Washington, D.C. - President Bush said Friday that the government will assist the struggling automakers, General Motors Corp. (NYSE: GM) and Chrysler LLC, to restructure their businesses and to stave off bankruptcy while they develop plans for viability.

"The financial crisis brought the auto companies to the brink of bankruptcy much faster than they could have anticipated," Bush said in a statement on Friday.

He continued, "They have not made the legal and financial preparations necessary to carry out an orderly bankruptcy proceeding that could lead to a successful restructuring."

The two of the three big automakers will receive a total of $17.4 billion in loan, including $13.4 billion in emergency loans and a $4 billion fund to be alloted in February.

Under the first allocation, GM will receive $9.4 billion from the federal loan money, while Chrysler would get the other $4 billion. Ford does not require any government funding for now.

The funds will be available from the $700 billion Troubled Asset Relief Program, which was initially established to support the distressed financial companies suffered by the financial crisis.

The companies will have to come up with a viable restructuring plan by March 31st. If they fail, they it will be required to repay its federal loans.

The troubled auto industry gets a nod from the House of Representatives to receive $14 billion in bailout, but it not pass through the Senate as the Republicans opposed terming it as a 'weak' auto bill.

General Motors, Ford Motor, and Chrysler LLC have been discussing with their lenders, auto-part suppliers and the United Auto Workers union members to gain more time and concessions to dampen their losses.

Under the term, the automakers have to meet conditions that are necessary for long-term viability, Bush said today.

The automakers would require to put their retirement plans on a sustainable footing, persuade bondholders to convert their debt into capital the companies need to address immediate financial shortfalls, and make their compensation competitive with foreign automakers who have major operations in the U.S.

Ford has decided to avoid accepting funds from the latest bill as it has some cash in reserve to help the company survive over the next few months. The automaker has indicated in the past that it may ask for a $9-billion credit line.

GM's cash, and other assets amounted to $16.2 billion on September 30, 2008, down from $21.0 billion it had reported as of June 30, 2008, reflecting negative adjusted operating cash flow of $6.9 billion in the third quarter 2008.

"This action helps to preserve many jobs, and supports the continued operation of GM and the many suppliers, dealers and small businesses across the country that depend on us," GM said in a statement, commenting on the Bush administration's step to extend the financial bridge to the company.

GM was trading higher by 42 cents or 11.48 percent to $4.08 and Ford was moving higher by $0.03 or 1.06 percent to $2.87 in afternoon trading on the New York Stock Exchange on Friday.

Washington, D.C. - The Securities and Exchange Commission has finalized settlements with Citigroup Global Markets, Inc. (Citi) and UBS Securities LLC and UBS Financial Services, Inc. (UBS), who misled investors regarding the liquidity risks associated with auction-rate securities (ARS) that they underwrote, marketed and sold.

The Securities and Exchange Commission (SEC) said two companies will provide nearly $30 billion to tens of thousands of customers who invested in auction rate securities before the market for those securities froze in February.

The settlements, which are subject to court approval, will restore approximately $7 billion in liquidity to Citi customers who invested in ARS, and $22.7 billion to UBS customers who invested in ARS.

“Today’s settlements are the largest in SEC history, and represent the largest return of customer money in the agency’s 75 years,” said SEC Chairman Christopher Cox.

“The Commission’s prompt action after the auction rate securities market froze in February of this year, which led to last summer’s settlements in principle, helped restore liquidity to tens of thousands of investors."

Cox added that every one of the investors -- including charities and small to mid-sized businesses-- covered by these settlements will be able to receive 100 cents on the U.S. dollar on their auction rate securities investments.

Auction-rate securities (ARS) are preferred shares or bonds with interest rates that reset on a regular period, some times it is reset every week, in auctions managed by the brokerage firms similar to Citigroup that originally sold them.

The SEC said that the companies misrepresented to customers that ARS were safe, highly liquid investments that were comparable to money markets.

But in late 2007 and early 2008, the companies knew that the ARS market was deteriorating, leading the firms to have to purchase additional inventory to prevent failed auctions, and that their ability to support auctions by purchasing more ARS had been reduced, as the credit crisis stressed the firms' balance sheets.

According to the complaints, Citi and UBS failed to make their customers aware of these risks. In mid-February 2008, the firms decided to stop supporting the ARS market, leaving tens of thousands of Citi and UBS customers holding tens of billions of dollars in illiquid ARS.

"The SEC will continue to aggressively investigate whether other broker-dealers and individuals have failed to disclose to investors material risks about ARS that they marketed and sold," Linda Chatman Thomsen, director of the SEC's Division of Enforcement, said in the statement.

Thomsen said the SEC has yet to finalize settlement with four other companies including Bank of America Corp., Royal Bank of Canada, Merrill Lynch & Co. and Wachovia Corp., who are expected to buyback a total of $25 billion of auction-rate securities.

Click Here For The SEC Statement.

New York, NY - Nearly 29,000 jobs cut were announced across the globe on Thursday as weak credit market conditions and on-going recession in major economies are hurting the profit margins on several companies across all sectors.

AT&T Inc. (NYSE: T) led the bad news as the U.S. entered the holiday season by decided to slash as many as 12,000 employees or 4 percent of the company's total workforce, citing economic pressures, a changing business mix and a more streamlined organizational structure.

The Dallas, TX-based company said that due to the current crisis and economic factors, AT&T is expected to reduce its 2009 capital expenditures from 2008 levels. The details on expenditure cuts will be disclosed when the company releases its fourth quarter results in late January.

The company also reported with the reductions in workforce, which will occur in December and throughout 2009, AT&T will take a charge of almost $600 million in the fourth quarter of 2008 to pay severance to affected employees.

Chemical company DuPont Co. reported that it is expected to slash as many as 6,500 workers, including 4,000 contractors by year-end 2008 with additional contractor reductions in 2009, as a part of its restructuring plan, increasing cash flow and reducing expenses.

With the elimination of 2,500 full-time employees, the company will take a pre-tax charge of around $500 million, or $.40 per share, in the fourth quarter 2008. These actions are expected to generate a pre-tax earnings rise of about $130 million for 2009 and about a $250 million annual run rate.

DuPont expects a loss of $.20 to $.30 per share for the fourth quarter 2008, excluding an estimated $.40 per share significant item charge for the company’s restructuring plan. The company expects 2009 earnings in the range of $2.25 to $2.75 per share, anticipating the current global recession will continue well into 2009.

The company said that the current quarter's sales are expected to be at least 15 percent lower than fourth quarter 2007. But it reaffirmed that it expects year-end free cash flow of about $1.3 billion and to generate about $2.5 billion in free cash flow in 2009, about double the level anticipated in 2008.

Viacom Inc. (NYSE: VIA and VIA.B) announced that it expects to reduce workforce by approximately 7 percent, or 850 positions as a part of restructuring plans and reduce overall costs with evolving economic conditions. The company said that it is also suspending senior level management salary increases for 2009.

The firm added its restructuring and write-down together will result in a pre-tax charge of $400 million to $450 million, or $0.42 to $0.48 per share, in the fourth quarter of 2008. Similar steps will be taken by the company in 2009, which will result in pre-tax savings of $200 million to $250 million.

Separately, Belden Inc. (NYSE: BDC) reported that it will reduce as many as 1,800 position, or 20 percent of its jobs and consolidate manufacturing operations, which will result in charges of between 85 cents to $1 a share.

The St. Louis-based maker of signal-transmission solutions for automation, data networks and electronics applications will generate $30 million in 2009 and $50 million a year beginning in 2011.

"As we reported in October, we have seen softening of our major markets globally, and we expect that economic conditions will remain challenging for some time," John Stroup, president and chief executive officer of Belden, said in a statement on late Wednesday.

He"Therefore it is necessary for us to further adjust our cost structure so that we can continue to be competitive under such conditions. We regret the hardship these actions will impose on our associates."

Zurich, Switzerland-based Credit Suisse Group Inc. on Thursday reported that it estimates a net loss of 3 billion Swiss francs ($2.46 billion) in the first two months of the fourth quarter and plans to cut as many as 5,300 jobs or 11 percent of its total workforce, primarily in investment banking segment.

The reduction in headcounts will save 2 billion Swiss francs ($1.64 billion), representing 9 percent of the bank's reported nine-month annualized 2008 cost base, the company said.

Nomura Holdings Inc. reported Thursday that it plans to hand out pink slips to as many as 1,000 employees out of its 4,500 total staff in London as the jobs overlap during the merger of the equities and investment banking operations of Lehman Brothers Holdings Inc.

Adobe Systems Inc. (ADBE) reported late Wednesday that it plans to slash up to 600 positions after it posted weak preliminary results for its fiscal fourth quarter and a sales outlook for the first quarter.

As a result of the cuts, the company is expecting to take pre-tax charges between $44 million and $50 million, including almost $30 million to be recorded in the current quarter.

Paris, France - Shares of Constellation Energy Group Inc. (NYSE: CEG) jumped by more than 20 percent on reports that it has received a rival bid from French state-controlled electricity giant Electricite de France SA on Wednesday (Dec. 3), which challenges Warren Buffett's previous merger bid.

Early this year, Constellation forged an agreement with Buffett’s Des Moines, IA-based MidAmerican Energy Holdings Co. to merge at a price of $4.7 billion or $26.50 per share.

On Wednesday, Electricite de France offered $4.5 billion (3.53 billion euros) for 50 percent of the nuclear business of Baltimore, MD-based Constellation.

EDF’s nuclear production capacity, the largest in the world, consists of 58 power plants on 19 sites. The company now is trying to capture more energy market in the U.S.

The company's proposal also includes an up-front $1 billion in cash investment in Constellation and an option pursuant to which Constellation could sell non-nuclear generation assets to EDF having an aggregate value of up to $2 billion.

The world’s biggest operator of atomic reactors also expects to receive the necessary regulatory approvals for the acquisition of its interest in the nuclear generation and operation business and close the transaction within six to nine months.

The closing for the deal would depend upon Constellation’s termination of its proposed transaction with MidAmerican and execution of a definitive agreement with the French power company.

“As Constellation’s largest stockholder, EDF has long admired and been a committed partner to the Company,” Chairman and Chief Executive Officer of EDF Pierre Gadonneix said. “Constellation is fundamentally strong and EDF, like many others, believes that the proposed MidAmerican transaction significantly undervalues Constellation and its future opportunities”

He continued: “We are confident that the terms of our proposal are demonstrably superior to those of the MidAmerican transaction.

In addition to providing Constellation stockholders with an opportunity to realize the value of their investment in the Company, our proposal provides more than sufficient liquidity to allow Constellation to remain a strong, standalone public company."

EDF said that its proposal is not subject to a financing condition and that approval from Constellation’s stockholders is not required.

Meanwhile, Constellation Energy said its Board of Directors will review the multi-faceted proposal.

However, it has not withdrawn, modified or qualified its recommendation that shareholders of Constellation Energy vote in favor of the merger with MidAmerican.

The special meeting of shareholders to vote on the merger with MidAmerican remains scheduled for 8:00 a.m. on December 23, 2008, the U.S. group said.

New York, NY - Abu Dhabi-based investment company Aabar Investments PJSC (Aabar) announced on Monday that it has acquired AIG Private Bank Ltd., a whole owned subsidiary of New York-based American International Group Inc. (AIG).

“We have looked very thoroughly at AIG Private Bank and are impressed by the professionalism and dedication of the management team and staff," H. E. Khadem Al Qubaisi, chairman of Aabar and future designated chairman of the bank, said in a statment on Monday.

"This transaction represents a great opportunity to leverage AIG Private Bank’s expertise in wealth management and to further develop it in our region. AIG Private Bank provides us with a platform with the potential for significant long-term growth and value creation."

The investment bank said AIG Private Bank will be acquired for 307 million Swiss francs ($254 million), subject to a post closing price adjustment based on the net asset value and assets under management of the bank at closing.

In addition, Aabar will assume certain loans outstanding at closing of the transaction up to an aggregate maximum of 100 million Swiss francs ($83 million), the global investment bank said.

This sends a clear message to our customers that we will continue to be a trustworthy, reliable and competent partner for them”, said Eduardo Leemann, CEO of AIG Private Bank. “It also offers us new opportunities to expand our operations, especially in the Middle East”, Leemann added.

Leemann and his senior management team will remain with the bank, which will become an independent financial institution with headquartered in Switzerland as well as subsidiaries and representative offices in Hong Kong, Shanghai, Singapore and Dubai.

Click Here For Press Release (*PDF File*).

Washington, D.C. - The U.S. regulators have revised their earlier recommendations and suggested that the domestic supply of infant formula is safe.

The Food and Drug Administration said that consumers can continue using U.S. manufactured infant formulas as the rpresent level of industrial chemical melamine in the products is safe.

"FDA has concluded that levels of melamine alone or cyanuric acid alone, at or below 1 part per million (ppm) in infant formula do not raise public health concerns. FDA has updated its interim risk assessment, issued in early October," the regulator said.

The FDA said it has been gathering and analyzing samples of domestically manufactured infant formula for the presence of melamine and melamine-related compounds.

It said, "To date, FDA tests have found extremely low levels of melamine in one infant formula sample and extremely low levels of cyanuric acid in another. The levels were so low (well below 1 ppm) that they do not pose a health risk to infants."

The U.S. regulators have stopped the import of Chinese milk products early this month after reports emerged that more than 50,000 infants have fallen sick on consuming melamine-tainted milk in the last few months.

The industrial chemical melamine, which is a chemical used in plastics and fertilizer, was also found in Chinese eggs, chocolate and some other products. Consumption of the chemical can cause damage to kidney or even death. At least four infants in China died after consuming the products.

According to the FDA, melamine is approved for use as part of certain food contact substances. While, low levels of melamine are present in the environment and trace amounts may occur in certain food commodities as a result of approved uses.


FDA’s Warnings/Advisories

The FDA is advising consumers not to consume the following products because of possible melamine contamination:
Fresh and Crispy Jacobina Biscuits
Koala’s March Crème filled Cookies
YILI Brand Sour Milk Drink
YILI Brand Pure Milk Drink
Blue Cat Flavored Drinks
White Rabbit Candies
Mr. Brown Mandehling Blend Instant Coffee (3-in-1)
Mr. Brown Arabica Instant Coffee (3-in-1)
Mr. Brown Blue Mountain Blend Instant Coffee (3-in-1)
Mr. Brown Caramel Macchiato Instant Coffee (3-in-1)
Mr. Brown French Vanilla Instant Coffee (3-in-1)
Mr. Brown Mandheling Blend instant Coffee (2-in-1)
Mr. Brown Milk Tea (3-in-1)
Infant formula manufactured in China

Production Sites Of ArcelorMittal

New York, NY - ArcelorMittal (NYSE: MT) is today meeting with its European Works Council to present voluntary separation programs to be launched across the group.

This is to help achieve the company’s stated aim of reducing SG&A (Selling, General and Administrative) expenditure by $1 billion in response to the current economic situation.

The focus is primarily on non-production employees, in particular those in SG&A functions across the globe. These programs may involve up to 9,000 employees, approximately 3% of the total global work force. ArcelorMittal is the world's leading steel company, with over 326,000 employees in more than 60 countries.

The processes will be run in close collaboration with stakeholders and in accordance with the appropriate social considerations of the respective countries involved.

“This has been a very difficult decision for the company to take as all of our employees are extremely important to us. Sadly however the global economic reality means that it is only sensible to adopt such measures," Bernard Fontana, executive vice president and member of ArcelorMittal’s management committee with responsibility for human resources, said in a statement.

"Our priority is now to meet with all our stakeholders to explain the reasons for this decision and to reassure them that the process will be carried out in accordance with all social considerations. We are very grateful for the professionalism and dedication of our employees, all of whom have played an important role in building ArcelorMittal."

In 2007, ArcelorMittal had revenues of $105.2 billion and crude steel production of 116 million tonnes, representing around 10 per cent of world steel output.

Click Here for Press Release.

OSAKA, Japan - Panasonic Corp. (NYSE:PC) today announced a revision of its consolidated financial results forecast for the current fiscal year ending March 31, 2009 (fiscal 2009).

The current financial crisis originated in the United States has spread across the world and the business sentiment in Japan and overseas has significantly worsened. Under these circumstances, the company’s business conditions are deteriorating sharply, due mainly to the rapid appreciation of the yen, sluggish consumer spending and ever-intensified price competition.

In addition, there are negative factors such as a write-down of investment securities as a result of the decline in stock prices and business restructuring expenses. Accordingly, Panasonic today announced a downward revision of the consolidated financial forecast for the full fiscal year 2009, ending March 31, 2009 from the previous forecast announced on April 28, 2008.

Regarding net sales on a consolidated basis, the company has revised its previous forecast of 9,200 billion yen downward to 8,500 billion yen. Consolidated operating profit1 is expected to amount to 340 billion yen, down from the previous forecast of 560 billion yen.

Consolidated income before income taxes is forecast to be 100 billion yen, down from the previously announced 500 billion yen. Net income is now expected to decrease from the previous forecast of 310 billion yen to 30 billion yen.

Click Here For Press Release.

Washington, D.C. - Is the Fed finally figuring it out?

Early Tuesday, the U.S. Federal Reserve and the Treasury have decided to step up their efforts to unfreeze credit for the consumers and home buyers by providing up to $800 billion, which is more than what Congress authorized in October.

But the news reports seemed to consider the billion-dollar plan as a backstop for the asset-backed-securities program originating entirely from its Troubled Asset Relief Program (TARP).

Secretary Henry Paulson announced the measure today "to finance the issuance of non-mortgage asset-backed paper in order to support lending to consumers and small businesses that is vital to our economy."

The consumer asset backed securities market is a source of liquidity to financial institutions that provide federally-guaranteed small business loans and consumer lending such as auto loans, student loans and credit cards.

The central bank of the country is prepared to purchase $600 billion in debt issued or backed by government-chartered housing-finance companies, according to Bloomberg News.

The remaining, issued by the Federal Reserve Bank of New York, will be used to aid consumer and small-business loans under Term Asset Backed Securities Loan Facility.

"By providing liquidity to issuers of consumer asset backed paper, the Federal Reserve facility will enable a broad range of institutions to step up their lending, enabling borrowers to have access to lower cost consumer finance and small business loans," Paulson said.

The statement from Paulson indicated that issuance of such securities in these areas reached $240 billion in 2007, "but credit market stresses led to a steep decline in the third quarter of 2008, and the market essentially came to a halt in October."