Thirty states side with Enron shareholders seeking damages from investment banks…AT&T showcases its U-Verse integrated TV and Internet service at Las Vegas convention…Pilgrim’s Pride acquires Atlanta-based rival poultry processor Gold Kist…
Texas and 29 other states have sided with Enron shareholders seeking damages from several big investment banks. Houston-based Enron filed for bankruptcy protection in 2001. The states, in the brief written by Texas Attorney General Greg Abbott, maintain that some Wall Street banks are liable for participating in Enron securities fraud. Merrill Lynch & Company recently asked the Securities and Exchange Commission to file a brief in support of the firm’s position that it should not be held liable. A federal judge in Houston has allowed the matter to proceed as a class-action suit. That decision is being reviewed by an appeals court in New Orleans. Merrill in 2003 agreed to pay $80 million to settle SEC civil charges that it participated in Enron’s phony sales of floating power plants. The banking firm neither admitted nor denied wrongdoing.
East Texas poultry giant Pilgrim’s Pride said it has completed its acquisition of Atlanta-based rival poultry processor Gold Kist. A statement issued by Pittsburg-based Pilgrim’s Pride says it’ll now run Gold Kist as a wholly owned subsidiary. The acquisition resulted from Pilgrim’s Pride’s $1.1 billion tender offer for Gold Kist stock. The Pittsburg-based Pilgrim’s Pride says it expects to complete the acquisition of its Atlanta-based rival early next month. It also says all remaining owners of outstanding Gold Kist shares will have the right to get $21 in cash for each of their shares. Pilgrim’s Pride says it’s now the nation’s largest chicken producer by pounds. It says it’ll have nearly 25 percent of the market, compared to Tyson foods’ 21.4 percent. However Tyson, which also has large beef and pork operations, has $26 billion in annual revenue. That dwarfs the $7.4 billion of Pilgrim’s Pride and Gold Kist combined.
San Antonio based AT&T is showing off it latest package of entertainment and Internet services at the Consumer Electronics Show in Las Vegas. Charles Bornstein has the details.
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Goodyear Tire and Rubber says the multi-million dollar cost of a three-month strike by union workers is well worth the long-term savings it expects to see from the new labor deal. The world’s third-largest tire maker says the strike that began October 5th and ended last week drained between $30-and-$35 million a week from the company. At 12 weeks long, that means the walkout by the United Steelworkers Union could cost Goodyear between $360-and-$420 million. Company executives cushioned the news though, telling a conference call that the company plans to save $610 million over three years because of the agreement. And they say annual savings should come to about $300 million after that.