Landry’s Restaurants says its board approved a $1.2 billion acquisition offer from a company owned by chairman and CEO Tilman J. Fertitta, sending shares soaring. The owner of Rainforest Café and other restaurants said that Fertitta’s company will pay $14.75 per share for Landry’s stock it doesn’t already own. Fertitta owned about 55.1 per cent of the company’s shares as of Monday. The deal is about a 37 per cent premium over Landry’s Monday closing stock price of $10.76. After the deal was announced, the company’s shares shot up nearly 28 percent. If the deal is approved by shareholders, it will end Fertitta’s pursuit of Landry’s. The deal is expected to close in the first half of 2010.
Breathing easier could soon be a reality in the Houston area, thanks to industry smog cleanup efforts and weather. The Houston Chronicle reports the region for the first time could meet federal limits for lung-irritating smog, based on a three-year running average. The Environmental Protection Agency says the data is preliminary and will be reviewed. EPA spokesman David Bary says the initial information indicates “the news is good.” Ozone, the key ingredient in smog, is produced when nitrogen oxides and volatile organic compounds, which are released from vehicles and smokestacks, heat in sunlight. The limit is 84 parts per billion, or 84 molecules of ozone for every billion molecules of air. Houston’s air, once considered dirtiest in the country, measured 84 parts per billion through Monday.
A jury has awarded $20 million to more than 170 Texas cities in a dispute over online booking companies and hotel occupancy taxes. Attorney Steve Wolens of Dallas, who represented the cities, said he expects an appeal by online booking agencies targeted in the 2006 lawsuit originally filed by San Antonio. The class-action suit, heard in San Antonio, was brought by cities in an effect to collect tourism tax revenue allegedly underpaid by Internet hotel room wholesalers. The Fort Worth Star-Telegram reports that an example was online companies booking blocks of rooms at $75 a night, reselling them for $100, then paying taxes on the lower rate.
Billionaire W arren Buffett’s Berkshire Hathaway has agreed to buy Fort Worth-based Burlington Northern Santa Fe. Buffett says Berkshire’s $34 billion investment in BNSF is a huge bet on that company, CEO Matt Rose and his team, and the railroad industry, Buffett says it’s more importantly what he calls an “all-in wager on the economic future of the United States.” Berkshire Hathaway already owns about 22 per cent of BNSF and plans to offer $100 a share in cash and stock for the rest of the company. The deal has been approved by the boards of both companies. It would be the biggest acquisition ever for Berkshire Hathaway. Berkshire also owns Midamerican Energy Holdings, which controls power companies in the Midwest and Pacific Northwest. BNSF’s tracks run through both regions–a major coal supply route for power plants.
Shriners Hospital for Children is set to reopen Wednesday nearly 14 months after Hurricane Ike pounded Galveston. Shriner Tommy Lambright from Texas City says services will resume in phases. Lambright told the Galveston County Daily News that the hospital should be fully operational by late December. The 30-bed hospital, which flooded when Ike came ashore on September 13th, 2008, is known for specializing in burn patients. Budget cuts have forced Shriners to consider accepting third-party payment for treating children, who will continue to be helped whether they can pay or not.
Iraq has finalized a deal with a British-Chinese consortium to develop the country’s largest oil field, a key step in its effort to revamp its dilapidated oil sector. BP and CNPC were the only companies to be awarded a contract during the OPEC member’s June licensing round–the country’s first such auction in over 30 years. The deal covers the Rumaila field, a 17.8 billion-barrel field in southern Iraq. The consortium wants to almost triple Rumaila’s current output to 2.85 million barrels per day in seven years, up from a million barrels per day. Under the 20-year contract, BP and CNPC will receive $2 for every barrel of crude produced. BP will hold 38 per cent stake in the project to CNPC’s 37 per cent. Iraq holds the rest.
Venezuela says it will not back an increase in OPEC oil production quotas despite a rise in world crude prices. Oil minister Rafael Ramirez says that while prices have recovered to Venezuela’s year-end goal of $70 a barrel, they are still volatile and must be stabilized. Ramirez said in comments published by the state-run Bolivarian News Agency that world oil inventories must also be depleted before supply is increased. The Organization of Petroleum Exporting Countries has cut production by a total of 4.2 million barrels per day since September 2008 to boost prices.
Ford says its U.S. sales rose three per cent in October, a positive sign for automakers who are hoping an improving economy brings buyers back to the showroom. Ford says it marked the 12th time in 13 months that its U.S. market share rose as it continues to grab buyers from competitors. Sales of cars and crossovers are seeing double-digit increases, while sales of sport utility vehicles and pickups are down. It’s more good news for Ford, which made nearly $1 billion in the third quarter. Ford’s North American division also reported its first profitable quarter in four years.
General Motors says its October sales rose 4.7 per cent over the same month last year, a sign that the U.S. auto market was starting a slow recovery from its yearlong slump. The nation’s largest automaker said it sold 176,632 light vehicles last month, up about 13 per cent from September sales. That’s when nearly all automakers reported dismal numbers because the government’s cash for clunkers rebates pulled September buyers into July and August.
Chrysler says its October sales fell 30 per cent below the same month last year. But they improved from September when the U.S. auto industry had a hangover from the government’s summertime cash for clunkers program. The maker of the Chrysler, Dodge, Jeep and Ram truck brands says it sold 65,803 vehicles last month, up six per cent from September. Chrysler, which is announcing a new product strategy on Wednesday, is aiming to show steady improvement from month to month as the U.S. economy starts to emerge from its yearlong slump. The automaker’s sales dropped 42 per cent in September following the end of hefty clunker rebates.
Wal-Mart has received final approval of a settlement in which it will pay between $65 million and $85 million to resolve wage-and-hour violations alleged by millions of workers. A Nevada district court judge in Las Vegas issued final approval of the settlement on Monday. It covers 39 class action lawsuits across multiple states against the world’s largest retailer. Last December, the Bentonville, Arkansas-based company said it would pay as much as $640 million to settle 63 lawsuits over wage-and-hour violations, ending years of dispute. The agreement ended the vast majority of such cases against Wal-Mart, but each settlement still had to be approved by a trial court. The lawsuits claimed the company failed to compensate workers for off-the-clock work and overtime, altered employee time records and prevented employees from taking breaks for rest and lunch. Settlements have been approved separately over the past several months in Minnesota, Washington and Iowa. Wal-Mart has said many of the lawsuits were filed years ago and the allegations are not representative of the company Wal-Mart is today.
Orders to U.S. factories rebounded in September, helped by strength in autos, heavy machinery and military aircraft. The fifth increase in six months bolsters hopes that a revival in manufacturing will help support an overall economic recovery. The worry is that if consumer spending falters in coming months, orders will slump again. The Commerce Department says orders rose 0.9 per cent in September, slightly better than the 0.8 per cent advance economists had expected. Demand increased for both durable goods and nondurable goods such as chemicals and energy products.
The Senate is moving toward approving a major economic relief bill that extends benefits to the jobless and expands a first-time home buyer tax credit. The legislation to give those exhausting their unemployment benefits up to 20 weeks of additional federal aid cleared a procedural hurdle Monday, setting up a vote to pass the bill later in the week. The measure also extends and expands the $8,000 first-time home buyer tax credit, which is set to expire at the end of this month, through next June and provides tax relief to companies that have been running in the red. The vote also effectively prevents Republicans from trying to amend the bill, particularly with a proposal to terminate the financial rescue plan known as the Troubled Asset Relief Program, or TARP.
If you plan to travel around the upcoming holidays, prepare to pay a little more–again. Several of the largest U.S. airlines have increased a surcharge for travel on the busiest travel days to $20 each way, up from $10. The surcharges apply to a large number of flights within the U.S. on more than a dozen peak days around holidays including Thanksgiving, Christmas and New Year’s. Tom Parsons runs the Arlington-based discount travel site Bestfares.com. He says Fort Worth-based American, along with Delta, United, US Airways and Northwest, all boosted their surcharge on some routes. American spokesman Tim Smith says that although airlines are filing the increases as a surcharge this time, “fares on those peak days have always tended to be higher.” Be calls it “a matter of supply and demand.”
Continental Airlines says its traffic rose 1.7 per cent in October, even as it reduced flying. Continental says it flew 7.26 billion revenue passenger miles, or one paying passenger flown one mile, across its system, including regional flights. That was up from 7.14 billion revenue passenger miles in October 2008. It says capacity in October fell 2.6 per cent compared to October 2008. Not counting regional partners, Continental says traffic rose 1.9 per cent to 6.47 billion revenue passenger miles. Continental’s load factor, or the percentage of seats filled, rose 3.5 percentage points to 82.5 per cent.
Anadarko Petroleum says its profits plunged during the third quarter, but that sales volume would jump next year despite spending decreases All oil and gas companies saw profit and revenues plunge over the past three months because they are being compared to one of the most lucrative periods in industry history last year. Anadarko reported net income was $200 million, which included $251 million in special items. The exploration and production company said revenue tumbled to $2.7 billion from $6.15 billion a year ago during the same period. Anadarko last month said it struck oil in deep waters off of West Africa.
Marathon Oil says its third quarter profit plunged from a year ago when record-high prices sent gasoline prices over $4 per gallon. Yet the Houston-based company says that production rose this quarter and for the entire year compared with 2008. The rising production numbers are in line with what other major oil and gas producers are reporting this quarter, as companies report major new finds and cut costs. Rebounding prices for crude have helped. Marathon said it made $413 million for the quarter ended September 30th, down from profit of $2.1 billion in the year ago quarter.