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Indonesias state oil company Pertamina has informed its affiliated Japanese companies that crude oil supplies will be 40 pct less than contractual volumes in July a spokesman for an affiliated company said. He said the allocations were in line with Indonesias production ceiling under its current OPEC quota so they might be increased if OPEC ratifies a production rise next week. Allocations of Indonesias main traded crude Minas had been cut by 50 pct and Duri by 38 pct he said. Last month contractual volumes were cut by 30 pct. Contractual volumes assume no production ceiling. Oil traders said Indonesian grades were already trading above their official selling prices (osp) on the spot market due to strong demand from Japan and the U.S. And tight supplies. A cargo of Duri loading in July was reportedly traded yesterday at 70 cents over its osp of 15.60 dlrs per barrel and Minas is trading about 20 cents higher they said. REUTER | INDONESIA CUTS JULY CRUDE SUPPLIES TO JAPAN |
FRENCH OFFICIAL RESERVES 420.50 BILLION FRANCS IN MAY VS 420.24 BILLION APRIL - OFFICIAL |
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Vietnams parliament sacked Prime Minister Pham Van Dong and President Truong Chinh but the choice of their successors indicated the influence of the old guard may not be over diplomatic sources said. Dong prime minister for 32 years left in fading health at the age of 81. He is a popular hero of wars against France and the United States and a staunch ally of the Soviet Union. Parliament replaced him with second-ranked politburo member Pham Hung 74 the Vietnam News Agency said. Hung headed the Viet Cong guerrillas in the Vietnam War. Diplomats in Bangkok said Hung not a noted supporter of economic and political reforms had been widely tipped for the less important presidency. That post went instead to Vo Chi Cong a technocrat who ranks third in the politburo. Diplomatic sources said Cong was more in tune with the national economic and political changes being pushed by reformists who apparently had gained the upper hand in the all-important politburo in December. Chinh a hardline Marxist and a veteran of the wars against France and the U.S. Was ousted at the age of 80. His political stance had recently softened the sources said. REUTER | VIETNAM PARLIAMENT FIRES PRIME MINISTER, PRESIDENT |
Mazda Motor Corp <MAZT.T> predicted a parent company current profit of 10 billion yen in the year ending October 31 1987 down 50.8 pct from a year earlier assuming a yen/dollar value at 147 yen vice president Yoshihiro Wada told a press conference. Sales in 1986/87 were estimated at 1640 billion yen up 0.9 pct from a year earlier. The company earlier posted a parent net profit of 1.59 billion in the first half ended April 30 down 76.9 pct from a year earlier on sales of 804.02 billion down 4.2 pct. The fall was due to the yen rise against the dollar which cut 55 billion yen off sales Wada said. The average value of the dollar was 155 yen in the period from 190 a year earlier. Mazda estimated vehicle exports at 1.12 mln including kit parts in the year to October 31 up 6.8 pct from a year earlier and domestic sales at 360000 up 0.8 pct he said. Kit exports should rise because kits sold to Kia Motor Corp <KIAM.SE> unit <Kia Industrial Corp> which is eight pct owned by Mazda and to a Mexico unit of Ford Motor Co <F> will rise to 150000 from 9000 pushing kit exports up 45.3 pct to 260000 he said. Mazda has yet to decide whether to pay an unchanged four yen dividend for the second half but it will pay an unchanged 3.50 yen for the first half Wada said. REUTER | MAZDA SEES 50.8 PCT DROP IN 1986/87 CURRENT PROFIT |
French official reserves rose 258 mln francs in May to 420.50 billion francs from 420.24 billion at the end of April the Finance Ministry said. The slight rise partly reflected the repayment last month of Frances outstanding 11.95 billion francs of debt owed to the European Monetary Cooperation Fund (FECOM). It also reflected a negative 314 mln franc position with Frances Exchange Stabilisation Fund after intervention purchases of 10.6 billion francs during May. Foreign currency holdings fell 7.28 billion francs to 124.58 billion while ECU holdings fell by 5.55 billion francs to 58.52 billion due to the repayment of part of Frances debt owed to the FECOM and Stabilisation Fund operations the ministry said. Claims on the IMF rose 1.14 billion francs to 18.97 billion including a 385 mln franc increase in Frances reserve position with the IMF and a 751 mln franc rise in holdings of Special Drawing Rights. Gold holdings were unchanged at 218.46 billion francs. REUTER | FRENCH OFFICIAL RESERVES RISE IN MAY |
The New Zealand governments sale of a 25 pct stake in Air New Zealand would release the airline from the shackles of burdensome government processes managing director Norman Geary told reporters. Civil Aviation minister Richard Prebble said today the government would sell 25 pct of the airline to the public. Geary said the company had proposed the sale in 1984. With our company we believe there will be considerable New Zealand interest (in the shares) and we would hope for a strong private interest he said. Geary said he was keen to see a large staff shareholding. REUTER | AIR NEW ZEALAND WELCOMES GOVERNMENT SHARE SALE |
Yugoslavia has signed up for a 550 mln ECU loan from the European Community (EC) the official Tanjug news agency said. It said the agreement which has yet to be ratified by the 12 EC countries and the European Parliament was signed last night in Brussels. The 20 year 7.5 pct interest loan will be used to complete the trans-Yugoslavia motorway and modernise the countrys railway network the agency said. Yugoslavias request for a 100 mln ECU grant was refused by the EC but will be discussed again Tanjug added. REUTER | YUGOSLAVIA SIGNS FOR 550 MLN ECU LOAN |
The French governments privatisation program which began late last year has earned the French State about 52 billion francs to date the Finance Ministry said. Sources close to Finance Minister Edouard Balladur said the revenues raised from the privatisation program would be used in priority to pay off public debt which stood at 398.2 billion at the end of 1986. The Ministry said in a communique that the returns included banking group Societe Generale <SGEN.PA> which began its two-week public flotation last Monday. The government has carried out eight flotations as well as the private sale of telephone group <Cie Generale de Constructions Telephoniques> (CGCT) since its denationalisation scheme began last December with the sell-off of glass makers Saint-Gobain <SGEP.PA> it added. The government has pledged to privatise 66 state-owned industrial banking and insurance companies by 1991. Other companies to be sold to the private sector in the near future are television network TF-1 later this month and banking group Cie Financiere de Suez <FSPP.PA> in the autumn. The ministry said TF-1s forthcoming sell-off meant that a third of the governments programme would have been completed in less than nine months. Balladur on Sunday rejected press and opposition charges that the share prices for privatised companies had been pitched too low. He said that the average premium of shares trading on the Bourse was between 15 and 30 pct over their offer price. This compared with premiums of between 60 and 80 pct on similar share flotations in Britain. REUTER | FRENCH STATE SELL-OFFS RAISE 52 BILLION FRANCS |
Fiji sugar farmers will receive an interim payment on the 1986 crop four months ahead of schedule in a move aimed at getting harvesting of the drought-hit 1987 crop under way Governor-general Ratu Sir Penaia Ganilau said. Industry sources said latest forecasts for the 1987 crop indicated output of 360000 tonnes well down on the record 501800 tonne tel quel production in the 1986 (May-December) crop year. The previous record was set in 1982 when Fiji produced 486790 tonnes. For the past month Fiji sugar farmers have delayed harvesting the 1987 crop pending a response from the Governor-general to demands following the May 14 coup. Ganilau said in a statement the Fiji Sugar Corp would make a payment of five dlrs per tonne against the final payment for the 1986 crop on the understanding that preparations by growers for commencement of harvesting would be completed at all mills by June 23. Crushing would commence at Labasa and Penang mills on June 23 and at Lautoka and Rarawai mills on June 30 he said. The interim payment to be made on or about June 30 is the full amount of the growers share of 1986 sugar proceeds received to-date. The balance will be paid in October. Growers had also called for the full 1987 forecast price of 23.50 dlrs per tonne of cane to be paid in cash on delivery to the mill but this has been rejected by the state controlled Fiji Sugar Corp Ganilau said. However in addition to the scheduled delivery payment of 14.10 dlrs an additional sum of 2.35 dlrs or 10 pct of the forecast price would be paid on December 15 on all cane harvested by November 30 he said. Ganilau said This will be at least one month in advance of the expected date of payment of the second payment of cane. The balance of the second payment will be made six weeks after the end of crushing. Another demand of Fijis 22000 small farmers was that an estimated 14 mln dlr loan from the Fiji Development Bank (FDB) for the 1983 cane crop rehabilitation programme be written off. The FDB rejected this request. Ganilau said however The bank is prepared to carefully consider requests for rescheduling loan repayments in cases of hardship on a case-by-case basis. In response to a further demand that all soldiers be removed from the cane growing areas Ganilau said the army would restrict its presence in the cane areas. He said he had directed the authorities to issue permits to harvesting gangs cane growers and sugar industry trade unions to hold the necessary meetings in preparation for the commencement of harvest. Senior representatives of the sugar cane growers had indicated a desire to commence the crush as soon as possible he added. REUTER | FIJI MAKES SUGAR PAYMENT TO GET HARVEST STARTED |
Some major Japanese institutional investors are gradually returning to investing in U.S. Treasuries although fear that the dollar has not yet bottomed out has kept others cautiously waiting on the sidelines. Trust banks and some investment trusts are starting to look at buying treasuries for short-term gains while other investment trusts and most life insurers are still wary according to fund managers polled by Reuters. The five percentage point gap between U.S. And Japanese long-term bonds is the major attraction of T-bonds. Most institutions remain sensitive to the prospects of dollar declines after making huge foreign exchange losses on their foreign bond holdings last fiscal year ended March. The seven leading local life insurers alone saw losses on their foreign bond holdings of over 1700 billion yen or some 11.5 billion dlrs in 1986/87 industry sources said. However most institutional investors want to buy U.S. T-bonds due to the absence of profitable domestic instruments. Despite all the negative factors we have definite demand for U.S. Securities said Osamu Fukushima deputy manager of Mitsui Trust and Banking Co Ltds securities department. Another trust bank fund manager said What matters the most are the fundamentals of the U.S. Economy and the competitiveness of U.S. Industry. We are closely watching the growth of U.S. Exports which is an important measure of the fundamental strength of the dollar. The U.S. Trade deficits decline in April was due to a 1.2 billion dlr decline in imports while exports did not show a recovery he said. One life insurance company fund manager said We doubt the U.S. Government will fight the trade and fiscal deficits especially after the announcement of Federal Reserve Board chairman Paul Volckers resignation. The receptive stance of the U.S. Congress on the call for further dollar falls to cut the countrys trade deficit also makes us wary about U.S. Bonds purchases the life insurance company fund manager said. Yuji Miyaji deputy manager of the Sumitomo Trust and Banking Co Ltds securities investment department said We are slowly starting to buy U.S. Bonds because the gap of over 500 basis points between the U.S. And Japan is very attractive However we are pessimistic on the dollars further recovery. We find that U.S. Economic fundamentals have not changed so far. Keijirou Fukushima manager at Yamaichi Investment Trust Management Co Ltds bond portfolio management department said We would like to invest in U.S. Bonds gradually given an improved inflation outlook and the limited chances of a further steep fall in the dollar from now. We have already reduced forward dollar selling volume to 40 pct of our total foreign assets from 60 pct he said. Another life insurance company fund manager said We have started investing in U.S. Treasury securities but only on a trading basis. REUTER | JAPAN INSTITUTIONS EYEING T-BOND INVESTMENT WARILY |
UK MAY ADJUSTED UNEMPLOYMENT FALLS RECORD 64,300 TO 2.95 MLN OR 10.6 PCT - OFFICIAL |
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UK AVERAGE EARNINGS ROSE 6.5 PCT IN YEAR TO APRIL, UNDERLYING RISE 7.75 PCT - OFFICIAL |
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U.K. MANUFACTURING WAGE COSTS RISE 1.0 PCT IN YEAR TO APRIL (MARCH 0.7 PCT RISE) - OFFICIAL |
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U.K. APRIL INDUSTRIAL OUTPUT RISES 0.3 PCT, MANUFACTURING UP 0.55 PCT - OFFICIAL |
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U.K. MAY ADJUSTED M3 RISES PROVISIONAL 2.1 PCT, M0 UP 0.5 PCT - BANK OF ENGLAND |
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MAY AJUSTED STERLING BANK LENDING UP 2.7 BILLION STG AFTER 1.5 BILLION IN APRIL - OFFICIAL |
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U.K. Unemployment fell a record provisional seasonally-adjusted 64300 in May to a total 2.95 mln or 10.6 pct of the workforce the Employment Department said. In April seasonally-adjusted unemployment fell by an upwardly revised 21600 to 3.02 mln or 10.9 pct it said. The unadjusted jobless total in May including school leavers alos fell a record 121000 to 2.99 mln or 10.8 pct from Aprils 3.11 mln 11.2 pct. May was the eleventh successive decline from a peak last summer of 11.6 pct the Employment Department said. Unemployment has fallen to under three mln for the first time in over three years. The May fall of 64000 was the largest drop since records were first kept (in 1948) Employment Minister Norman Fowler said. All regions have seen above average falls in long term unemployment during the past year he added. The last time the adjusted total of unemployed was below three mln was July 1984 while the unadjusted total was last below this level in June 1983. REUTER | U.K. UNEMPLOYMENT FALLS BELOW THREE MLN IN MAY |
U.K. Average earnings rose a seasonally adjusted 6.5 pct in the year to end-April after increasing by 6.7 pct annually in March the Employment Department said. The April index base 1980 was set at a provisional seasonally-adjusted 197.3 up from 194.8 in March. But the underlying rise was 7.75 pct up 0.25 pct from March and back to the same level seen late last year. The underlying rise is adjusted for factors such as back-pay and timing variations. Unit wage costs in U.K. Manufacturing industry rose one pct in the year to April after an upward revised rise of 0.7 pct in the period to March the Department of Employment added. In the three months to end-April such costs were 0.9 pct higher year-on-year compared with a rise of 1.2 pct in the three months to March. Manufacturing productivity in April was 6.1 pct higher than a year ago after a downward revised 6.8 pct increase in March. In the last three months period manufacturing productivity was up 6.7 pct having increased 6.5 pct in the first quarter. REUTER | U.K. EARNINGS UP UNDERLYING 7.75 PCT IN APRIL |
Clearing bank sterling lending to the private sector in May is estimated to have risen by an underlying seasonally adjusted 3.5 billion stg compared with 1.3 billion stg in April and a recent monthly average of 1.4 billion the Banking Information Service said. The unadjusted rise was 2.77 billion stg up from 844 mln in April. The May surge in borrowing from the clearing banks was prompted by the fall in base rates which reached nine pct on May 11 the Banking Information Service said. Borrowing through bill finance and other sources shrank. The increase in lending in May was seen in most categories the Banking Information Service said. In the personal sector on an unadjusted basis mortgage lending rose 544 mln stg compared with 471 mln in April. General consumption went up 399 mln against 355 mln though credit card debt rose only 55 mln compared with 161 mln. Financial sector borrowing was up 734 mln stg in May compared with a net repayment of 60 mln the previous month. Unadjusted private sector deposits increased by 2.37 billion stg against 1.16 billion. Sterling attracted an extra 955 mln stg in deposits from abroad after little change in April. REUTER | U.K. CLEARING BANK LENDING RISES SHARPLY IN MAY |
A commission set up to unravel the affairs of debt-ridden Air Lanka says the airline amassed losses of up to 265 mln U.S. Dlrs in the most devastating financial tragedy in Sri Lankan commercial history. The commission which scrutinised financial dealings from aircraft acquisitions to give-away cookbooks blamed the airlines previous board for the losses. The panel appointed in August by President Junius Jayewardene submitted its report to him on April 20. A copy was obtained by Reuters. The report will be made available to the public by next week. The three-man commission recommended its findings be passed to state law officers to decide whether penal action was necessary against any members of the former board or Air Lankas management. The airline comes under the Defence Ministry a portfolio held by Jayewardene himself. The commission said Air Lankas reports to Jayewardene blurred its true financial health. It said the airline had irretrievably lost its share capital of 3.8 billion rupees. To finance deficits it had also used up a treasury loan of 800 mln rupees and part of foreign currency loans obtained for aircraft purchases and infrastructure needs it said. Air Lanka is thus indebted to overseas lenders to the value of one billion rupees without any productive assets or collateral to provide for its repayment the commission said. It said the airlines losses were assessed at 5.59 billion rupees at March 31 1986. But cumulative losses would reach 7.7 billion implying Air Lanka lost money at the rate of 1.3 billion rupees a year between 1979 when it started and 1986. These results must rank as the most devastating financial tragedy ever suffered in Sri Lankas commercial history the commission said. The report said the airlines dangerously critical financial condition was due to uncontrolled spending -- particularly the way in which the airline expanded its fleet -- poor marketing and extreme laxity in cost controls. It is clear to us that Air Lankas misfortunes are largely of its own creation and that the reponsibility must rest primarily with the board of directors it said. Air Lanka had blamed its problems on the effects on tourism of Sri Lankas Tamil separatist rebellion the depreciating rupee and under-capitalisation. The commission dismissed these as invalid. The report said most of the major problems stemmed from concentration of power by Captain S.R. Wikramanayake who held the posts of both chairman and managing director. It is mainly he who has to be responsible for whatever the status of Air Lanka is in today it said. Wikramanayake resigned with the other board members last November. He could not be contacted for comment. The commission recommended that its findings should be passed to the law officers of the state ... To ascertain if penal action is necessary against any or all members of the former board of Air Lanka or its management staff. The panel recommended equity involvement of one or more foreign airlines in Air Lanka and the granting of maximum concessions to make the carrier attractive to foreign and local investment. It also suggested selling assets such as two Boeing 747s financed by U.S. Dollar loans to reduce debt. It said Air Lanka and the government should renegotiate U.S. Dollar-denominated debts into other currencies which form the core of earnings and obtain lower interest rates. It also proposed negotiations for the return of two Lockheed Tristar L1011-500s now leased to British Airways before the leases expire next March. REUTER | INVESTIGATORS SAY AIR LANKA LOSSES DEVASTATING |
The cantonal government of Zurich wants a proposed federal law making money laundering an offence to punish negligence and not just gross negligence the cantonal information service said. The Zurich authorities said they supported proposals unveiled by the federal government in February to make it a crime for anyone to conceal the origin of money which they have reason to believe was obtained by criminal means. But they argued in a submission on the proposals that the duty of care imposed on financial institutions should make them liable for any negligence. The federal governments proposals which are being circulated for comment before a formal bill is put before parliament would make only gross negligence an offence. The new legislation which is aimed mainly at combatting organised crime is likely to take effect in the early 1990s. REUTER | ZURICH FAVOURS TIGHT "MONEY LAUNDERING" LAW |
The joint committee of Taiwans soybean importers will reopen a tender tomorrow for two shipments of 54000 to 66000 tonnes of U.S. Soybeans a committee spokesman told Reuters. The committee rejected a tender today for a cargo of 27000 to 33000 tonnes on the grounds the prices offered by the U.S. Suppliers were too high he said. The committee will be seeking a further shipment of between 27000 and 33000 tonnes when it reopens the tender tomorrow he added. REUTER | TAIWAN TO REOPEN TENDER FOR U.S. SOYBEANS |
Amro Bank said it is arranging the first guilder multi-option facility for Greenland NV in a loan package of up to 300 mln guilders. The package consists of a 150 mln guilder five year multi-option facility with a tender panel facility for short term advances and a back stop by the syndicate at 0.5 pct above the London Inter Bank Offered Rate (LIBOR) There is also a 150 mln guilder seven year multi-currency term facility at LIBOR plus 0.375 pct for the first three years at LIBOR plus 0.5 pct for the fourth and fifth year and at LIBOR plus 0.625 pct for the remaining two years. Greenland has an option to fix the second facility. Both facilities have a commitment fee of 0.125 pct. Greenland NV a producer of agricultural machines is a subsidiary of the Thyssen-Bornemisza Group. The firm will be floated on the Amsterdam and Toronto stock exchanges in the second half of July. REUTER | AMRO LINES UP FIRST GUILDER MULTI-OPTION FACILITY |
Honda Motor Co Ltd <HMC.T> said its vehicle exports in May fell 11.4 pct from a year earlier to 54982. Honda shipped 34701 vehicles to the U.S. In May up 4.4 pct from a year earlier but total shipments to North America fell 8.3 pct to 39009 due to increased assembly there a company spokeswoman said. Exports to Europe fell 24.8 pct to 12821 she added. REUTER | HONDA EXPORTS FALL IN MAY |
ATT/Philips (APT) the joint venture between American Telephone and Telegraph Co <T> of the U.S. And N.V. Philips Gloeilampenfabrieken <PGLO.AS> said the Spanish government had approved its setting up of a joint venture in Spain. The government had also awarded it an order for the state-controlled Compania Telefonica Nacional de Espana <TELF.MA> (Telefonica) APT said. APT will take a majority stake in a new company to be formed with the Spanish firm <Amper> which will make transmission equipment for Telefonica. The order is expected to be worth some 30 mln dlrs per year. Further negotiations with Telefonica have yet to be concluded however an APT spokesman said. For Philips the order is an important first step into the Spanish market a company spokesman said. REUTER | ATT/PHILIPS VENTURE GETS SPANISH GOVT APPROVAL |
BankAmerica Corp <BAC> asked Japanese commercial banks today to buy 350 mln dlrs in subordinated capital notes and preferred stock that it plans to issue to boost its equity base a company spokesman said. BankAmerica vice chairman Frank N. Newman held a meeting here today to outline its fund-raising plan to some 20 Japanese banks he told Reuters. He also stressed the companys efforts to streamline operations by withdrawing from unprofitable energy-related areas to concentrate more on its Californian home base. But Newman said the company had no intention of selling its Seafirst Corp Subsidiary in Washington. A document obtained by Reuters shows the fund-raising effort involves 250 mln dlrs in 12-year subordinated capital notes and 100 mln in convertible preferred stock. It has made a shelf registration with the SEC so that it can issue debt securities whenever market conditions are favorable. The company already raised 100 mln dlrs in the U.S. Market last month he added. According to the document the 250 mln dlrs in subordinated capital notes will carry an interest rate of 100 basis points over the three-month London Interbank Offered Rate (LIBOR). The minimum rate will be six pct and the maxiumum 12 pct. The notes will be redeemable at par after four years and will also have warrants attached to purchase the firms common stock at 17.50 dlrs. There will be 7.5 mln warrants in all with a term of 10 years. The planned convertible preferred stock will carry a dividend rate equivalent to three months LIBOR plus an as yet undecided premium the document said. There will be no sinking fund for the preferred stock which will have 10-year warrants attached to buy BankAmerica common stock. The rest of the details of the preferred stock issue have yet to be worked out. On both the preferred stock and note issues BankAmerica said that a fixed rate alternative was possible. The document said that BankAmerica was also open to raising funds in yen if that was desirable for the Japanese. Those present at the meeting today were working-level officials from 13 city three long-term credit and seven trust banks Japanese banking sources said. Newman expressed hope that certain banks would act as lead managers of the projected debt securities but did not name specific banks the sources said. No bank made any commitment to the companys fund-raising plan as most knew little about it in advance they said. Todays meeting itself was held with very short-notice and we just cant decide what to do with it said a senior official at a leading city bank. Newman attempted to quell Japanese bankers fears that the U.S. Federal Reserve may insist that they deduct the equivalent amount to the securities purchased from their primary capital under a regulation now being studied by the U.S. And Britain. Newman told them that they should not worry because he understood the U.S. Federal Reserve would not go along with such a regulation the official said. REUTER | BANKAMERICA ASKS JAPAN BANKS TO BUY SECURITIES |
Citibank Ltd said it would lower its Australian prime rate to 16 pct from 16.5 effective tomorrow. The new rate if unmatched by other banks will be the lowest among Australian trading banks. Other primes range from 16.25 to 17.5 pct. Australian prime rates have now retreated from a recent peak of 19 pct in October in line with declining money market levels. Citibank said its reduction reflected the decline. REUTER | CITIBANK LOWERS AUSTRALIAN PRIME RATE TO 16 PCT |
Mazda Motor Corp <MAZT.T> said its vehicle exports fell 2.2 pct from a year earlier to 69191 in May. In May exports included 50800 cars down 4.8 pct from a year earlier and 18391 commercial vehicles up six pct the company said. Mazdas exports to the U.S. Fell 7.8 pct to 35401 and those to Europe fell 2.6 pct to 20809. Exports to South East Asia rose 142.4 pct to 6564 due to higher exports of complete kits to <Kia Industrial Corp>. REUTER | MAZDA EXPORTS FALL IN MAY |
James Hardie Industries Ltd <HAHA.S> said the 28 pct increase in its 1986/87 net profit reflected the benefits of continuing rationalisation and consolidation of Australian activities and expansion in the U.S. The diversified building products group reported net earnings rose to 60.58 mln dlrs in the year ended March 31 from 47.42 mln in 1985/86. It lifted annual dividend to 24 cents from 22 with a final of 13 against 11 previously. Hardie had concentrated resources on building up its core businesses of building products paper merchanting and technology and services it said in a statement. Hardie said it sold a number of businesses during the year which were unable to meet objectives for return on investment or market share and some non-core units. This resulted in a decline in sales to 1.50 billion dlrs from 1.56 billion but also contributed to a fall of about 100 mln dlrs in borrowings by year-end and a 36 pct drop in interest expense to 29.16 mln dlrs it said. Hardie said a 42 pct jump in second-half net earnings to 29.66 mln dlrs from 20.92 mln a year earlier was particularly pleasing in view of the difficult trading conditions faced by the building products businesses in Australia. The problems in U.S. Irrigation operations which adversely affected 1985/86 earnings have been overcome Hardie said. It said the process of rationalisation and consolidation had continued into the current year as had expansion into the U.S. Hardie said it could now look forward to a period of development and further growth in Australia and overseas after carrying through a long and expensive process of eliminating asbestos the groups original prime raw material from its fibre cement building products over the past eight years. REUTER | J. HARDIE SAYS HIGHER NET REFLECTS RATIONALISATION |
Average spending by French ministries will be virtually frozen next year within the framework of a one pct real increase in the overall state budget sources close to French Finance Minister Edouard Balladur said. The sources said priority would be given to defence research and the fight against unemployment which reached 2.66 mln people in April. Prime Minister Jacques Chirac yesterday chaired a ministerial meeting on the budget and Balladur is due to make the final decision at the end of the month. Budget Minister Alain Juppe said yesterday that the government was on course to achieve its target of tax cuts worth 50 billion francs over two years. Juppe gave no details but pledged that the government also planned to cut its budget deficit down to 115 billion francs by 1988 from the 129 billion franc shortfall forecast for 1987. REUTER | 1988 FRENCH MINISTERIAL BUDGETS FROZEN - SOURCES |
Britain withdrew four more diplomats from its diplomatic mission in Tehran leaving only two officials in their posts. The Foreign Office said the four had left Tehran earlier today and would arrive in London tomorrow. Britain and Iran have been embroiled in a three-week-old diplomatic row which began when a British diplomat was beaten and abducted for 24 hours in the Iranian capital.- Reuter | BRITAIN PULLS OUT MORE DIPLOMATS FROM IRAN |
Three U.S. Senators said they will propose a temporary ban on imports of all Toshiba products due to the companys illegal sales of sensitive high-technology goods to the Soviet Union. Senator Jake Garn John Heinz and Richard Selby said at a hearing of the senate banking committee on export control they will offer the proposal as part of a major trade bill when it is brought before the senate this summer. Garn a Utah Republican said I am talking about specific retribution on a company that endangers the security of their own country and ours. Reuter | U.S. SENATORS PROPOSE BAN ON TOSHIBA IMPORTS |
Representatives of the Republic of Chile and its 400-plus international bank creditors started signing agreements to reschedule 10.6 billion dlrs of the countrys foreign debt Manufacturers Hanover Trust Co said. Manufacturers Hanover which chairs a 12-bank advisory committee that agreed the terms of the deal in late February said all of Chiles creditor banks have approved the package. A key feature of the rescheduling agreement is that Chile will avoid the need for fresh bank loans this year and next by making interest payments to the banks every twelve months instead of every six months. Reuter | CHILE SIGNS DEBT RESCHEDULING AGREEMENT |
The U.S. Treasury said it will auction 24.25 billion dlrs of two four and seven year notes next week to raise a total of 8.325 billion dlrs of new cash. The financing will begin with the monthly auction on Tuesday June 23 of 9.75 billion dlrs of two year notes. That will be followed on Wednesday and Thursday by respective quarterly sales of 7.5 billion dlrs of four year notes and 7.0 billion dlrs of seven year notes to refund 15.93 billion dlrs of two year and four year notes maturing June 30. The two year notes mature June 30 1989. The four years mature June 30 1991 with the seven years due July 15 1994. Reuter | U.S TREASURY SELLING 24.25 BILLION DLRS OF NOTES |
Four cargoes of raw sugar were sold to China yesterday via the London trade to supplement the countrys current nearby buying programme traders said. The sugar was reported sold at around 160 dlrs a tonne c and f for July/August shipment or arrival in September they said. Some traders said recent Chinese purchases could total as much as 300000 tonnes but others while agreeing a heavy volume had been taken said an amount less than that figure was involved. China was still believed to be in the market for more sugar traders said. REUTER | FOUR SUGAR CARGOES SOLD TO CHINA YESTERDAY -TRADE |
Texas-New Mexico Power Co a unit of TNP Enterprises Inc said it filed with the Securities and Exchange Commission a registration statement covering 65 mln dlr issue of first mortgage bonds. Proceeds will be used to repay short-term debt and for other general purposes the company said. It said the bonds would probably be offered through Shearson Lehman Brothers Inc and Salomon Brothers Inc. REUTER | TNP ENTERPRISES <TNP> UNIT TO SELL BONDS |
Republic New York Corp said it would add 100 mln dlrs to its allowances for loan losses specifically related to its loan exposure to Latin American customers. Republic New York estimated its second quarter net loss would total about 80 mln dlrs as a result. REUTER | REPUBLIC NEW YORK <RNB> ADDS TO LOAN-LOSS |
Moodys Investors Service Inc said it affirmed the ratings on 2.2 billion dlrs of debt of Republic New York Corp. The agency said Republics 100 mln dlr provision to its loan loss reserve adjusts the institutions financial statement to more accurately reflect economic reality. Affirmed were Republics Aa-3 senior debt A-1 subordinated debt and preferred stock Provisional Aa-3 senior debt shelf and Provisional A-1 subordinated debt shelf. Also affirmed were lead bank Republic Nationals Aa-1 long-term deposit obligations. REUTER | REPUBLIC NEW YORK <RNB> AFFIRMED BY MOODY'S |
USX Corp announced a public offering of 250 mln dlrs of convertible exchangeable cumulative preference stock underwritten by Morgan Stanley and Co Inc and FIrst Boston Corp. USX said the proceeds will be used to redeem its currently outstanding 2.25 dlrs convertible exchangeable cumulative preference stock. USX said the new stock will be offered at 50 dlrs a share and will have a dividend of 3.50 dlrs a share per year. REUTER | USX <X> OFFERS CONVERTIBLE PREFERRED |
Trading in shares of <Dairy Farm International Holdings Ltd> was suspended after the morning session the stock exchange said. It gave no explanation of the move but the company announced it will hold a press conference on a major corporate development this afternoon. The stock last traded at 5.40 H.K. Dlrs down 10 cents from yesterdays close. REUTER | DAIRY FARM SUSPENDS SHARE TRADING IN HONG KONG |
Yr ended March 31 Shr 37.8 cents vs 30.7 Final div 13 cents vs 11 making yr 24 vs 22 Net 60.58 mln dlrs vs 47.42 mln Turnover 1.50 billion vs 1.56 billion Other income 16.84 mln vs 3.73 mln Shrs 161.71 mln vs 154.19 mln. NOTE - Div pay Aug 6. Reg July 17. Div is unfranked and thus will not be tax-free under dividend imputation. Net is after tax 28.39 mln dlrs vs 29.93 mln depreciation 32.05 mln vs 34.59 mln interest 29.16 mln vs 45.74 mln and minorities 1.35 mln vs 9.89 mln but before extraordinary profit 2.28 mln vs loss 31.05 mln. REUTER | JAMES HARDIE INDUSTRIES LTD <HAHA.S> YR TO MARCH |
The Commonwealth Bank of Australia said it will lower its reference rate for loans to 15.75 pct from 16.25 pct and its overdraft reference rate to 16.25 pct from 16.75 effective June 24. Bank officials have said the bank regards the overdraft reference rate based on short-term rate trends as its key prime lending rate to corporate customers. The loan reference rate is based on longer term trends. The bank is the latest to cut prime rates in recent days following a continuing decline in market rates. Other prime rates now range from 16 pct to 17.5 pct. REUTER | COMMONWEALTH BANK CUTS AUSTRALIAN SPLIT PRIME |
Dutch parliamentary parties have re-affirmed their support for the governments opposition to the proposed European Community tax on oils and fats parliamentarians said. A broad cross-section of members of parliament voiced their opposition to the tax during a debate in the lower house yesterday on the basis of possible retaliation from the U.S. And on the potentially damaging effect on Third World countries. State Secretary for Foreign Affairs Rene Van Der Linden said the government was against the tax although it noted deepening EC financial difficulties. It is difficult to be against the tax and against extra finance. The EC members have to make a choice Van Der Linden said. However he denied the government had dropped its opposition to the proposed tax or altered its position. REUTER | DUTCH PARLIAMENT BACKS STAND AGAINST OILS TAX |
CSR Ltd <CSRA.S> said it had declared unconditional its takeover bid for <Pioneer Sugar Mills Ltd> following Pioneers recommendation that shareholders accept. This meant Pioneer shareholders would be paid for all shares tendered within 14 days CSR said in a statement. CSRs statement follows Industrial Equity Ltds <INEA.S> disclosure yesterday that it had built up a 9.8 pct stake in Pioneer at 2.54 dlrs a share topping CSRs cash bid of 2.50. CSR is also offering one share currently worth 4.04 dlrs plus 1.20 cash for every two Pioneer shares which values Pioneer at 2.62 per share. It holds about 33 pct of Pioneer. REUTER | CSR DECLARES PIONEER SUGAR BID UNCONDITIONAL |
Swedens Sandvik AB <SVIK.ST> and Diamant Boart SA of Belgium in which Societe Generale de Belgique <BELB.BR> holds an indirect 52 pct stake have finalised negotiations on merging oil and gas drilling tool activities officials of both companies said. Staffan Paues President of the new Brussels-based joint venture company Diamant Boart Stratabit SA (DBS) told a news conference that the merged firm would be able to offer products for all types of drilling operations. He said there were already signs that a slow recovery from recession was under way in the oil and gas industries. Stability in oil prices should lead to renewed investment Paues said. DBS which Paues said began operations today brings together Sandviks wholly-owned U.S. Subsidiary Strata Bit Corp of Houston and Diamant Boarts petroleum activities in Europe North America the Middle and Far East and Africa. Paues said the merger was a direct result of the sharp fall in oil prices 18 months ago which led oil firms to cut back exploration activities. Officials said the complementary character of the two firms operations was a further reason. REUTER | SANDVIK, DIAMANT BOART FINALISE DRILLS MERGER |
Canadas Foreign Minister Joe Clark said there is greater international recognition on the need to reduce government-imposed subsidies on agricultural produce. There is now recognition that agricultural subsidies must be reduced and other reform measures pursued Clark told a conference of ASEAN (Association of South East Asian Nations) foreign ministers and their counterparts from six industrialised countries. A delegate said Clarks call for halting the subsidy war in the agricultural products to ensure a stable world trading system received warm support from Japan and Australia. Clark said the Organisation of Economic Cooperation and Development (OECD) has called for reduction of direct and indirect subsidies and avoidance of predatory or protectionist trade practices. The OECD stand was endorsed by the Venice economic summit this month. However he said he did not expect any quick solution to the subsidy problem. Clark said Canadian farmers like those of ASEAN are caught in the cross-fire of an agricultural subsidy war that is not of our making. Clark said his country will provide 10 mln Canadian dlrs as aid over thu next five years to developing countries of the South Pacific region to finance fisheries and other marine projects. The new program which we estimate will cost about two mln Canadian dlrs a year will be implemented by te International Centre for Ocean Development (ICOD) in close cooperation with the major South Pacific regional organisations he said. REUTER | CANADA SEES GLOBAL ACTION TO REDUCE FARM SUBSIDY |
THOMSON GRAND PUBLIC TAKES OVER THORN EMI'S AUDIOVISUAL DIVISION - THOMSON |
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Thomson Grand Public the subsidiary of Thomson SA <THMP.PA> has taken over the audiovisual consumer goods division of British group Thorn EMI Thomson Grand Public chairman Pierre Garcin said. The cost of the deal signed late yesterday is around 90 mln stg and Thomson will finance 50 mln of this from its equity. Thorn EMI is a leader in the British audiovisual market with a turnover last year of 300 mln stg. Garcin said the new acquisition would substantially increase Thomsons turnover in the sector. REUTER | THOMSON TAKES OVER THORN EMI AUDIOVISUAL |
The 37635 deadweight tonnes bulk carrier Cumberlande which sank in the South Pacific last Friday was carrying a cargo which included lead as well as magnesium ore a Lloyds Shipping Intelligence spokesman said. He was unable to confirm the tonnages involved. Trade reports circulating the London Metal Exchange said the vessel en route to New Orleans from Newcastle New South Wales had been carrying 10000 tonnes of lead concentrates. Traders said this pushed lead prices higher in early morning trading as the market is currently sensitive to any fundamental news due to its finely balanced supply/demand position and low stocks. Trade sources said that 10000 tonnes of lead concentrates could convert to around 5000 tonnes of metal although this depended on the quality of the concentrates. A loss of this size could cause a gap in the supply pipeline particularly in North America they noted. Supplies there have been very tight this year and there is a strike at one major producer Cominco and labour talks currently being held at another Noranda subsidiary Brunswick Mining and Smelting Ltd. REUTER | VESSEL LOST IN PACIFIC WAS CARRYING LEAD |
French mortgage refinancing agency Caisse de Refinancement Hypothecaire (CRH) has cancelled todays auction of between one and two billion francs worth of tap stock the Bank of France said. In a statement the agency cited exceptional circumstances on the bond market which resulted in a low level of applications. Todays issue would have been a new tranche of the agencys March 1987 8.50 pct 12 year issue. At its last auction in May the CRH sold 2.02 billion francs worth of the stock at a top accepted price of 91.10 pct giving an average 9.79 pct yield. REUTER | FRANCE'S CRH CANCELS TWO BILLION FRANC TAP ISSUE |
Dome Petroleum Ltd said one of its common shareholders filed a class action suit in a New York court alleging the company its chairman and president breached their fiduciary duties concerning Amoco Corps proposed takeover of Dome. Dome said the suit filed by counsel representing Allen B. DeYoung who holds 100 Dome common shares names Dome chairman J. Howard Macdonald president John Beddome as defendents as well as Amoco and Amocos Canadian unit Amoco Canada Petroleum Co Ltd. Dome said the class action suit filed in United States district court in New York seeks a court order declaring the Dome-Amoco takeover null and void or compensation in excess of 100 mln dlrs in actual damages plus compensation for any consequential damages. The suit also seeks to block a provision in the merger agreement for Dome to sell to Amoco its Primrose Alberta heavy oil properties for 79 mln dlrs if the takeover is not completed. Reuter | DOME <DMP> SHAREHOLDER FILES CLASS ACTION SUIT |
Texas-New Mexico Power Co a unit of TNP Enterprises Inc said it filed with the Securities and Exchange Commission a registration statement covering 65 mln dlr issue of first mortgage bonds. Proceeds will be used to repay short-term debt and for other general purposes the company said. It said the bonds would probably be offered through Shearson Lehman Brothers Inc and Salomon Brothers Inc. Reuter | TNP ENTERPRISES <TNP> UNIT TO SELL BONDS |
JWT Group Inc said it filed a suit against <WPP Group Plc> to enjoin the company from continuing its tender offer. The company said it charged that former JWT Group unit executive John Peters has breached his fiduciary duty by disclosing confidential information about the company and its clients. The company said the suit filed in New York State Supreme Court seeks to halt the ongoing misuse and misappropriation of highly confidential and proprietary information concerning JWT and its clients. The defendants in the suit are WPP Group and its units and Peters who until January 29 was a director of J. Walter Thompson Co JWT Groups main subsidiary and its president and chief operating officer. JWT said it asked the court to enjoin the defendants from acquiring any further JWT stock make them return all confidential and proprietary information and to disgorge all profits or other gains. The company said it also asked the court to award JWT unspecified damages. Reuter | JWT GROUP <JWT> SUES WPP GROUP PLC |
JWT Group Inc disclosed in a filing with the Securities and Exchange Commission that it awarded so-called golden parachutes to 26 top officers. The company said it granted the special bonuses which take effect only if an executive is fired within two years of a successful takeover on June 8. It granted 25 of the officials a severance payment of just under three times their annual compensation if they are fired after a takeover. For chairman Don Johnston the payment was limited to twice his annual compensation. JWT approved additional lump-sum payments of one years compensation to an unspecified number of other highly paid company officials. The company also altered its employee retirement and stock incentive plans to assure continued protection and benefits for employees in the event of a hostile takeover. The company did not disclose the cost of the changes made in the severance retirement or stock plans. Reuter | JWT GROUP <JWT> GRANTS GOLDEN PARACHUTES |
A spokesman for Unilever Plc <UN.AS> declined to comment on market rumours that it may be considering a bid for the U.S. Health care group The Gillette Co <GS.N>. Gillette shares are traded on the over-the-counter market in London and this morning stood one dollar higher at 38 dlrs in response to the bid speculation. Unilever dipped 33p to 3275 in a generally depressed U.K. Market. Most analysts dismissed the rumours saying it was an old story and one commented that it was utter rubbish adding he thought Unilever would not be interested in Gillette. Gillette shares rose sharply at the beginning of the month on Wall Street rumours that Sir James Goldsmith was building a stake in the company. Gillette has been the subject of repeated rumours since Ronald Perelman chairman of the Revlon Group Inc <REV> made an unsuccessful bid for the company last year. REUTER | UNILEVER DECLINES COMMENT ON GILLETTE BID RUMOURS |
Private Export Funding Corp PEFCO is offering 150 mln dlrs of secured notes due 1994 with an 8.60 pct coupon and par pricing said J.P. Morgan Securities Inc acting as lead manager of its first corporate debt deal. To our knowledge this is the first time that an affiliate of a bank holding company has been a manager of a corporate bond offering in the U.S. a spokesman for J.P. Morgan and Co Inc said. J.P. Morgan Securities is an affiliate of J.P. Morgan and Co the fifth largest bank in the U.S. The J.P. Morgan spokesman explained that because the PEFCO notes are guaranteed by the U.S. government the securities affiliate was not prohibited by the Glass-Steagall Act from underwriting the issue. Indeed Bankers Trust Co and Citicorp Investment Bank which are affiliates of Bankers Trust New York Corp and Citicorp respectively were co-managers of the PEFCO offering. Passed by Congress in 1933 Glass-Steagall bars commercial banks from owning brokerage firms and engaging in such investment banking activities as underwriting corporate securities or municipal revenue bonds. Last year several major U.S. banks formed investment banking affiliates and applied to the Federal Reserve Board for authorization to offer commercial paper and underwrite and trade municipal revenue bonds and some forms of mortgage-backed securities. J.P. Morgan Securities received permission from the Fed several weeks ago for these activities the spokesman said. But the Securities Industry Association a trade group of investment banking firms appealed the decision. J.P. Morgan also appealed because it believed the Fed placed too many restrictions on the banks affiliate the spokesman said. The Securities and Exchange Commission got a stay so we are not engaging in those activities the J.P. Morgan spokesman said. We are perfectly eligable to underwrite this offering. We are endeavoring to prove that there is nothing mysterious about this business the spokesman said. He added Ruling off certain markets does not serve the public policy. J.P. Morgan Securities was formed in April 1986 with capitalization of 250 mln dlrs the spokesman said. At year-end 1986 the firm had 261.5 mln dlrs of capital. Dillon Read and Co Inc Merrill Lynch Capital Markets and Salomon Brothers Inc also served as co-managers of the PEFCO deal. The issues yield was 50 basis points over comparable Treasury securities. The notes are non-callable for life. A top-flight AAA rating by Moodys and Standard and Poors is anticipated. The gross spread is 5.75 dlrs the selling concession is 3.50 dlrs and the reallowance is two dlrs. The spokesman said J.P. Morgan Securities was a member of an underwriting syndicate for a Sallie Mae issue last year. Reuter | PEFCO SELLS NOTES VIA J.P. MORGAN SECURITIES |
British Telecommunications Plc <BTY.L> said it looked to further progress this year after reporting a 11.7 pct rise in 1986/87 pretax profits to 2.07 billion stg. The result was at the top end of market expectations but the shares nonetheless declined from last nights closing levels to stand 12p lower at 303p at 1130 GMT. Telephone call income rose 9.5 pct to 4.97 billion while rental income increased 10.6 pct to 3.06 billion. The company said it had not paid anything through its profit-sharing scheme after 18 mln stg last year considering such payments inappropriate after a series of strikes. It said total operating costs rose 806 mln stg to 7.08 billion while its basket of across-the-range tariffs had been reduced overall by 0.3 pct last November under arrangements set up before privatisation. Despite the rise in profits taxation rose only 11 mln stg to 754 mln reflecting the cut in U.K. Corporation tax to 35 pct from 40 pct during the year. Gearing fell to 33 pct from 39 pct. Price regulation formulae were introduced for both the previously state-owned utilities that have been floated off. Yesterday British Gas Plc <BRGS.L> said it was cutting tariffs for domestic customers by about 4.5 pct. BT chairman Sir George Jefferson said work on new digital exchanges and optical fibre links will continue and the fight against vandalism of public call boxes would go on. We have been spending 160 mln stg over three years modernising and expanding our payphone service to make our call boxes more reliable and harder to vandalise. Expenditure on digital exchanges was about 500 mln stg and progress had been made in installing optical fibre. REUTER | BRITISH TELECOM LOOKS FORWARD TO MORE PROGRESS |
Exide Corp is raising 135 mln dlrs via an offering of senior subordinated notes due 1997 yielding 13.01 pct said sole manager Drexel Burnham Lambert Inc. The notes have a 12-7/8 pct coupon and were priced at 99.25 Drexel said. The issue is non-callable for three years and non-refundable for five years. Moodys rates the notes B-2 and Standard and Poors rates them B-minus. The gross spread is 33.75 dlrs the selling concession is 21 dlrs and the reallowance is 2.50 dlrs. Reuter | EXIDE SELLS 10-YEAR SENIOR SUBORDINATED NOTES |
Olin Corp is raising 125 mln dlrs via an offering of 10-year subordinated notes yielding 9.558 pct said lead manager Morgan Stanley and Co Inc. The notes have a 9-1/2 pct coupon and were priced at 99.625 to yield 134 basis points more than comparable Treasury securities. Non-callable for life the issue is rated Baa-2 by Moodys and BBB-minus by Standard and Poors. The gross spread is seven dlrs the selling concession is four dlrs and the reallowance is 2.50 dlrs. Salomon Brothers co-managed the deal. Reuter | OLIN <OLN> SUBORDINATED NOTES YIELD 9.558 PCT |
Fletcher Challenge Finance USA Inc a unit of Fletcher Challenge Ltd is raising 190 mln dlrs via an offering of notes due 1997 yielding 9.28 pct said sole manager First Boston Corp. The notes have a 9-1/4 pct coupon and were priced at 99.80 to yield 105 basis points more than comparable Treasury securities. Non-callable to maturity the issue is rated a top-flight Aaa by Moodys and Standard and Poors. The gross spread is 6.50 dlrs the selling concession is four dlrs and the reallowance is 2.50 dlrs. Reuter | FLETCHER CHALLENGE UNIT SELLS 10-YEAR NOTES |
McDonnell Douglas Corp said it has received an order from Thai Airways International for one McDonnell Douglas DC-10 Series 30ER aircraft and four MD-11 long-range trijets plus options for four more MD-11s. The company said the nine aircraft together with two other DC-10ERs ordered earlier this year by Thai Air are worth about one billion dlrs. It said the DC-10 is scheduled for April 1988 delivery and the first two newly ordered MD-11s in September and November 1990 with the others two in October and November 1991. McDonnell Douglas said the DC-10 will be powered by General Electric Co <GE> CF6-50C2 engines and the MD-11s by GE CF6-80C2 engines. Reuter | MCDONNELL DOUGLAS <MD> GETS BIG THAI AIR ORDER |
Commonwealth Edison Co is raising 140 mln dlrs through an offering of first mortgage bonds due 1994 yielding 8.92 pct said lead manager Salomon Brothers Inc. The bonds bear an 8-7/8 pct coupon and were priced at 99.765 to yield 85 basis points more than comparable Treasury securities. Non-callable for five years the issue is rated A-3 by Moodys and A by Standard and Poors. The gross spread is 6.50 dlrs the selling concession is four dlrs and the reallowance is 2.50 dlrs. Morgan Stanley co-managed the deal. Reuter | COMMONWEALTH EDISON <CWE> SELLS SEVEN-YEAR BONDS |
Service Resources Corp said it has withdrawn and terminated its 23 dlr per share takeover offer to Sorg Inc because Sorg failed to respond to the bid. It said as Sorgs largest single shareholder it will evaluate all its options including making a further offer to Sorg or disposing of some or all of its Sorg shares. Reuter | SERVICE RESOURCES <SRC> ENDS SORG <SRG> BID |
Exide Corp is raising 135 mln dlrs via an offering of senior subordinated notes due 1997 yielding 13.01 pct said sole manager Drexel Burnham Lambert Inc. The notes have a 12-7/8 pct coupon and were priced at 99.25 Drexel said. The issue is non-callable for three years and non-refundable for five years. Moodys rates the notes B-2 and Standard and Poors rates them B-minus. The gross spread is 33.75 dlrs the selling concession is 21 dlrs and the reallowance is 2.50 dlrs. Reuter | EXIDE SENIOR SUBORDINATED NOTES YIELD 13.01 PCT |
Joy Technologies Inc is raising 185 mln dlrs through an offering of senior subordinated debentures due 1999 yielding 13.85 pct said lead manager Kidder Peabody and Co Inc. The notes have a 13-3/4 pct coupon and were priced at 99.396 Kidder said. The issue is non-callable for five years. Moodys rates the debt B-1 compared to a B-minus grade by Standard and Poors. Donaldson Lufkin and Jenrette co-managed the deal. Reuter | JOY TECHNOLOGIES SELLS 12-YEAR DEBENTURES |
Robert Salomon managing director of Salomon Inc said the companys second quarter is likely to be comfotrably in the black but down from the comparable year-ago quarter when Salomon earned 117 mln dlrs or 78 cts a share on a primary basis. Its been a difficult quarter Salomon told Reuters adding that financial analysts today lowered their second quarter earnings estimate for the company to 30 cts to 50 cts per share from a range of 75 cts to 80 cts a share. Salomons stock closed at 34-3/4 off one on heavy trading. Salomon said he was deluged with calls from analysts after yesterdays announcement by First Boston Inc <FBC> that it will report a loss for the second quarter due to steep losses in the bond market during April. Salomon acknowledged that the quarter was difficult but said the company will report a profit for the period. Reuter | SALOMON <SB> SEES LOWER 2ND QTR |
Thrifty Rent-A-Car System Inc the fifth largest car rental company in North America said it filed with the Securities and Exchange Commission for an initial public offering of two mln shares of comon stock. Thrifty said the offering represents about one-third of the companys outstanding and current stockholders will retain a majority two-thirds ownership of the company. Alex. Brown and Sons Inc will be managing underwriter. Reuter | THRIFTY RENT-A-CAR IN INITIAL OFFERING |
Halcyon Investments a New York firm reported a 6.9 pct stake in Research-Cottrell Inc. Alan Slifka a partner in Halcyon told Reuters the shares were purchased for investment purposes but declined further comment. On June 8 Research-Cottrell said it had entered into a definitive agreement to be acquired by R-C Acquisitions Inc for 43 dlrs per share. Research-Cottrell closed at 44-1/4 today unchanged from the previous close. Reuter | HALCYON HAS STAKE IN RESEARCH-COTTRELL <RC> |
April 30 end Shr loss 13 cts vs shr profit 12 cts Net loss 4116000 vs net profit 3672000 Revs 61.1 mln vs 55.5 mln Avg shrs 32263000 vs 31640000 12 months Shr loss 86 cts vs shr profit 42 cts Net loss 27.6 mln vs net profit 13 mln Revs 174.9 mln vs 189.3 mln Avg shrs 32184000 vs 30938000 NOTE: Both 1987 and 1986 figures restated to reflect April 21 1987 acquisition of Distribution Management Systems Inc accounted for as a pooling of interests. 1987 results include a first quarter non-recurring charge of 7 mln dlrs with an after-tax impact of 11 cts per share attributable to the write-off of the remaining assets acquried from Computer Pictures Corp in November 1982. Reuter | CULLINET SOFTWARE INC <CUL> 4TH QTR EARNINGS |
A spokesman for a group of United Airlines employees who oppose the attempted takeover of United by the Airline Pilots Association said he met with the new chairman of Allegis Frank Olson. William Palmer the groups spokesman which claims to speak for thousands of United employees said the meeting with Olson was positive and friendly but no future meeting dates were set. In April the pilots union offered to buy out United an Allegis subsidiary through an employee stock ownership plan. Reuter | ALLEGIS <AEG> MEETS WITH UNITED EMPLOYEES GROUP |
USX Corp announced a public offering of 250 mln dlrs of convertible exchangeable cumulative preference stock underwritten by Morgan Stanley and Co Inc and FIrst Boston Corp. USX said the proceeds will be used to redeem its currently outstanding 2.25 dlrs convertible exchangeable cumulative preference stock. USX said the new stock will be offered at 50 dlrs a share and will have a dividend of 3.50 dlrs a share per year. Reuter | USX <X> OFFERS CONVERTIBLE PREFERRED |
Moodys Investors Service Inc said it affirmed the ratings on 1.4 billion dlrs of debt of Marine Midland Banks Inc and unit Marine Midland Bank NA. Affirmed were the parents A-2 senior debt and preferred stock and A-3 subordinated debt and the units Prime-1 commercial paper A-1 long-term deposits A-2 subordinated debt and Prime-1 short-term deposits. Moodys cited a 400 mln dlr addition to the firms loan loss reserves as a reflection of exposure to economically troubled borrowers. Moodys said the addition merely more accurately reflects economic reality. Reuter | MARINE MIDLAND <MM> DEBT AFFIRMED BY MOODY'S |
National Westminster Bank Plc <NWBL.L> announced a 0.75 pct reduction in the mortgage interest rate applicable to new mortgages taken out from June 19 1987. The new rate is 10.5 pct (APR - Annual Percentage Rate - 11.2 pct including fees for normal repayment mortgages and 11.1 pct including fees for endowment and pension mortgages). A spokesman for Nat West said the position for existing mortgages is being kept under active review in the light of market conditions and an announcement will be made as soon as possible. REUTER | NAT WEST CUTS MORTGAGE RATE FOR NEW BORROWERS |
TPI Enterprises Inc said chairman and chief executive officer Stephen R. Cohen may be one of the partners in a partnership formed by AMC Entertainment Inc <AEN> and Phillip E. Cohen to own 6275144 TPI shares. Yesterday AMC announced that it and Cohen had agreed to buy the shares from Rank America Inc for six dlrs each. Cohen was formerly a TPI director. TPI said under the terms of its sale of the shares to Rank it has a 30-day option to purchase the shares Rank proposes to sell to AMC and Cohen for the same price. It said its board will consider whether or not to exercise the option. Reuter | TPI ENTERPRISES <TELE.O> CHAIRMAN IN STOCK BUY |
Congressional Democratic leaders announced a compromise has been reached on a 1988 budget paving the way for final approval of a trillion dollar spending plan. House Speaker Jim Wright and Senate Majority Leader Robert Byrd told a news conference that final congressional approval of the plan to reduce an estimated 171 billion dlr deficit next year to 134 billion dlr was expected next week. The plan was worked out by Democrats who control both House and Senate but who have been stalemated for a month over different House and Senate budgets that passed earlier. The budget proposes 19.5 billion dlrs in new taxes next year 65 billion dlrs over a three year span. It would cut President Reagans request to spend 298 billion dlrs for defense in 1988 by about nine billion dlrs but only if he accepts the proposed tax increase to pay for it. If Reagan rejects the tax rise which he has said he would defense spending under the plan would drop automatically by about five billion dlrs the leaders said. Reagans own budget was rejected by wide margins in both House and Senate by a combination of Democrats and his own Republican party who said it was unrealistic. Reuter | U.S. BUDGET COMPROMISE REACHED IN CONGRESS |
Senator Kent Conrad D-ND said President Reagans goal of phasing-out world farm subsidies by the year 2000 is doomed to failure because the European Community EC will not accept it. It (Reagan plan) is a nonstarter. Its absolutely crystal clear they (EC) have no intention of eliminating subsidies said Conrad on his return from a four-day visit to Europe. Instead of proposing an end to farm subsidies he said the U.S. should adopt some of the EC Common Agricultural Policy CAP principles by seeking a compromise agreement with Brussels to jointly reduce production and apply a two-price system of high domestic and low export prices. Under the plan export subsidies would bridge domestic and world price gaps said Conrad a new member of the Senate Agriculture Committee. Reuter | SENATOR SAYS REAGAN FARM REFORM PLANS DOOMED |
A minority group of European Community countries strong enough to block the adoption of a tax on vegetable and marine oils and fats is still intact after the EC Commission proposed changes to its proposals earlier today British agriculture minister John MacGregor told journalists. He said Britain West Germany the Netherlands and Denmark continue to oppose the tax after the Commission proposed making it temporary and promising compensation to any third countries whose exports suffered. Reuter | RPT - OPPOSITION TO EC OILS TAX INTACT - MINISTER |
Harcourt Brace Jovanovich Inc said it has called a special meeting for July 23 for a vote on an increase in authorized common shares to 100 mln from 50 mln an increase in preferred shares to 150 mln from 2500000 and a provision allowing the payment of preferred dividends in stock or property as well as cash. The company said June 29 will be the record date for the meeting. Harcourt which is fighting off a takeover bid from <British Printing and Communication Corp PLC> has declared a special dividend on common stock of 40 dlrs in cash and 12 pct preferred stock with a market value of 10 dlrs per share. The special dividend is to be paid July 27. Reuter | HARCOURT BRACE <HBJ> CALLS SPECIAL MEETING |
Washington Bancorp said it has added 12 mln dlrs to its reserves for losses on international loans causing a second quarter loss of about nine mln dlrs. The company said it expects a profit for the calendar year that will be more than sufficient to cover dividend payments and the current dividend policy will be maintained. The company now pays seven cts per share quarterly. Washington Bancorp earned 2358000 dlrs for last years second quarter and 8179000 dlrs for all of 1986. It said despite the increased provision book value at year-end should be at least as much as the end-1986 17 dlrs per share. Reuter | WASHINGTON BANCORP <WWBC.O> ADDS TO RESERVES |
Shr 1.08 dlrs vs 37 cts Net 3025000 vs 1188000 Sales 35.2 mln vs 35.4 mln Avg shrs 2794298 vs 3187051 Nine mths Shr 2.43 dlrs vs 83 cts Net 6781000 vs 2576000 Sales 101.0 mln vs 99.7 mln Avg shrs 2794298 vs 3115499 Reuter | PENWEST INC <PENW.O> 3RD QTR MAY 31 NET |
The European Investment Bank said it is making a 300 mln franc loan to Peugeot SA <PEUP.PA> to restructure the paint works at its Sochaux car factory in France. It said the ten-year loan carries interest at 9.15 pct and follows a 300 mln franc 8.60 pct ten-year loan the bank made to Peugeot last July. Work on the paint shop at Sochaux is part of a 1.3 billion franc operation to modernise the groups factories it added. REUTER | EIB MAKES 300 MLN FRANC LOAN TO PEUGEOT |
European coffee traders and roasters may propose a new formula for calculating International Coffee Organization (ICO) coffee quotas at the end of their meeting here this week traders and officials told Reuters. Although traders were unwilling to reveal details of the possible new formula they said it would give Brazil the worlds biggest coffee producer unchanged ICO quotas for the next two years and could be a basis for renegotiation. The main sticking point on quotas has been Brazils attitude and this compromise could be a solution one said. However the European coffee trade federation meeting which began here today and is to continue to the end of the week has revealed gaps in the European position on re-introducing quotas. Traders said that as a whole the trade side was against re-introduction of ICO quotas while roasters were generally in favour with the single proviso that there had to be some formula basis for re-allocating quota shares among producing countries. The roasters said the positions were generally fairly close and problems with some Government officials. Germany and Italy were cited as the extremes of polarized Government attitudes with most other countries on the fence. Sources said Germany was the most extreme against quota re-introduction while the Italians were most in favour. Nevertheless we expect to find enough common ground by the end of the week to at least present a common European Community (EC) view at the next meeting of consumer members of the International Coffee Agreement (ICA) in July one trader said. We hope we can present the compromise proposal and that not only the consumer side but the producer side will accept it one official said. We have learned that we can live without the quotas that were suspended in February last year but would prefer the stability they can bring to the market as long as we do not simply return to the old and outdated status quo as far as quota allocation is concerned he added. Overall however trader and roaster opinion on the likelihood of a successful re-negotiation was mildly pessimistic varying between a 50-50 chance and 60-40 against. Our main difficulty will be to persuade the U.S. On the consumer side and Brazil on the producer side to agree to quota re-introduction he said. The U.S. Position has if anything hardened while the new Brazilian Coffee Institute president has adopted the least negotiable position of any of his predecessors one trader said. However with many producers starting to swing in favour of the consumer position that quotas have to be re-allocated under a new formula Brazil is becoming increasingly isolated which gives at least some hope of a compromise at the ICO quota meeting in September the official said. Reuter | RPT - EUROPEAN TRADE MAY PROPOSE NEW ICO FORMULA |
First Data Management co Inc said it has completed a merger into Firsst Data MAnagement Holding co following sharehoplder approval. It said each 100 shares will be exchanged for 1000 dlrs principal amount of 14.375 pct senior subordinated debentures due June 15 2002. Reuter | FIRST DATA MANAGEMENT <FDMC.O> COMPLETES MERGER |
Qtr ends April 30 Shr loss 10 cts vs profit nine cts Net loss 163465 vs profit 131815 Revs 3672731 vs 3763829 Nine mths Shr profit four cts vs profit one ct Net profit 57911 vs profit 11380 Revs 11753950 vs 10794822 Reuter | FROST AND SULLIVAN INC <FRSL.O> 3RD QTR |
Frost and Sullivan Inc President Daniel Sullivan said he and other executive officers of the company have agreed to sell an aggregate of 542684 shares of common stock including shares issuable on exercise of options. In addition Sullivan said he and other officers would also cause to be sold an additional 44000 shares to Theodore Cross an investor for 10 dlrs per share. Frost and Sullivan publishes market research reports and sponsors management seminars and conferences. Such shares together with the shares presently held by Cross will give Cross a majority of the outstanding shares of the companys common stock Sullivan said. Sullivan will continue as president and chief executive officer the company said. After consummation of the sale Cross and his designees will be elected to the board and constitute a majority the company said. The company also said stockholders would get 10 dlrs per share. The board of directors is expected at its next meeting torecommend that the stockholders accept. Reuter | FROST/SULLIVAN <FRSL.O> OFFICERS TO SELL SHARES |
Poughkeepsie Savings Bank said its board declared an initial quarterly dividend of 10 cts per share payable July 31 to holders of record July 17. Reuter | POUGHKEEPSIE SAVINGS <PKPS.O> SETS FIRST PAYOUT |
Indonesia rejected World Bank recommendations for sweeping reforms to its farm economy as the countrys foreign aid donors met to consider giving it 2.5 billion dlrs in grants and soft loans. Agriculture Minister Achmad Affandi in written remarks distributed today as Indonesias 14 foreign donor nations met at The Hague said The general argument presented by the Bank for this free trade open economy view is weak. The Bank called for overhauls in how Indonesia manages the largest farm area in South-east Asia and said agricultural growth was stagnating under subsisides for rice farming. The Bank report said Indonesias rice production had peaked and the subsidies are a waste of money. Affandi replied that rice is the main staple and provides an income for 17 pct of the workforce. The subsidies were needed to support the fertilizer industry including importers exporters producers and distributors he said as well as assisting in small part the majority of Indonesian farmers. Affandi agreed with a bank recommendation that farmers should be free to choose their own crops but he said the government would continue to maintain production targets for strategic commodities such as rice and sugar. The Bank report was especially critical of Indonesias drive to plant sugar saying domestic sugar prices are double the world average because of inefficiencies and the country would save money by importing the commodity. However Affandi said volatile world sugar prices the need to save foreign exchange and an already up-and-running sugar industry were good arguments for continuing the sugar drive. He also said import barriers and trade monopolies in the agricultural sector were needed to help domestic industry develop and because of over-production and price intervention in the developed nations. REUTER | INDONESIA REJECTS WORLD BANK FARM REFORM PROPOSALS |
Shr 29 cts vs 23 cts Net 1262000 vs 1002000 Sales 49.9 mln vs 40.3 mln Year Shr 1.18 dlrs vs one dlr Net 5205000 vs 4339000 Sales 180.1 mln vs 150.7 mln NOTE: Prior year net both periods includes gain 900000 dlrs from adjustments to LIFO reserves compensation related accruals and a revised effective tax rate. Reuter | CULP INC <CULP.O> 4TH QTR MAY TWO NET |
Chock Full O Nuts Corp said its board declared a three pct stock dividend payable July 31 to holders of record July Eight. The company also said Page M. Black has resigned from its board to devote her attention to charitable affairs. Reuter | CHOCK FULL O' NUTS <CHF> SETS STOCK DIVIDEND |
Qtly div seven cts vs seven cts prior Pay Aug 17 Record July 31 Reuter | WOODSTREAM CORP <WOD> SETS QUARTERLY |
Qtly div eight cts vs eight cts prior Pay Aug 28 Record Aug Three Reuter | BUELL INDUSTRIES INC <BUE> SETS QUARTERLY |
U.S. House and Senate budget negotiators agreed as part of an overall budget accord reached yesterday to cut 1.25 billion dlrs from fiscal 1988 spending on agricultural programs Congressional sources told Reuters. The agreed cut in farm programs is a compromise between 1.4 billion sought by the Senate and one billion by the House. The negotiators also agreed to cut 1.6 billion from the farm budget in fiscal 1989 and 2.45 billion in 1990 for a total of 5.3 billion in saving over three years sources said. The agreement presents the House and Senate Agriculture committees with difficult choices on how to make changes in agriculture programs that achieve the budget savings targets without jeopardizing popular support payments senior Congressional aides told Reuters. Some farm state lawmakers already are manuevering to find the budget savings. Rep. Dan Glickman D-Kan. Chairman of the House grains subcommittee has introduced a bill which would freeze wheat and corn loan rates for the 1988 crop at the current 2.28 dlrs and 1.92 dlrs respectively saying it would save 500 mln dlrs. House Agriculture Committee chairman Kika De la Garza has said the committee will consider the Glickman proposal. But Congressional sources said the proposal is unlikely to be approved because of opposition from Republican lawmakers and a strong stance by Agriculture Secretary Richard Lyng who said freezing loan rates would send the wrong signal to other major grain export competitors and would not achieve the budget savings Glickman claims. Another area where Glickman and other have said budget savings might be made is to increase acreage reduction program ARP levels for wheat and corn. However on this issue also Lyng has taken a strong stand within the Reagan administration arguing that the 1988 crop wheat acreage reduction should be left at 27.5 pct and not 30 pct as sought by the Office of Management and Budget OMB. Most commodity lobbyists expect Lyng to prevail. Congressional sources said the only way to achieve significant budget cuts through ARP increases would be to boost the 1988 corn ARP. But one informed Congressional source said singling-out corn for an ARP increase would would be seen as unfair to one commodity. Congressional sources said the areas where Congress is most likely to eventually look for budget savings are some tightening of the payment limitation rules and possible adoption of a 0/92 program for the 1988 crops of major grains. Those changes would achieve a portion of the 1.25 billion but not enough they said. Ultimately Congressional sources said the agriculture committees may be forced to apply an across-the-board cut on all Commodity Credit Corp. payments to farmers including price support loans and deficiency payments similar to the Gramm-Rudman-Hollings budget cut applied in fiscal 1986. This idea has been suggested by the American Farm Bureau Federation AFBF as the fairest approach for all commodities. Reuter | BUDGET PACT CUTS U.S. FARM FUNDS 1.25 BILLION DLRS |
Woodstream Corp said its board will hold a special meeting on July 28 to review a strategic plan developed by management. It gave no details. Reuter | WOODSTREAM <WOD> REVIEWING STRATEGIC PLAN |
New applications for unemployment insurance benefits rose to a seasonally adjusted 340000 in the week ended June 6 from 310000 in the prior week the Labor Department said. The number of people actually receiving benefits under regular state programs totaled 2359000 in the week ended May 30 the latest period for which that figure was available. That was up from 2255000 the previous week. Reuter | U.S. FIRST TIME JOBLESS CLAIMS ROSE IN WEEK |
Qtly div 1.25 dlrs vs 1.25 dlrs prior Pay Aug One Record June 30 NOTE: American Information Technologies Corp. Reuter | AMERICAN INFORMATION TECHNOLOGIES <AIT> PAYOUT |
Qtly div 25 cts vs 25 cts prior Pay July 10 Record June 30 Reuter | INTELLIGENT SYSTEMS MASTER LP <INP> IN PAYOUT |
Qtly div 96 cts vs 96 cts prior Pay August one Record June 30 Reuter | BELL ATLANTIC CORP <BEL> SETS QTLY DIVIDEND |
The Arab Monetary Fund is to lend Iraq 71.7 mln dlrs to help to finance its trade with other Arab countries the United Arab Emirates news agency WAM said. The first repayment on the loan will fall due in 30 months with full repayment spread over four years. The loan carries 4.95 pct interest in the first year rising to 5.85 pct in the fourth year. Todays agreement brings total loans by the fund to Iraq since 1983 to 390.6 mln dlrs. REUTER | ARAB MONETARY FUND LENDS IRAQ 71.7 MLN DLRS |
Some OPEC states are unhappy about the prices assigned to their crude oil but this should not pose great problems when the group reviews its six-month-old price and output pact in Vienna next week oil analysts say. They said Nigeria which holds the OPEC conference presidency and Qatar probably have the biggest grievances about price differentials making some of their crudes uncompetitive. There has also been speculation by Japanese traders that OPEC might want to mark up prices of high-sulphur heavy crudes to correspond with greater demand and higher fuel oil prices. But most experts agree that a major overhaul of price differentials is unlikely so as to avoid giving the market signals of a dent in OPECs new unity. All OPEC members can make a good case for changing differentials said one analyst with a major oil company. But at the end of the day the attitude is going to be leave well alone and little or nothing is likely to be altered. Iran Libya and Saudi Arabia are among those who also saw sales problems earlier this year traders say. But diminished customer resistance to fixed prices and in some cases marketing incentives have helped their sales. Some producers can sell uncompetitively priced crudes by means of discounts processing deals or selling them alongside better priced grades in a package. Many OPEC crudes are seen to be reasonably priced at least for some part of the year. But many experts say OPEC should change prices quarterly or monthly to match seasonal demand for fuel oil-rich heavy crudes and gasoline-rich lighter grades. At its last meeting in December OPEC agreed to reintroduce fixed prices from February 1 around an 18 dlr per barrel reference point. Official prices had been effectively dropped in 1985 when members offered discounts to attract customers. OPEC also decided to limit first-half 1987 output to 15.8 mln bpd and proposed ceilings of 16.6 mln for the third quarter and 18.3 mln for the fourth. Analysts expect it will now extend or raise slightly the current ceiling for the coming months. Spot market and netback values for some crudes do not mirror official prices but OPEC will probably keep the 18 dlr target and at most make minimal changes to differentials analysts say. The 18 dlr figure is based on a basket of six OPEC and one non-OPEC crudes. OPEC assigned prices to its other key export crudes with a 2.65 dlr gap between the heaviest and lightest. Extra heavy crudes were among those left out. Industry estimates vary on the proportion of OPEC oil exports actually sold at official prices. Several experts say only one-quarter to one-third of the total in fact sells at official prices with some of the rest included in processing or barter deals or sold in the form of refined products. Problems with the new structure appeared earlier this year when some producers output fell due to customer reluctance to pay the new prices. Nigeria especially found its gasoline-rich Bonny Light crude -- now OPECs highest priced grade at 18.92 dlrs a barrel -- was uncompetitive on the spot market against Britains Brent. In February and March Nigerias production shrank below its 1.238 mln bpd OPEC quota. Spot prices have since revived due partly to seasonal demand for gasoline and its output has risen. Some experts feel Bonny Light is still overvalued and say its price should be cut by between 50 cts to one dlr a barrel. But Mehdi Varzi chief oil analyst with Londons Kleinwort Grieveson Securities doubts Nigeria will actively push the differentials question in Vienna. It would not look good for OPEC unity if Nigeria which holds the presidency raised the issue he said. REUTER | OPEC DIFFERENTIALS NOT SEEN POSING MAJOR PROBLEMS |
Qtly div 10 cts vs 10 cts prior Pay July 30 Record July 15 Reuter | RYLAND GROUP INC <RYL> IN PAYOUT |
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