A round-up of today's other business news in brief
India and Asean sign trade pact
India and the 10-country Southeast Asian bloc Asean signed a free trade agreement yesterday after more than six years of negotiations, but the deal did not embrace software and information technology. The agreement will eliminate tariffs on electronics, chemicals, machinery and textiles. – (Reuters)
Warning US may ‘run out of sugar’
Large US food companies have been pushing the Obama administration to ease sugar import curbs, citing forecasts for unprecedented sugar shortages that could result in higher retail prices and possible job losses.
In a letter to US agriculture secretary Tom Vilsack, companies including Kraft Foods, General Mills and Hershey warn that “our nation will virtually run out of sugar” if a USDA forecast is accurate.
US authorities said the stocks-to-use ratio in the US sugar market for stood at 6.7 per cent, up from 3.4 per cent in last month’s report. – (Reuters)
Ford to increase production
Ford Motors said it would increase production over the rest of the year after a surge in sales triggered by the US government’s “Cash for Clunkers” sales incentive programme.
Ford has emerged as one of the clear winners from the $3 billion sales programme which offers rebates of up to $4,500 for consumers who trade in older and less fuel-efficient vehicles.
In response, Ford said it would build another 6,000 Focus sedans in the current quarter by adding overtime and a Saturday shift at an assembly plant in Wayne, Michigan.
A second plant in Kansas City, Missouri, will drop plans to shut down for two days later this month and increase output of the Escape small SUV by another 3,500 vehicles. – (Reuters)
Microsoft ordered to alter Word feature
Microsoft, facing a judge’s order to stop using a patented feature in its Word program, has two months to change the software, settle with a Canadian company or ask a court to put the order on hold.
“Either a settlement or a stay pending appeal is the most likely outcome,”said analyst Rob Helm. “It’s not something the company’s going to mess with.”
On Wednesday, a judge ordered Microsoft to stop providing the feature, which helps customise extensible markup language, or XML, a way of encoding data to exchange information between programs. The judge also ordered Microsoft to pay about $290 million to patent owner I4i LP. – (Bloomberg)
VW to pay 3.3bn for Porsche stake
Volkswagen has agreed to buy a 42 per cent stake in the sports car unit of debt-ridden Porsche SE, another step toward combining the two German carmakers into a European automotive giant.
VW will pay up to €3.3 billion this year for the initial stake in the unit, Porsche AG, paving the way for the creation of an “integrated” automotive group by the end of 2011, VW and Porsche said in statements after board meetings. Volkswagen chief executive Martin Winterkorn, who is poised to run the combined entity, said the deal marked “a new era” for both companies. – (Reuters)
Quinn Group
In response to a comment in yesterdays Media Marketing column to the effect that the Quinn Group is “highly-leveraged”, the company has asked us to point out that its debt/Ebitda ratio over the past three financial years has ranged between 1.6 times and 2.1 times, which is well below that of many listed Irish plcs.
