Business news in brief
In the Region
Luminent reports a rise in impaired mortgages
Luminent Mortgage Capital Inc., a Philadelphia investment company, estimated that $513.3 million of the $3.67 billion of residential mortgages backing securities it owns were impaired at the end of March, up from $352.8 million in December. In its delayed quarterly report, Luminent, which had moved its headquarters from San Francisco to Philadelphia this year, also said that it signed a six-year lease this month for 6,556 square feet of office here, an increase from its previous lease of 4,700 square feet at 2005 Market St. The base rent is $200,000 annually.
- Harold Brubaker
Customer satisfaction skids at Comcast
Customer satisfaction ratings for Comcast Corp., Philadelphia, fell this year to an all-time low and rank at the bottom of cable and satellite TV providers, according to a survey released today. As consumers' happiness with cable and satellite TV rose as a whole, the nation's largest cable TV operator lost ground, according to the University of Michigan's American Customer Satisfaction Index. Rapid growth for the company, which has been buying up smaller cable systems, may have added to its customer-service problems, the report said. Rick Germano, Comcast's senior vice president of national customer operations, said the cable giant was not happy about its ratings, but "we get it. We're listening."
GlaxoSmithKline gets Europe's OK for flu vaccine
GlaxoSmithKline P.L.C. said it had received permission from European medical regulators to market a human bird-flu vaccine that it has already sold to several governments to stockpile in preparation for a pandemic. The ruling from the European Medicines Agency makes Prepandrix, which targets the H5N1 virus, the first vaccine to receive a license for pre-pandemic use in all 27-member European Union states. Glaxo has a U.S. headquarters in Philadelphia, and operations in King of Prussia.
Wilmington Trust forms European company
Wilmington Trust Corp. announced an expansion of its corporate-client-services business in Europe with the formation of Wilmington Trust SP Services (Amsterdam) B.V. The new company will perform specialized trustee and corporate administrative services in the Netherlands, including collateralized debt obligation transactions, asset-backed securitizations and holding company services. The company said it had been expanding its corporate-client services in Europe since 2002. It began with an acquisition in London. More recently, Wilmington Trust has established a presence in other leading European jurisdictions, including Dublin, Ireland; Frankfurt, Germany; and Luxembourg.
- Chris Mondics
Air Products acquires engineering company
Air Products & Chemicals Inc., Allentown, said in a statement it had acquired Goar, Allison & Associates Inc., a process-engineering company involved in the development and promotion of improved sulfur-recovery technologies for the energy industry. Terms of the deal for the company, which is based in Tyler, Texas, are not being disclosed, but Air Products said Goar Allison's annual revenue was about $5 million.
- Rhonda Dickey
CSS unit acquires stationery-products firm
CSS Industries Inc., Philadelphia, said its C.R. Gibson L.L.C. company completed the acquisition of iota, a designer, marketer and seller of stationery products including notecards, gift wrap, journals and stationery kits. The purchase price was not disclosed, and a CSS representative was not immediately available for comment. In addition, iota also operates a surface design and licensing program, CSS Industries said in a release. CSS shares closed up 20 cents at $30.82.
- Roslyn Rudolph
Bush to sign a bill halting the filling of oil reserve
President Bush still thinks a bill forcing his administration to temporarily stop acquiring oil for its emergency stockpile is a bad idea, but he'll sign it anyway, a spokesman said. In a bipartisan rebuke, the Senate last week voted, 97-1, and the House, 385-25, for the legislation. "I think he saw the overwhelming numbers of members of Congress who want to attempt to have an impact on prices by stopping the fill of the Strategic Petroleum Reserve," the spokesman said of the president's decision. Sponsors of the bill said they hoped to lower energy prices. But the administration said the amount of oil involved, about 76,000 barrels a day, was relatively small and would have no effect on gasoline prices.
Firms to pay penalty over Ariz. water pollution
Motorola Inc., Siemens AG, and GlaxoSmithKline P.L.C. - which all have operations in the Philadelphia area - agreed to pay a combined $500,000 civil penalty to resolve U.S. allegations that the companies were responsible for polluting the Scottsdale, Ariz., drinking-water system. The settlement, filed in federal court in Phoenix yesterday, resolves allegations the companies failed to treat the groundwater after it was contaminated with trichloroethylene, an industrial solvent. Motorola, Glaxo and Siemens also did not notify regulators about the discharges though they were under a court-approved agreement to do so, the U.S. Justice Department said.
- Bloomberg News
U.S. sues AOL ex-officials over ad-revenue claims
Eight former America Online Inc. executives, including chief financial officer John Michael Kelly, were sued by federal regulators for allegedly helping overstate Internet advertising revenue by more than $1 billion from 2000 to 2002. Four of the executives agreed to pay more than $8 million to settle the Securities and Exchange Commission's civil suit filed in federal court in New York, the agency said in a statement. The regulator's allegations are still pending against Kelly, 51, and three others.
- Bloomberg News
Longtime GE executive to replace Dell's CFO
Donald J. Carty, who became Dell Inc.'s chief financial officer less than 18 months ago when the computer-maker's accounting was under scrutiny, is stepping down and will be replaced by a longtime General Electric Co. executive. Brian T. Gladden, chief executive officer of SABIC Innovative Plastics, formerly called GE Plastics, will join Dell today and succeed Carty as CFO on June 13. Dell spokesman David Frink said Carty, 61, was not pushed out.
Short-term T-bill rates rise to nearly 3-month high
Interest rates on short-term Treasury bills rose in yesterday's auction to the highest levels in nearly three months. The Treasury Department auctioned $25 billion in three-month bills at a discount rate of 1.855 percent, up from 1.800 percent last week. An additional $23 billion in six-month bills was auctioned at a discount rate of 1.885 percent, up from 1.850 percent last week. The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,953.11, while a six-month bill sold for $9,904.70.
Yield on 1-year T-bills rises to 2.07 percent
The Federal Reserve said yesterday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 2.07 percent last week from 1.94 percent the previous week.