Katrina/Rita homeowners face deadline to apply for rebuilding grants…Former Enron shareholders take their case to Washington, DC…Marathon Oil buys $5.5 billion stake in Canadian oil sands market…
Homeowners affected by Hurricanes Katrina and Rita hustled to meet Tuesday’s deadline to apply for rebuilding grants. Both storms hit the Gulf Coast in 2005–with Katrina sending several hundred thousand Louisiana evacuees to Texas. The Louisiana-administered Road Home Program offers federal grants of up to $150,000. It’s funded with $6.4 billion. Louisiana authorities–in an effort to determine how many people are eligible–set an application deadline for the once open-ended program. Once they get the information, officials can then seek money from Congress to fill the gap. An official with the Louisiana Recovery Authority says the program is awarding about 10,000 grants per month. The authority estimates the program will run out of money by mid-December without additional cash.
Former Enron shareholders traveled to Washington DC to ask President Bush to help them hold Enron’s banking partners accountable for their lost savings. They presented their case to the Houston news media on Monday. The groups Center for a Just Society and Center for Justice & Democracy released a letter sent to President Bush, signed by 21 Enron victims, asking him to not intervene on behalf of defendants in a pending U.S. Supreme Court case that could determine the outcome of the Enron case. Bush has refused to allow the Securities and Exchange Commission to intervene on behalf of investors, even though the SEC voted to do so.
Marathon Oil has agreed to buy Western Oil Sands for $5.5 billion in cash and stock. The deal would give Houston-based Marathon a stake in Canada’s oil sands market. As part of the deal, Western is required to spin off Westernzagros, its wholly-owned subsidiary with interests in Kurdistan. The closing is expected in the fourth quarter of this year. Marathon says the agreement will give it a 20 percent interest in the Athabasca Oil Sands project in Alberta–currently held by Western Oil. Shell Canada and Chevron Canada hold the remaining 60 percent and 20 percent stake, respectively. Canada’s western region is home to vast reserves of sands rich in oil, bitumen-tar or other thick petrochemicals.
A Whole Foods Markets attorney tried to discredit a review that found its planned purchase of Wild Oats Markets–would be bad for consumers. The Federal Trade Commission has filed suit in Washington to block the deal. Whole Foods lawyer Paul Friedman argued that an expert witness called by the FTC did not consider relevant economic data. Whether a transaction will give a combined company greater pricing power is a key question in antitrust law. Austin-based Whole Foods is arguing that the FTC’s antitrust case is weaker without such data. Government’s witness Kevin Murphy, who’s a professor at the University of Chicago, said that the available pricing data is inadequate. The effort to buy Wild Oats has attracted attention due to internal e-mails and online postings of whole foods outspoken chief executive–John Mackey.
Whole Foods Market says its profit slipped in the most recent quarter despite higher sales, as the natural and organic retailer doubled spending on new stores.
The Associated Press reports banks led by Citigroup are not considering bailing out of a deal to finance the acquisition of Dallas-based TXU. One report said the $32 billion sale to private-equity firms led by Kohlberg Kravis Roberts and Texas Pacific Group appeared to hit a snag. Thomas Financial–citing unnamed sources–said underwriters offered to pay a $1 billion break-up fee to end the deal. The report said lenders wanted to avoid being stuck with $37.2 billion in debt to fund the utility purchase. KKR and Texas Pacific declined comment, as did Citigroup. But AP reports a person close to the deal, who spoke on condition of anonymity, dismissed the report–saying the deal continues as planned.
An experimental drug for cognitive disorders from Lexicon Pharmaceuticals of The Woodlands has completed the first phase of clinical trials, according to the Houston Business Journal. The drug LX6171 was generated by Lexicon’s small molecule drug discovery team to treat disorders characterized by Alzheimer’s disease, schizophrenia or vascular dementia. The company plans to file with European regulatory authorities for approval to begin the second phase of the trials in early 2008.
Texas-based Dell has delivered its first “made in India” computer. The Round Rock company hopes that production in India will lift domestic sales in a market that is growing at a 30 percent rate. The desktop computer from Dell’s new plant in southern India–near Chennai–was delivered Monday to outsourcing company Infosys Technologies Limited. Computer sales in India have increased 30 percent annually over the past five years. Dell says its new plant will initially make 400,000 desktop computers annually. The plant is the company’s third manufacturing location in Asia-Pacific and the ninth globally. Dell computers are relatively expensive in India. The company ships fully assembled systems into the country, paying more in duties than its rivals who manufacture locally.