- Clear Channel deal puts banks on defensive
- Volcker Says Fed Interventions Risk Political Battles
- Barclays writes down a further £1bn
- Mizuho Predicts Profit Recovery After Subprime Losses
- GE could sell appliances unit
- Toyota Prius sales hit 1 million worldwide
- Fast-Rising Steel Prices Set Back Big Projects
- Consumers ditching land-line phones
- Edwards Backs Obama as Clinton Continues Fight
Clear Channel deal puts banks on defensive - Financial Times
Banks will be less willing to finance leveraged buy-outs as a consequence of a revised deal struck by Bain Capital and Thomas H Lee to buy Clear Channel Communications, bankers and private equity executives said on Wednesday.
Under the new terms, Clear Channel will be bought by its managers and the two private equity firms for $36 a share, or $17.9bn – an 8 per cent discount to the previously agreed price.The deal came after the private equity firms and Clear Channel, which owns radio stations and outdoor advertising sites, went to court in New York and Texas to press the banks to make good on their commitment to finance the deal.
The amended agreement, revealed late on Tuesday, represents a victory for private equity buyers and a disappointment for shareholders. But its most important consequence could be its effect on the willingness of banks to back future deals, according to bankers and private equity executives at other firms.....
Volcker Says Fed Interventions Risk Political Battles - Bloomberg
Former Federal Reserve Chairman Paul Volcker warned that Ben S. Bernanke's interventions in securities markets opened the door to political interference that may threaten the Fed's independence in setting interest rates.
``Intervention in a broad range of credit-market instruments may imply official support for a particular sector of the market or the economy,'' Volcker said in testimony to the congressional Joint Economic Committee in Washington today. Support for specific markets ``throws them into political battles,'' he said in an interview, referring to the Fed.
Volcker's comments are his most detailed warning yet about the consequences of the Fed's rescue of Bear Stearns Cos. and taking on mortgage securities from bond dealers. He joins former Fed chief Alan Greenspan in anticipating greater meddling with the central bank at a time of rising inflation pressures.
``Independence is integral to the central responsibility of the Federal Reserve'' for ``the conduct of monetary policy,'' said Volcker, 80, who served as Fed chairman from 1979 to 1987, and is credited with halting runaway inflation. He was succeeded by Greenspan, who retired in January 2006....
Barclays writes down a further £1bn - The Times of London
Barclays issued a generally upbeat trading statement for the first quarter today but has explicitly refused to rule out a rights issue to boost its capital ratios.
Barclays said profits for the first quarter had come in below the same time last year. While profits before tax in January and February were broadly in line with 2007, tougher capital conditions meant March was below the very strong figure for the same month the previous year.
The bank reported £1billion of net losses from "credit market turbulence" even after a £700 million gain on the valuation of notes issued by the investment banking arm, Barclays Capital. But Barclays said this business was profitable despite "difficult trading conditions".....
Mizuho Predicts Profit Recovery After Subprime Losses - Bloomberg
Mizuho Financial Group Inc., Japan's second-largest bank by revenue, forecast profit will recover this year and said it will buy back shares after $6.2 billion of losses on subprime mortgage investments.
Profit in the year to March 2009 may rise 80 percent to 560 billion yen ($5.3 billion), Mizuho said in a statement to the Tokyo Stock Exchange today. That compares with the 615 billion yen median estimate in a survey of 12 analysts by Bloomberg News.
Mizuho cut profit estimates three times in the past year on increased losses stemming from the U.S. housing-market collapse. Stagnant lending in a slowing Japanese economy has prompted Mizuho and local rivals such as Mitsubishi UFJ Financial Group Inc. to expand in other Asian markets....
GE could sell appliances unit - Financial Tmes
General Electric is considering putting its appliances unit up for sale in a move that could raise some $7bn and sever its century-long links with one of its oldest businesses.
People close to the situation said the US conglomerate had held talks with investment banks with a view to hire one of them to solicit bids for the business, which had sales of $7.2bn last year.However, people familiar with the situation said no final decision on whether to sell the appliances business, which has been part of GE since the early 1900s, had been made.
The decision to consider a sale of the appliances unit, whose products range from toasters to ovens and fridges, underlines the desire by Jeffrey Immelt, chairman and chief executive, to boost earnings by investing in high-margin businesses.....
Toyota Prius sales hit 1 million worldwide - Reuters
Toyota said on Thursday that cumulative sales of its Prius hybrid car had topped 1 million units worldwide since its launch just over a decade ago.
The Prius, the world's first mass-produced gasoline-electric hybrid car, first went on sale in Japan in late 1997 and in other markets in 2000. Toyota remains the leader in hybrid sales, with Honda a distant second with its Civic model.
Toyota, the world's biggest automaker, said it had sold about 1,028,000 Prius cars as of the end of April.
"Toyota believes that Prius vehicles worldwide have contributed to a reduction in carbon dioxide emissions by producing approximately 4.5 million tonnes less CO2 when compared with gasoline-powered vehicles in the same class and of similar size and driving performance," it said in a statement....
Fast-Rising Steel Prices Set Back Big Projects - Wall Street Journal
Relentless increases in the price of steel are halting or slowing major construction projects world-wide and investments in shipbuilding and oil-and-gas exploration, setting the stage for a potential backlash against steelmakers.
In Turkey, a construction association said this week it will begin a 15-day strike in eight cities Thursday to press steelmakers to cut their prices, which have more than doubled locally since late last year.In New Delhi, India, an ambitious bridge project has been put on hold because of steel-related cost overruns, and contractors are postponing or reining in construction of much-needed housing for the poor, prompting the Indian government to freeze steel prices for the next three months.
Venezuela, aiming to control prices, renationalized its largest steelmaker and is limiting exports. Oil executives in the U.S., meanwhile, say costly steel is threatening their energy exploration efforts.....
Consumers ditching land-line phones - USA Today
Traditional land-line phones, once the bedrock of communications in the USA, are quickly going the way of eight-track tapes as consumers go wireless or choose Internet-based phone calling.
According to a report due to be released Wednesday by the National Center for Health Statistics, nearly one out of every six homes in the USA — 15.8% — had only wireless telephones during the second half of 2007, up from 6.1% during the same period in 2004.
"America has a lot of gabbers," says Sameer Mithal, a senior principal with IBB Consulting in Princeton, N.J. "The ability to talk on the go is what Americans like to do."....
Edwards Backs Obama as Clinton Continues Fight - Wall Street Journal
Barack Obama picked up the support of John Edwards Wednesday as the Democratic Party establishment rallied behind the front-runner, striking a blow to Hillary Clinton, who vowed to continue her bid for the Democratic presidential nomination.
Mr. Edwards, the former North Carolina senator, joined Sen. Obama at a rally at the Van Andel Arena here where he announced his endorsement, marking roughly the sixth Democratic superdelegate to pledge support for Sen. Obama since Sen. Clinton's big victory Tuesday in the West Virginia primary.
"There is one man who knows in his heart it is time to create one America, not two, and that man is Barack Obama," Mr. Edwards said to a screaming crowd.....
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