AP Business Highlights

Bankruptcy judge OKs GM sale plan, appeal looms

 

NEW YORK (AP) -- A bankruptcy judge has ruled that General Motors Corp. can sell the bulk of its assets to a new company, potentially clearing the way for the automaker to quickly emerge from bankruptcy protection.

U.S. Judge Robert Gerber said in his 95-page ruling late Sunday that the sale was in the best interests of both GM and its creditors, whom he said would otherwise get nothing.

An appeal is expected. A Chicago law firm representing people who have sued GM in several auto accident cases filed paperwork Monday saying it would appeal to U.S. District Court in New York. The deadline to appeal is noon Thursday, after which point Gerber's order takes effect and the sale is free to close.

Stocks end mixed; Oil slide hits energy shares

NEW YORK (AP) -- Stocks ended mostly lower Monday as drops in prices for oil and other commodities spurred worries that demand for basic materials may remain slack. Indexes ended mixed but off of their lows for the day.

Investors have become more cautious in recent weeks following a strong rally that began in March. Some traders fear they might have been too optimistic about how soon the economy might recover from a recession that began in December 2007.

The Dow Jones industrial average rose 44.13, or 0.5 percent, to 8,324.87.

Service sector shrinks less than expected in June

NEW YORK (AP) -- The U.S. services economy -- from retailers and restaurants to real estate brokers -- contracted less than expected in June in its best showing since before the financial crisis struck last fall, according to a private trade group's gauge.

The Institute for Supply Management on Monday said that its services index rose to 47 in June from 44 in May. Economists polled by Thomson Reuters had expected a June reading of 45.5.

Any reading below 50 indicates the services sector is shrinking, and June marked the ninth straight month of contraction. Still, it was the best showing since September when the index was at 50.

Crude tumbles on doubts about economic rebound

NEW YORK (AP) -- Oil prices tumbled to a five-week low Monday on growing evidence of an extended recession that could sap energy demand for some time.

Benchmark crude for August delivery fell $2.68 to settle at $64.05 a barrel on the New York Mercantile Exchange.

It was the fourth straight day of declines on Nymex and since hitting a midday high for the year last Tuesday. Crude prices have fallen nearly 13 percent since then.

Natural gas prices plunged as well. Major natural gas users, like industrial manufacturers, have been hit hard by the recession and unemployment data released last week in both the U.S. and Europe doused hopes for a quick recovery.

Bemis paying $1.2B for Alcan Packaging assets

NEW YORK (AP) -- Bemis Co., whose clear plastic packages hold everything from batteries to burgers, said late Sunday it is paying $1.2 billion for the global packaging business of Rio Tinto PLC.

Buying the assets, known collectively as Alcan Packaging Food Americas, gives Bemis 23 facilities in the U.S., Canada, Mexico, Brazil, Argentina and New Zealand, that make flexible plastic containers for cheeses and steaks as well as clear, hard-to-penetrate packages for batteries and toys.

The acquisition extends the market share of Neenah, Wis.-based Bemis over one of its main rivals, Sealed Air Corp., which earlier had looked at acquiring the Alcan assets, KeyBanc analyst Christopher D. Manuel said in a phone call.

EMC hikes offer for Data Domain, bidding escalates

NEW YORK (AP) -- Firing the latest salvo in a bidding brawl, data storage company EMC Corp. boosted its offer for Data Domain which has already accepted a lower bid from NetApp Inc.

EMC's new offer of $33.50 a share in cash, announced Monday, is $3.50 per share above its previous offer and values Data Domain Inc. at $2.1 billion.

Santa Clara, California-based Data Domain has already accepted a sweetened bid of $30 a share in cash and stock from NetApp, which said Monday its board would examine in options.

PepsiCo, Pepsi Bottling invest $1B more in Russia

MILWAUKEE (AP) -- Soft drink and snack maker PepsiCo Inc. announced plans Monday to boost its investment in Russia, continuing a trend of consumer companies seeking growth in emerging markets as their U.S. sales soften.

With its largest bottler, Pepsi Bottling Group Inc., PepsiCo plans to invest another $1 billion in Russia over three years, taking the partnership's Russia stake above $4 billion just as President Barack Obama opens his first official visit to Moscow.

PepsiCo, the Purchase, New York-based maker of Pepsi, Gatorade and Tropicana drinks and Frito-Lay snacks, and Pepsi Bottling plan to boost their manufacturing and distribution capacity in Russia.

US, Britain join Austria in Madoff-related probes

VIENNA (AP) -- U.S. and British investigators have joined Austrian prosecutors in examining possible ties between a Vienna fund manager and disgraced financier Bernard Madoff, whose multibillion-dollar Ponzi scheme wiped out thousands of investors and charities worldwide, an official said Monday.

Gerhard Jarosch, spokesman for the Vienna public prosecutor's office, told The Associated Press his office is aiding the U.S. Justice Department and Britain's Serious Fraud Office in separate investigations of Bank Medici AG and its chairwoman, Sonja Kohn.

Honduras coup costs oil, aid as economy stalls

TEGUCIGALPA, Honduras (AP) -- The economy of Honduras, never strong, could be deeply damaged by multinational efforts to isolate and pressure the interim government into returning President Manuel Zelaya to power.

International aid and loans are drying up, the threat of trade sanctions looms and Hugo Chavez cut off supplies of Venezuelan oil to Honduras shortly after his ally Zelaya was ousted in a pre-dawn military raid.

The poor are sure to be hit hardest by the economic isolation. About half of Hondurans live in poverty, and most are vulnerable to a surge in gasoline prices likely to follow the suspension of oil shipments to the cash and fuel-strapped country.

Singer's luxe lifestyle aided by Wall Street firms

NEW YORK (AP) -- Music lovers weren't the only ones drawn to the King of Pop. Wooed by his global fame and earning power, a bevy of financial firms ponied up tens of millions to finance the singer's luxe lifestyle and kick-start his troubled career.

Now they're in line with other creditors and business partners awaiting word on the state of Michael Jackson's murky financial empire. Financial firms including Colony Capital LLC, Fortress Investment Group and Barclays Bank PLC poured tens of millions into the singer over the years. The cash allowed Jackson, a notorious binge spender, to maintain a lavish lifestyle befitting a global pop star.

By The Associated Press

The Dow Jones industrial average rose 44.13, or 0.5 percent, to 8,324.87.

The broader Standard & Poor's 500 index rose 2.30, or 0.3 percent, to 898.72. The technology-heavy Nasdaq composite index fell 9.12, or 0.5 percent, to 1,787.40.

Benchmark crude for August delivery fell $2.68 to settle at $64.05 a barrel on the New York Mercantile Exchange.

Gasoline prices fell again overnight to a new national average of $2.611 a gallon, according to the Oil Price Information Service and AAA.

In other Nymex trading, gasoline for August delivery fell 5 cents to settle at $1.7404 a gallon and heating oil slid 7.5 cents to settle at $1.6266. Natural gas for August delivery shed 12.8 cents to settle at $3.487 per 1,000 cubic feet.

In London, Brent prices dropped $1.56 to settle at $64.05 a barrel on the ICE Futures exchange.

 

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