treasury Secretary Richard Darman told the same television network he agreed that the U.S. dollar had not fallen enough against the currencies of some countries. I think that more does have to be done there in negotiations with the countries involved the so-called NICs (newly industrialized countries) he said. Darman said such negotiations with newly industrialized countries were underway privately. Bentsen predicted Congress and the White House would agree on a fiscal 1988 budget that would raise between 18 and 22 billion dlrs in new revenues. The Texas senator said a series of excise taxes would be considered by Congress including an extension of the telephone tax and new levies on liquor and cigarettes. Bentsen said he supported an oil import fee but that it would not happen without President Reagans support. Darman called for a top level negotiation between the White House and Congress on a budget compromise that would include asset sales some excise taxes cuts in middle-class entitlement programs a reasonable steady rate of growth in defense and reform of the budget process. Reuter | U.S. SENATE LEADER CALLS FOR INTEREST RATE CUTS |
A 3.22 billion dlr offer for Dome Petroleum Ltd <DMP.MO> by TransCanada Pipelines Ltd <TRP.TO> may short-circuit Domes restructuring plan and open the door for more takeover bids oil analysts said. Dome is trying to get approval for a plan to refinance debt of more than 4.5 billion dlrs by July 1 1987 when an interim debt plan that allowed the Canadian oil and gas firm to defer substantial payments to creditors will expire. Analysts said TransCanadas bid signals Domes debtholders that an alternative exists to Domes debt plan. Dome announced its plan to 56 major creditors as well as public noteholders in March after several months of delicate negotiations. TransCanadas proposal amounts to a quasi debt restructuring oil analyst Doug Gowland of Brown Baldwin Nisker Ltd said from Toronto. Calgary-based Domes restructuring plan would allow creditors to convert debt to common shares under a formula yet to be negotiated. Payments on remaining debt would be linked to cash flow generated by assets pledged against the debt. The weakness of the whole debt-refinancing proposal is that even with approval of creditors there is no assurance that Dome will in fact be able to repay all of its debt obligations said Wilf Gobert an oil analyst for Peters and Co Ltd in Calgary. TransCanadas announcement came as a surprise since Dome was waiting for responses from creditors on its proposed refinancing packages Gobert said. The TransCanada proposal could open the bidding for Dome since other potential buyers were probably waiting for lenders to agree to a restructuring he added. I would think that the debtholders would want to entertain any and all offers (for Dome) Gobert said. Dome spokesman David Annesley said in New York that TransCanadas announcement could be seen as an attempt to fix the bidding price for Dome and an effort to preclude other possible buyers from making an offer. By drawing attention to us in our discussions it means that others may be a little reluctant to come forward he said. Dome does not consider TransCanadas proposal a formal offer because the pipeline utilitys announcement breached a confidential agreement between the two companies he said. Dome responded to the statement by suspending discussions with TransCanada in order to pursue talks with other unidentified parties. However Dome said its management and financial advisers would evaluate all proposals including TransCanadas. Gowland said TransCanadas offer is probably a fair price for the companys 36.1 mln acres of oil and gas land holdings. However he said not enough financial details are known about Domes debt restructuring to compare the value of TransCanadas proposed offer. Reuter | OFFER FOR DOME MAY SHORT-CIRCUIT ITS DEBT TALKS |
Investor Martin T. Sosnoff said he has raised his offer for Caesars World Inc shares to 32 dlrs each from 28 dlrs and has reduced the number of shares he is seeking to 29.1 mln from all those not already owned. In a newspaper advertisement Sosnoff said the bid by his MTS Acquisition Corp withdrawal rights and the proration period will now expire June 19 unless extended. The offer had been scheduled to expire May 15. In late March Sosnoff said he had received a negligible number of shares in response to the offer which had been rejected by Caesars as inadequate. Sosnoff already owns about four mln of Caesars 30 mln common shares now outstanding or a 13.3 pct interest on a primary basis. Last week Caesars board approved a recapitalization plan as an alternative to the Sosnoff offer under which shareholders would receive a special dividend of 25 dlrs per share subject to approval by shareholders at a special meeting to be held in June. The company planned to borrow 200 mln dlrs and sell 800 mln dlrs in debt to finance the payout. Sosnoff said in the newspaper advertisement that the amended offer is conditioned on receipt of enough shares to give him a majority interest on a fully diluted basis and on the arrangement of financing as well as to approvals by New Jersey and Nevada gaming authorities. He said the tender would be the first step in acquiring all of Caesars shares and if successful would be followed by a merger transaction. Sosnoff said later in a statement that the 29.1 mln shares he is now seeking together with the 4217675 shares he owns would give him a 92.4 pct interest on a fully diluted basis. He said he still has received only a negligible number of shares in response to his tender. In a letter to Caesars chairman Henry Gluck included in the statement Sosnoff said Gluck had again refused on April 8 to meet with him even though he had said he was willing to increase the price of his offer. Sosnoff said the financing for the offer is almost fully in place. Sosnoff said PaineWebber Group Inc <PWJ> has now delivered to him commitments to purchase up to 475 mln dlrs of increasing dividend cumulative exchangeable preferred stock of MTS Holding Corp an indirect parent corporation of MTS Acquisition. He said Marine Midland Banks Inc <MM> which leads a syndicate that has provided commitments for a 500 mln dlr margin facility believes it will be able to arrange for further commitments under the margin facility to advance up to an additional 25 mln dlrs that may be needed to permit the purchase of shares under the offer. Sosnoff said under the merger that would follow his tender each of the 2750000 Caesars shares not covered by the offer or 7.6 pct on a fully diluted basis would be converted into Series A preferred stock valued at 32 dlrs per shareby an independent investment baking firm. He said To the extent that fewer than 29100000 sdhares are purchased in the offer the stockholders would receive a combination of cash and Series A preferred stock having a value of 32 dlrs per share of Caesars. Sosnoff said he believes terms of his offer are superior to Caesars recapitalization. Sosnoff said he will be meeting this week with gaming officials in Nevada in an effort to expedite the investigatory process required for regulatory approval a process that it already underway in New Jersey. He said his offer has been extended based on the likely duration of the regulatory process. He said he intends to further extend the offer if the approval process is not completed by the expiration date. Reuter | SOSNOFF RAISES BID FOR CAESARS WORLD <CAW> |
Crazy Eddie Inc executive vice president and chief financial officer Sam Antar who turns 66 soon has resigned from its board and has been replaced by William H. Saltzman vice president and general counsel of Sun/DIC Acquisition Corp. Sam Antar and other executive vice presidents Mitchell Antar and Isaac Kairey were named to an Office of the President that took over the duties of chief executive officer from chairman Eddie Antar in January. Reuter | CRAZY EDDIE <CRZY> EXECUTIVE LEAVES BOARD |
U.S. Secretary of State George Shultz and Soviet Foreign Minister Eduard Shevardnadze met today an in elegant Moscow mansion in pursuit of the first superpower arms control agreement in nearly a decade. Shultz accompanied by senior advisers and technical experts arrived from Helsinki aboard a U.S. Air Force plane and went straight into a closed-door meeting with Shevardnadze and Soviet negotiators. State Department spokesman Charles Redman told reporters that U.S. Arms control advisers had been told not to discuss the U.S. Proposals with the press. U.S. Officials have been optimistic about the possibility of progress at the talks scheduled to end on Wednesday. Shultz has been more guarded saying that if the Soviet officials approached the talks in the same constructive spirit as the Americans we should be able to move the ball along in a very positive way. Shultz is expected to protest about a spying network that has come to light at the U.S. Embassy and which has cast a shadow over his talks. For its part the Soviet Union has said its diplomatic missions in the United States are subjected to surveillance and has accused Washington of spy-mania. Shevardnadze met Shultz with a handshake at the door of the ornate guest house built by a Russian merchant now belonging to the Foreign Ministry. Later in the white marble room where the discussions were being held they had to be prompted by photographers to shake hands again. There was no instinctive warmth an observer said. Reuter | SHULTZ BEGINS TALKS WITH SHEVARDNADZE |
Shr loss 67 cts vs loss two cts Net loss 3721000 vs loss 107000 Revs 155.7 mln vs 24.2 mln NOTE: Results for 12 months ended Dec 31 1986 and eight months ended Dec 31 1985. Because of the acquisition of Brooks Drug in September 1986 and the companys change of fiscal year prior-year results are not comparable Compact Video explained. Reuter | COMPACT VIDEO INC <CVSI.O> YEAR LOSS |
Leaders of the nations unionized automobile workers have signaled their intent for a major work stoppage later this year if General Motors Corp. <GM> and Ford Motor Co. <F> fail to satisfy demands for job security pay raises and protection against shifting U.S. production to foreign sources. United Automobile Workers (UAW) president Owen Bieber was loudly cheered by some 3000 local delegates at a special bargaining strategy convention yesterday when he declared the 1.1 mln-member union is ready to go to war against the major auto makers in support of its goals. It takes two to make peace but only one to make war ... and if its war the UAW will be ready for it. War against the insecurity of layoff the UAW chief said. The militant tone as the four-day convention opened underscored the probability for bitter confrontation during the summers labor negotiations between the UAW and the auto companies over new contracts covering some 500000 U.S. workers at G.M. and Ford. The current pacts expire September 14. GM Vice President and chief labor negotiator Alfred Warren recently told Reuters that the 1987 bargaining round would likely be the most difficult of the decade because of the carmakers drive to cut costs and shed uncompetitive parts-making operations employing thousands of workers. Job security has been the unions main theme for several years. A master resolution stating UAW goals notes that the unions membership working in the auto industry has fallen by 200000 since 1978 to a current level of about 690000. GM was hit by a six-day selective national strike in 1984 before signing its current labor agreement which contains a one billion dlr job security fund to protect workers whose jobs are threatened by new technology or moves to outside suppliers. At Ford which has more than 8 billion dlrs in cash reserves and out-earned larger GM last year for the first time since 1924 executives said they would oppose the UAWs demand for a return to guaranteed percentage annual pay increases that were dropped in the last recession. Ford has not been hit by a national strike since 1976 which has prompted some union analysts to suggest it is now Fords turn to be the UAW strike target. Bieber yesterday described the UAWs situation in 1987 as crucial in view of the growing penetration of the U.S. market by imported cars and trucks as well as moves by the Detroit automakers to use foreign and other non-union sources to secure cheaper vehicles and auto parts. He said the union will stress job security annual general pay raises improved profit-sharing and limits on companies ability to transfer work. Reuter | UAW SAYS MAJOR WORK STOPPAGE POSSIBLE AT GM, FORD |
Oper shr 45 cts vs 26 cts Oper net 2258000 vs 1166000 NOTE: 1986 net excludes 842000 dlr tax credit. Reuter | NEWORLD BANK FOR SAVINGS <NWOR> 1ST QTR NET |
The Newspaper Advertising Bureau said its preliminary estimates show spending for newspaper advertising in January totaled 2.06 billion dlrs an increase of 10.5 pct from the year earlier month. The bureau said retail advertising for the month was up 10.7 pct to 1.02 billion dlrs. National advertising was off 0.7 pct to 264 mln dlrs. Classified increased 14.7 pct to 777 mln dlrs. Reuter | JANUARY NEWPAPER ADVERTISING INCOME UP 10.5 PCT |
USAIR TO BUY 55 PCT OF 17.0 MLN PIEDMONT SHARES TENDERED |
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Deutsche Texaco AG Texaco Incs <TX.N> 99.15 pct-owned West German subsidiary will not be affected by the legal dispute with the Pennzoil Company <PZL.N> managing board chairman Armin Schram said. Schram told a news conference that Deutsche Texacos business will not be affected by the legal proceedings in the U.S. Our liquidity is more than sufficient to guarantee supplies of crude oil and products to refineries and customers. Schram said West German law prohibited the parent company from touching our basic capital of 500 mln marks and reserves of 81 mln. REUTER | DEUTSCHE TEXACO NOT AFFECTED BY LEGAL DISPUTE |
Pakistans Corporate Law Authority CLA has begun an enquiry into imports of tea from Kenya and the trade imbalance between the two countries CLA chairman Irtiza Husain confirmed. He told Reuters by telephone that importers Liptons and Brooke Bond had been asked to supply data to the authority and a hearing would be held. The CLA would then report back to the Commerce Ministry which had requested the enquiry. Husain said no date had yet been set for the hearing and declined to give further details of the matter. Industry sources told Reuters reports that the companies tea import licences had been suspended were incorrect. Reuter | PAKISTAN CONFIRMS KENYA TEA IMPORT INVESTIGATION |
Portugals economy which has been enjoying one of its most buoyant periods in more than a decade may now be strong enough to shrug off the countrys latest government crisis analysts said. But the April 3 ousting of Prime Minister Anibal Cavaco Silvas government could slow economic reforms and investment as Portugal continues to adapt to membership in the European Community which it joined in January last year they said. Cavaco Silvas minority Social Democratic Party PSD was toppled in a parliamentary censure vote by left-wing parties. The centre-right administration had made economic growth reform a priority in its 17 months in office. In 1986 Portugals economy grew four pct its current account surplus swelled to more than one billion dlrs and inflation fell to 10 pct from 20 pct in 1985. Analysts and businessmen said the prospects of instability were worrying but they felt the foundations for continued growth had not been badly shaken. The economy has developed a certain self-confidence that is now less dependent on the political situation said Fritz Haser economics professor at Universidade Livre Lisbon. The market doesnt see this as a real crisis yet economist Jorge Braga de Macedo told Reuters. Businessmen have identified political instability over the last 13 years as one of the biggest obstacles to lasting economic progress. The PSD administration was the 16th formed since the 1974 revolution. Portugals developing stock markets however remain buoyant. Brokers and unit trust managers said the recent surge in economic confidence under the PSD rule was still largely underpinned by continuing optimistic forecasts. Investment grew nearly 10 pct in 1986 and a Bank of Portugal forecast released on the day the PSD government fell predicted the pace of investment and overall economic growth would remain at similar levels this year. But analysts said the crisis interrupted current policies and could slow economic development. Soares who is expected to announce a decision by the end of the month can either call early elections or form a new government from parties in the existing left wing-dominated parliament. Many businessmen said they strongly favoured quick elections as the best solution. There is a good chance that a majority government could result from early elections Confederation of Portuguese Industry (CIP) president Pedro Ferraz da Costa said. He said they were optimistic this could mean the continuation in the near future of liberalisation policies introduced over the last year. The left-wing parties favour a parliamentary solution but the PSD said it wants an early election in which opinion polls say they could win an overall majority. A PSD majority would also open the way for more wide-ranging reforms such as relaxation of labour laws and possible denationalisation of industry the analysts said. Cavaco Silva has accused the left-wing opposition parties of blocking key economic reforms. The left-wingers said Portugals positive economic results were more the product of favourable international conditions such as cheaper oil and raw material imports than of PSD policies. REUTER | PORTUGUESE ECONOMY REMAINS BUOYANT DESPITE CRISIS |
Malaysia will reduce its budget for the 1986-1990 development plan to 49 billion ringgit from its original 74 billion to limit expenditure the Economic Planning Unit (EPU) of the Prime Ministers Department said. EPU director-general Radin Soenarno was quoted by the national news agency Bernama as saying this would be done by suspending many projects which could only take off when the recession-hit economy improved. Radin did not specify what projects would be suspended but said the Fifth Malaysian Plan will be reviewed annually instead of on a mid-term basis. REUTER | MALAYSIA CUTS FIVE YEAR PLAN BUDGET |
MERRILL LYNCH FIRST QTR SHR ONE DLR VS 85 CTS |
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U.S. Secretary of State George Shultz arrived in Moscow for talks with Soviet leaders likely to focus on nuclear arms reductions. Shultz flew in from Helsinki and drove straight from the airport to a meeting with Soviet Foreign Minister Eduard Shevardnadze. The three days of talks are overshadowed by an espionage row between the two powers. Shultz has said he wants to discuss it but Soviet officials have indicated they expect him to concentrate on disarmament issues. Reuter | SHULTZ ARRIVES IN MOSCOW FOR ARMS TALKS |
Shr primary one dlr vs 85 cts Shr diluted 97 cts vs 81 cts Net 108.6 mln vs 86.8 mln Rev 2.70 billion vs 2.17 billion Reuter | MERRILL LYNCH AND CO <MER> 1ST QTR NET |
Cooper Canada Ltd said it planned to consolidate its common and class A non-voting shares into one class of common shares subject to shareholder approval on May 1. Cooper Canada said the proposal would result in only voting shares being available to respond to Charan Industries Ltd <CHN.TO>s previously announced six dlr a share takeover bid. Reuter | COOPER CANADA <CPC.TO> SETS SHARE CONSOLIDATION |
International Corona Resources Ltd said its board of directors believes that terms of Royex Gold Mining Corps previously announced offer are fair and reasonable but it decided it will make no recommendation on the offer to its shareholders. Royex on March 31 offered to buy four mln Corona shares. For each Corona share it offered four dlrs cash one series B share of Royex one series C share of Royex and one share purchase warrant. It also bid for all Corona warrants expiring Aug 31 1987. Reuter | CORONA <ICR.TO> FAVORS ROYEX <RGM.TO> OFFER |
South Atlantic Financial Corp said it has agreed in principle to merge with Independence Holding Co into a new company to be called SAFCO International Ltd. It said each South Atlantic share would be exchanged for one SAFCO share and each Independence share for 2.822 SAFCO shares. Independence now owns about 40 pct of South Atlantics 9.8 mln primary common shares. South Atlantic said said its chairman and chief executive officer Sheldon S. Gordon would have the same posts with SAFCO and Independence president Ronald G. Strackbein would be president of SAFCO. The company said the transaction is subject to execution of definitive agreements the receipt of fairness opinions from investment banks and approval by boards and shareholders of both companies. It said proxy materials are expected to be maioled this quarter. Both South Atlantic and Independence are insurance companies. Reuter | S.ATLANTIC <SOAF.O>, INDEPENDENCE <INHO.O> MERGE |
Shr 47 cts vs not given Net 2100000 vs 1277000 NOTE: Company went public in fourth quarter of 1986. Home Federal Savings and Loan Association of Upper East Tennessee. Reuter | HOME FEDERAL UPPER EAST TENNESSEE <HFET> 1ST QTR |
StateWest Airlines Inc said it started service to Las Vegas Nev. Tucson Ariz. and San Diego and entered into a joint fare agreement with Trans World Airlines <TWA>. StateWest said the fare agreement will result in lower fares for StateWest passengers who continue to any one of Trans Worlds 50 U.S. destinations. The company also said the new destinations expand its daily flights to 49 and it added the companys fourth advanced Shorts 360 to its fleet of aircraft. Reuter | STATEWEST EXPANDS SERVICE, ENTERS FARE AGREEMENT |
The U.S. Feeder Steer Price or USFSP as posted by the CME is calculated by Cattle Fax and represents the price used for cash settlement of the CME Feeder Cattle contract. The USFSP is a seven-calendar-day average of feeder steer prices from 27 states based on auction and direct country sales for feeder steers that weigh between 600 and 800 lbs and are estimated to grade between 60 and 80 pct choice when fed to slaughter weight. April 9 Previous quote 70.03 69.87 Reuter | U.S. FEEDER STEER PRICE |
Nova An Alberta Corp said it will redeem its 12 pct cumulative redeemable convertible second preferred shares on May 15 1987 at the redemption price of 26.25 dlrs per share. Holders may convert their shares into class A common shares on the basis of 3.435 class A common shares for each 12 pct convertible preferred share held Nova said. Nova said it retained Burns Fry Ltd Merrill Lynch Canada Inc and Gordon Capital Corp to maintain a market bid of at least 26-3/8 dlrs for the preferred shares until May 12 1987. Nova said that if any 12 pct preferred shares are acquired by the broker group the shares will be converted into class A common shares. Reuter | NOVA <NVA.TO> TO REDEEM PREFERRED |
Columbia Gas Transmission corp said it made an abbreviated streamlined filing with the Federal Energy Regulatory Commission to recover a portion if its costs of renegotiating high-cost gas purchase contracts. Recently the Columbia Gas System Inc pipeline subsidiary said FERC denied on procedural grounds and without prejudice a proposal to include these costs in the companys most recent purchased gas adjustment -- or PGA -- filing. Noting it has has asked for a rehearing on the denial ruling Columbia Gas said it would withdraw its alternative filing if the commission grantes its request for a rehearing to include the contract renegotiation costs in its PGA or consolidates this issue in the pipelines general rate filing and permit recovery subject to refund effective April one. The company said the alternative filing seeks to recover about 79 mln dlrs a year through the pipelines non-gas sales commodity rates. This annual amortization amount is based on recovery of about 653 mln drls over an 8-1/4 year period beginning April 1 1987. Columbia Gas said the filing would increase the pipeline commodity rates by 15.74 cts per mln Btu to 2.95 dlrs per mln. The company said it orginially sought to include these costs in its PGA since the payments to products resulted in almost five billion dlrs in prospective price relief and were not related to take-or-pay buyout costs. It explained this interpretation was based on FERCs April 10 1985 Statement of Policy which said that only take-or-pay buyout costs must be recovered through a general rate filing under the Natural Gas Act. As a result of renegotiating contracts for high-cost gas Columbia Gas said it has been able to reduce the average price paid for gas purchased from Southwest producers to 1.96 dlrs per mln Btu in December 1986 from 3.64 dlrs per mln in April 1985. The pipeline said Southwestern producers account for 46 pct of its total available gas supply this year. Reuter | COLUMBIA GAS <CG> SEEKS CONTRACT COST RECOVERY |
Turkey is to apply tomorrow for European Community membership Foreign Ministry officials said. They told Reuters that Minister of State Ali Bozer would lodge the application in Brussels with Belgian Foreign Minister Leo Tindemans. Turkey would be the 13th member of the group of which Belgium is current president. Reuter | TURKEY TO APPLY FOR EC MEMBERSHIP |
Mellon Bank Corp said J. David Barnes has retired as chairman and chief executive officer and resigned from the board of the company and its Mellon Bank subsidiary. The company said senior director Nathan W. Pearson will succeed Barnes but also appointed a special search committee to review all internal and external candidates for chairman. Mellon said Mr. Barnes felt a change of management at this time would help the bank move more quickly and with less constraint in meeting the needs of shareholders customers and employees. Pearson is 75 and is financial advisor to the Paul Mellon Family Interests. Barnes is 57. On Friday Mellon reported a 59.8 mln dlr first quarter loss. It had placed 310 mln dlrs of Brazilian loans on a nonaccrual basis and said it would cut its quarterly dividend to 35 cts per share from 69 cts due to energy foreign commercial real estate and heavy industry loans. Reuter | MELLON BANK <MEL> CHAIRMAN RETIRES |
Hungary has announced sharp price increases for a range of food and consumer products as part of its efforts to curb a soaring budget deficit. The official MTI news agency said the government decided consumer price subsidies had to be cut to reduce state spending. From today the price of meat will rise by an average 18 pct and that of beer and spirits by 10 pct MTI said. The measures are also aimed at cooling an overheated economy and could help dampen Hungarians appetite for imported Western goods which consume increasingly expensive hard currency the diplomats said. The diplomats also said however that they did not expect the kind of social unrest that followed sharp price rises in other East Bloc states notably Poland. MTI said consumer goods will also become more expensive with the price of refrigerators rising some five pct. It also announced a number of measures to ease hardship including higher pensions and family allowances. Reuter | HUNGARY RAISES PRICES IN EFFORT TO CURB DEFICIT |
Leaders of the nations unionized automobile workers have signalled their intent for a major work stoppage later this year if General Motors (GM) and Ford Motor Co. fail to satisfy demands for job security pay raises and protection against shifting U.S. production to foreign sources. United Automobile Workers (UAW) president Owen Bieber was loudly cheered by some 3000 local delegates at a special bargaining strategy convention yesterday when he declared the 1.1-mln-member union is ready to go to war against the major auto makers in support of its goals. It takes two to make peace but only one to make war ... and if its war the UAW will be ready for it. War against the insecurity of layoff the UAW chief said. Reuter | UAW CHEERS CALL FOR "WAR" ON GM AND FORD |
P.H. GLATFELTER CO SAYS IT WILL BUY ECUSTA CORP FOR 149 MLN DLRS IN CASH |
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Shr profit one ct vs nil Net profit 74000 vs profit 10000 Revs 925000 vs 112000 Avg shrs 10 mln vs nine mln Six mths Shr loss nil vs loss one ct Net loss 16000 vs loss 90000 Revs 1855000 vs 333000 Reuter | FAMILY HEALTH SYSTEMS INC <FHSY> 2ND QTR FEB 28 |
The Commodity Futures Trading Commission CFTC is expected to accept the Chicago Board of Trades CBT proposal to establish a night trading session when the commission meets Wednesday CFTC officials said. CBT has proposed starting an evening trading session between 1800 and 2100 local time in Treasury bond and Treasury note futures and options on the two futures contracts. The exchange hopes to launch the experiment April 30. While CFTC staff have raised numerous questions about how the evening session will operate they have not discovered any major obstacle to approval CFTC sources said. We are not anticipating any problems with approval a CBT official said. CBT President Thomas Donovan and CBT Chairman Karsten Mahlmann have been in the Far East this month to drum up support for the night session. Reuter | CBT NIGHT TRADING SESSION SEEN GETTING APPROVAL |
1st qtr Shr 1.30 dlrs vs 1.65 dlrs Net 785 mln vs 1.02 billion Gross income 10.68 billion vs 10.13 billion Avg shrs 604.6 mln vs 615.6 mln NOTE: Pretax net 1.34 billion vs 1.83 billion. Sales 6.50 billion vs 6.10 billion maintenance gross income 1.95 billion vs 1.77 billion program products gross income 1.40 billion vs 1.15 billion and rentals and other services 825 mln vs 1.10 billion. Reuter | INTERNATIONAL BUSINESS MACHINES CORP <IBM> NET |
USAir Group Inc said in announcing the final proration factor for its tender offer for Piedmont Aviation Inc <PIE> that 17.0 mln shares or 90 pct of the shares were validly tendered. USAir said it has purchased and will pay for 9.3 mln shares representing about 55 pct of those tendered. Reuter | USAIR <U> REPORTS FINAL PRORATION FACTOR |
The number of British gold articles hallmarked during the first quarter of this year rose by more than 11 pct on the corresponding period last year figures released by the Assay Offices of Great Britain show. More than 2.5 mln British items were hallmarked during the quarter up 11.1 pct on the same year ago period. The four Assay Offices also marked 832222 foreign gold articles up 2.5 pct on last year. In weight terms the 7.19 mln grams of British gold assayed was a 15.3 pct increase while the 2.95 mln grams of foreign gold represented a rise of 3.1 pct. British silver goods assayed totalled 698132 an increase of 6.2 pct but only 78457 foreign items were marked a fall of 11.1 pct. A total of 10968 kilos of silver were assayed an 11.1 pct rise. The number of platinum items marked fell 12.5 pct to 1785 while in weight terms the total slipped 8.1 pct to 9849 grams. A spokesman for the Assay Offices of Great Britain said he was particularly encouraged to see the percentage increase for British manufactured goods. Reuter | MORE BRITISH GOLD ARTICLES HALLMARKED |
Texaco Inc.s plunge into bankruptcy to shield it from posting a bond in its 10.53 billion dlr legal battle with Pennzoil Co. <PZL> is a strategy that will give it breathing room until the fight over the 1984 acquisition of Getty Oil Co. winds its way up to the U.S. Supreme Court analysts said. Texaco the nations third-largest oil company filed for protection under Chapter 11 of the U.S. bankruptcy code earlier today saying it had no choice because of Pennzoils refusal to negotiate a reasonable settlement. But unlike most Chapter 11 cases the Texaco proceeding should not result in a major reorganization of the company or affect its daily business operations several experts said. This is another piece of financial history Sanford Margoshes an analyst with Shearson Lehman Brothers said of the bankruptcy filing. What Texaco is doing is buying time to fight its battle in the courts. They have high hopes they will be upheld if the case goes all the way to the U.S. Supreme Court. Margoshes said he did not anticipate any significant changes in Texacos oil exploration and production business because the bankruptcy filing affects only about four pct of the giant oil companys 32.6 billion dlrs in annual revenues. Texaco executives said the bankruptcy filing would effectively halt payments of stock dividends and repayment of its 6.8 billion dlr debt but added that the companys assets far exceeded its liabilities. Texacos cash flow is at a very respectable rate of about 15 dlrs per share annually Margoshes said. Obviously the point of Chapter 11 was not so much seeking protection from creditors as it was seeking protection from the predator Pennzoil. The two companies have been locked in an acrimonious struggle since a Texas state court jury in November 1985 ordered Texaco to pay Pennzoil 10.53 billion dlrs for improperly interfering with Pennzoils planned acquisition of Getty Oil Co. In a major setback for Texaco last week the U.S. Supreme Court said Texaco must abide by Texas state law that requires posting a bond for the full amount of the judgment while the merits of the case were appealed. Although a Texas appeals court hearing was scheduled Monday (April 13) on Texacos motion to reduce the amount of the bond required under state law Texaco elected not to risk losing the important court ruling that could have required it to post more than 10 billion dlrs in collateral. The bankruptcy filing analysts said effectively freezes all of Texacos obligations while it continues to appeal the merits of the Pennzoil lawsuit. This is a drastic measure said Rosario Ilacqua an analyst with L.F. Rothschild in New York. But its also an indictment of the legal system in this country in that Texaco was forced to seek bankruptcy when it couldnt get a fair hearing. Ilacqua predicted that the Texas jury judgment would ultimately be overturned or whittled down from its original 10.53 billion dlrs an amount that is increasing by about 2.5 mln dlrs in interest accumulated daily. Texaco has contested the ruling insisting that Pennzoil did not have a valid contract under New York state law to acquire Getty Oil. Suggestions by some experts that the Texaco bankruptcy might be an incentive for Pennzoil to lower its settlement demands which are widely believed to be between 3 billion and 5 billion dlrs were discounted by indignant Pennzoil executives. I think it makes it much more difficult to settle said Baine Kerr Pennzoils retired president who has acted as the companys chief negotiator in the Texaco litigation. I think thats one of the main reasons they did it. Joseph Jamail a Houston lawyer for Pennzoil said the company had made its latest settlement offer to Texaco on Saturday and was taken by surprise when Texaco filed for bankruptcy. He declined to reveal the amount of the proposal citing a confidentiality agreement between the two companies. Texaco told us they would get back to us but instead they chose to go to bankruptcy court Jamail said. This was an irresponsible and unneeded move. Ilacqua also said the bankruptcy filing appeared to eliminate any chance of settlement in the near-term. There have been some crazy numbers floating around in settlement discussions Ilacqua said. I think 1 billion dlr settlement would be more than adequate for Pennzoil. I dont know if that Texas jury really understood what money is. They gave Pennzoil an astronomical judgment. Analysts said they expected Texaco stock which closed Friday at 31 and 7/8 to slip to about 25 when the New York Stock Exchange opened Monday morning. Lawyers for Pennzoil said they believed the company would prevail in court appeals adding that Texacos assets were ample enough to ultimately pay the Pennzoil judgment in full. Reuter | TEXACO <TX> USES BANKRUPTCY COURT TO BUY TIME |
Sight deposits of commercial banks at the Swiss National Bank fell 4.64 billion Swiss francs to 7.88 billion in the first 10 days of April the National Bank said. Foreign exchange reserves rose by 9.4 mln francs to 33.12 billion. Sight deposits are an important measure of money market liquidity in Switzerland. The National Bank said banks repaid around 5.8 billion francs of traditional central bank credit taken out to meet their end-of-quarter liquidity requirements. This was partially offset by new swap arrangements. Bank notes in circulation fell 440.2 mln francs to 24.48 billion while other deposits on call at the National Bank -- mainly government funds -- fell 840.5 mln francs to 941.5 mln. REUTER | SWISS SIGHT DEPOSITS FALL 4.64 BILLION FRANCS |
The Bank of England said it provided the market with a further 68 mln stg assistance this afternoon bringing its total assistance on the day to 143 mln stg. Shortly before the Bank said it had revised its estimate of the shortage up to 450 mln stg from the earlier forecast of 400 mln. During the afternoon the bank bought 22 mln stg of band two bank bills at 9-13/16 pct and two mln stg of local authority bills plus 44 mln stg of bank bills in band four at 9-11/16 pct. These rates were in all cases unchanged from previous intervention levels. REUTER | U.K. MONEY MARKET GIVEN FURTHER 68 MLN STG HELP |
Goodyear Tire and Rubber Co said it expects to report earnings from continuing operations of over one dlr per share on 71.3 mln average shares outstanding. In last years first quarter the company lost 60.0 mln dlrs or 55 cts per share on 108.4 mln shares outstanding after a 110.8 mln dlr writedown of oil reserves of its Celeron Corp unit. Goodyear said it will report first quarter results April 27. Goodyear chairman Robert E. Mercer also told the annual meeting that unless there is a major downturn in the economy it expects to work its debt down to normal levels in three years through its restructuring and cash flow from improved margins. The company set up its restructuring program to fend off a hostile takeover attempt by Sir James Goldsmith. As part of the restructuring Goodyear executed a major stock buyback program that resulted in an increase in its debt. Reuter | GOODYEAR <GT> PREDICTS FIRST QUARTER NET |
Taiwan announced plans for another round of import tariff cuts on 862 foreign goods shortly before trade talks with Washington which officials described as a move to help balance trade with the United States. Wang Der-Hwa Deputy Director of the Finance Ministrys Customs Administration Department on Saturday told reporters the list of products included 60 items asked by Washington. He said the ministry sent a proposal to the cabinet that the tariffs on such products as cosmetics bicycles apples radios garments soybeans and television sets be cut by between five and 50 pct. The cabinet was expected to give its approval next Thursday and the new tariff cuts would be implemented possibly starting on April 20 he added. Reuter | TAIWAN ANNOUNCES NEW ROUND OF IMPORT TARIFF CUTS |
Prime Ministers Zhao Ziyang of China and Anibal Cavaco Silva of Portugal signed an agreement to end more than four centuries of Portuguese rule over the territory of Macao and return it to Chinese control in 1999. Macao will become a special administrative region on December 20 1999 retaining a high degree of autonomy except in foreign affairs and defence. Its capitalist system is to remain intact for 50 years under an arrangement similar to the one that will return Hong Kong to China from Britain in 1997. China hopes to win back the Nationalist-ruled island of Taiwan under the same one country two systems formula. Reuter | CHINA AND PORTUGAL SIGN MACAO DEAL |
Chicago Mercantile Exchange floor traders and commission house representatives are guesstimating todays hog slaughter at about 280000 to 300000 head versus 294000 week ago and 303000 a year ago. Cattle slaughter is guesstimated at about 120000 to 126000 head versus 120000 week ago and 124000 a year ago. Reuter | HOG AND CATTLE SLAUGHTER GUESSTIMATES |
Member states of the European Community are starting to run out of patience with Japan which they believe has repeatedly promised major initiatives to open its market to imports but as often made only minor moves. Diplomatic sources here said several recent actions by EC countries bear witness to a new disillusionment with the willingness or at least the ability of the Japanese government to reduce its massive trade surplus with the EC. However they said an all-out trade war may be far off as EC states know they would suffer almost as much as Japan. Senior EC diplomats gave a generally favourable reaction to an EC executive commission proposal under which the EC could raise tariffs on a range of Japanese products if the U.S. Carries out a threat to make a similar move on April 17. The EC tariffs which would involve renouncing obligations entered into with the world trade body GATT would be designed to stop a diversion of exports to the EC market from that of the U.S. The diplomats were meeting as Tokyo announced that the ECs trade deficit with Japan reached a record 2.13 billion dlrs in March up from 1.94 billion in February. Reuter | TRADE ISSUES STRAINING EC'S PATIENCE WITH JAPAN |
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