Business news in brief
In the Region
Merck backs 2007 forecast, posts 2008 guidance
Merck & Co. Inc., which has major operations in the Philadelphia area, reaffirmed its outlook for 2007 profit, excluding items, of between $3.08 and $3.14 per share. Including its announced $4.85 billion Vioxx settlement, legal and restructuring costs, and other items, Merck expects profit to range between $1.45 and $1.51 per share for the full year. In 2008, the company expects profit between $3.96 and $4.06 per share. Excluding one-time items, earnings per share are projected to range between $3.28 and $3.38. Both annual forecasts were a penny a share below Wall Street expectations. Merck shares fell 38 cents to $58.39.
Avax names successor to short-time CEO
Avax Technologies Inc., Philadelphia, has named Francois Martelet president and chief executive officer. Martelet succeeds Richard Rainey, who had been president since 2002 and CEO since June, and will continue as chief financial officer through at least May 31. Avax Technologies' lead vaccine candidate, M-Vax, is intended for late-stage melanoma.
- Linda Loyd
Trump shares fall with 3d executive defection
Shares of Trump Entertainment Resorts Inc., the casino company founded by Donald Trump, fell after its chief financial officer resigned. Dale Black quit Monday to accept a similar position with Isle of Capri Casinos Inc. Black, 44, is the third executive to leave Trump for St. Louis-based Isle of Capri in the last five months. Trump shares declined 30 cents, or 6.1 percent, to $4.62.
- Bloomberg News
NextStage raises $25 million for venture fund
NextStage Capital L.P., Audubon, said it had raised $25 million. Founded in 2006, NextStage Capital invests in "seed" and early-stage technology companies. The venture fund has provided financing to six software and hardware technology or services companies in the Mid-Atlantic region. They are: RCD Technology, Quakertown; Magnify Networks, New York City; HardMetrics, Doylestown; Agilence, Camden; HxTechnologies, Philadelphia; and Orbos, Newtown Square. NextStage Capital's $25 million investment was led by Ballamor Capital Management Inc., Radnor.
- Linda Loyd
Senate panel OKs bill that would delay FCC action
A Senate panel approved a bill to put the brakes on a plan to let broadcasters own a newspaper in the same media market. The Senate Commerce Committee approved the Media Ownership Act of 2007, which would delay passage by the Federal Communications Commission of any new media ownership rules for 180 days, or possibly longer, depending on whether studies on the impact of media consolidation on local communities and minority ownership are completed. The FCC is expected to vote Dec. 18 on a proposal by FCC Chairman Kevin Martin that would eliminate the ban on one company's owning a radio or television station and a newspaper in the same community in the nation's 20 largest markets.
High court backs railroads' challenge of tax bills
The Supreme Court ruled unanimously that railroads may challenge state methods for determining the value of their property, a decision that could lower some railroad tax bills. The court sided with CSX Transportation Inc. in a case from Georgia in which the railroad argued that the state improperly instituted a new way of calculating its property tax that resulted in a nearly 50 percent increase in its tax bill from one year to the next.
Dow to lay off 1,000 to save $180 million a year
Dow Chemical Co. said it was cutting 1,000 jobs, or about 2.3 percent of its workforce, as part of a plan to rid itself of underperforming businesses and boost its global efficiency. Dow expects the cuts to result in a charge of $500 million to $600 million for write-downs and severance packages in the fourth quarter of 2007. The company said it expected to save $180 million a year once the moves are made.
Rehearing granted on Mid-Atlantic power-line plan
The U.S. Energy Department said it would grant a rehearing on its October decision to declare the Mid-Atlantic region and two Southwest states as "national interest electric-transmission corridors," a new legal designation designed to foster power-line construction to ease the threat of blackouts. The Mid-Atlantic power corridor runs from Virginia to New York, including Delaware, New Jersey, and parts of Pennsylvania.
Senate backs U.S.-Peru free-trade deal
The Senate gave decisive backing to a U.S.-Peru free-trade agreement. The first bilateral trade deal approved by Congress this year is also the first under a new Democratic formula that requires negotiators to put labor rights and environmental standards on a par with tariff reductions, investor protections, and other key elements of the accord. The 77-18 Senate vote on the bill implementing the agreement followed a 285-132 House vote last month. U.S. trade with Peru is small-scale, about $9 billion a year.
Abbott Labs to lay off 1,250 in Calif., Ireland
Abbott Laboratories plans to cut about 1,250 jobs in California and Ireland, trimming capacity in the division that makes heart stents and other devices to treat blood vessels. Abbott, based in Abbott Park, Ill., will close a plant in Galway, Ireland, and cut jobs in Temecula, Calif., company spokesman Scott Stoffel said. While revenue increased, the company had a loss on vascular devices, including the stents, for the third quarter.
- Bloomberg News
Fla.-run fund unfrozen, but chief manager resigns
A Florida-run investment pool for local governments will reopen this week to give investors critical access to their cash, but the head of the agency that manages the fund resigned. The State Board of Administration voted unanimously to unfreeze the account, with restrictions, freeing some of the money that governments have in the fund. It was shut down last week after governments withdrew nearly $10 billion, or about 40 percent of the fund's assets. The run was caused by panic over the safety of certain mortgage-backed securities in the fund.
Clear Channel sale to investment firms delayed
Clear Channel Communications Inc. said its $19.5 billion acquisition by Thomas H. Lee Partners Inc. and Bain Capital L.L.C. would be delayed until next year because regulatory approval is unlikely by year-end. Clear Channel, which has six radio stations in the Philadelphia area, plans to extend the termination date for the transaction to June 12, and says the deal should close in the first quarter.
- Bloomberg News
Pelosi defies veto threat in $21 billion tax package
Defying a threat of a presidential veto, House Speaker Nancy Pelosi intends to push ahead with a $21 billion tax package, including repeal of tax breaks for major oil companies, as part of an energy bill, aides to the speaker said. Democratic leaders circulated a summary of the legislation that includes the new taxes as well as a requirement for a 40 percent increase in automobile fuel efficiency, a huge increase in the use of ethanol as a motor fuel, and a mandate for utilities to use renewable fuels.