Morgan Stanley to Cut 1,000 U.S., U.K. Mortgage Jobs

Morgan Stanley to Cut 1,000 U.S., U.K. Mortgage Jobs

Feb. 13 (Bloomberg) -- Morgan Stanley, the second-biggest U.S. securities firm, will eliminate 1,000 jobs by scaling back its U.S. residential mortgage business and closing the Advantage Home Loans unit in the U.K.

The firm will continue its mortgage-servicing business, Saxon Mortgage Service Inc., and offer loans to retail brokerage clients, New York-based Morgan Stanley said today in a statement.

Banks and brokers have eliminated at least 19,000 jobs in the past six months as they racked up $146 billion of writedowns and credit losses tied to mortgage securities. Morgan Stanley, which reported its first quarterly loss in December, cut 900 jobs in 2007 from areas that offered mortgages, packaged and traded debt securities and provided high-yield loans amid the worst U.S. housing market in 26 years.

``They should have gotten out of it two to three years ago, but they were making too many fees like everyone else in the business,'' said Malcolm Polley, chief investment officer at Stewart Capital Advisors in Indiana, Pennsylvania, who manages $1 billion, including Morgan Stanley shares. ``I would not expect them to be the first ones or to be the last ones to do this.''

Morgan Stanley, the No. 2 securities firm by market value behind Goldman Sachs Group Inc., said last month it would cut 1,000 more jobs in businesses including asset management and retail brokerage and support areas such as technology and administration.

`Continued Dislocation'

``Given the continued dislocation in the mortgage markets, we have restructured our residential mortgage business to ensure we are appropriately positioned for the environment going forward,'' Anthony Meola, chief operating officer of the U.S. residential business, said in the statement.

The bank also plans to cut 40 jobs in its securitization business in Japan, two people with knowledge of the matter said.

Morgan Stanley, which has lost 19 percent of its market value this year, gained 52 cents to $43.23 in composite trading on the New York Stock Exchange at 4:20 p.m.

Morgan Stanley bought Advantage in December 2005, joining banks including New York-based Lehman Brothers Holdings Inc. and Merrill Lynch & Co. to set up units making home loans to U.K. borrowers and packaging then into securities. The bank also bought mortgage lenders in Italy and Russia.

Shunning Debt

Sales of bonds backed by mortgages and other assets fell in Europe or the first time last year as investors shunned all but the safest securities amid losses on subprime mortgages, making it harder for mortgage companies that rely on asset-backed debt to borrow.

GMAC LLC, the former financing unit of General Motors Corp., said in October it will close its U.K. High Street Home Loans unit and cut 200 jobs because of ``unprecedented volatility'' in global credit markets. Paragon Group Cos., a U.K. lender to landlords, has had to cut new loans and raise 287 million pounds ($563 million) through a share sale to cover a funding shortfall and higher credit costs.

``When the mortgage markets shut down you need to be nimble and lay off some of these workers,'' said William Fitzpatrick, who helps manage $1.8 billion at Optique Capital Management and last month sold 300,000 Morgan Stanley shares. ``This is typical of the cycle.''

BLOOMBERG

Bush Signs $168 Billion Measure Designed to Stimulate Economy

Bush Signs $168 Billion Measure Designed to Stimulate Economy

Feb. 13 (Bloomberg) -- President George W. Bush signed into law today a $168 billion economic stimulus package designed to avoid a recession by boosting spending among consumers and businesses.

U.S. economic growth ``has clearly slowed,'' Bush said in a ceremony at the White House, surrounded by congressional Democrats and Republicans who put aside differences to pass the measure last week. ``The bill I'm signing today is large enough to have an impact,'' Bush said.

Rebate checks will be sent to more than 130 million Americans beginning in May. Those eligible for payments include 20 million senior citizens and 250,000 disabled veterans.

The stimulus package would cost the Treasury about $151.7 billion this year and an additional $16.3 billion next year, according to the Joint Committee on Taxation. The measure also gives tax incentives to businesses to invest in new equipment.

Economic growth in the fourth quarter slowed to a 0.6 percent annualized pace, and U.S. employers cut jobs in January for the first time in four years, raising concern about a possible recession.

Under the rebate program, people will get a check of up to $600 for individuals and $1,200 for couples, plus $300 for each child. Rebate checks for $300 would be sent to those whose Social Security benefits, veterans' disability payments and earned income that totaled at least $3,000 last year.

The rebates would be phased out for individuals earning more than $75,000 or couples earning more than $150,000.

BLOOMBERG

News Corp., Yahoo in Talks Over Combination, WSJ Says

News Corp., Yahoo in Talks Over Combination, WSJ Says

Feb. 13 (Bloomberg) -- Yahoo! Inc., seeking to thwart Microsoft Corp.'s $44.6 billion takeover bid, is in talks about a combination with News Corp.'s Internet assets instead, the Wall Street Journal reported.

Rupert Murdoch's News Corp. would get a stake in Yahoo that could be more than 20 percent, the newspaper said on its Web site today, citing people familiar with the matter. The deal would include a cash contribution from News Corp. and a buyout firm.

An agreement would bring together Yahoo, owner of the most- visited U.S. Web site, with News Corp.'s MySpace, the most popular social-networking site. It would allow Yahoo to remain independent, while bolstering News Corp.'s online advertising assets. Yahoo rejected the bid from Microsoft two days ago, saying the offer didn't reflect its value.

``It could make sense in some form,'' David Joyce, an analyst with Miller Tabak & Co. in New York, said in an interview. ``They could gain more access to the overall ad industry on the Web this way.''

News Corp., based in New York, and Sunnyvale, California- based Yahoo have spoken several times in the past 18 months about a combination, the newspaper said.

News Corp. spokeswoman Julie Henderson declined to comment. Yahoo's board is still evaluating all its options, spokeswoman Tracy Schmaler said. She declined to comment on News Corp.

The talks were reported yesterday by the blog TechCrunch, which said the investment by News Corp. and a private equity fund into Yahoo might be $15 billion.

Murdoch's Reversal

A deal with Yahoo would mark a turnaround from Murdoch's previous comments. On a Feb. 4 conference call, he said News Corp. isn't interested in buying Yahoo.

When asked whether he would pursue a combination of MySpace and Yahoo, he said, ``I think that, that has passed, but you never know,'' according to a Bloomberg transcript. He also said it is an ``exaggeration'' to say the two companies had been in talks about such an agreement.

Murdoch bolstered News Corp.'s online assets with acquisitions such as the $580 million purchase of MySpace in 2005 and by partnering with companies including Google Inc., the owner of the most-used Internet search engine.

In the potential Yahoo deal, Murdoch is trying to gain a valuation for MySpace of $6 billion to $10 billion, the Wall Street Journal said.

``The value they can get for MySpace, my guess is, will be much higher than the value ascribed by the market,'' David Bank, an analyst at RBC Capital Markets in New York, said in an interview. ``There's not a lot of downside to News Corp.''

Yang's Baby

Yahoo gained 31 cents to $29.88 at 4 p.m. New York time in Nasdaq Stock Market trading. News Corp.'s Class A shares fell 12 cents to $19.25 in New York Stock Exchange composite trading. Microsoft, the world's largest software maker, rose 62 cents to $28.96 on the Nasdaq.

Microsoft's $31-a-share bid for Yahoo is the company's best chance to challenge Google's dominance in Web search and online advertising, said Colin Gillis, an analyst with Canaccord Adams in New York. Both Yahoo and Microsoft are lagging behind Google, which has increased sales faster and won over consumers and advertisers with its search engine.

With a News Corp. combination, Yahoo Chief Executive Offer and co-founder Jerry Yang would avoid selling the company to Microsoft while still helping it catch up with Google. Yang considers Yahoo his ``baby'' and would prefer not selling outright, Gillis said.

Access to MySpace

Yahoo would also gain access to MySpace at a time when it is losing sales of banner ads to social-networking sites. MySpace and rival Facebook Inc. probably grabbed three-quarters of social-networking ad revenue in 2007, according to New York-based researcher Emarketer Inc.

Yahoo unsuccessfully bid $1 billion to buy Facebook in 2006. The company in September started testing a networking service of its own called Mash that lets users add photos and information about themselves to their pages and accept contributions from friends. Yahoo's older networking service, Yahoo 360, is slated to be phased out or consolidated after it lost users.

Yahoo and News Corp.'s Fox Interactive Media rank as the top two in their share of the market for graphical display ads that can include online banners and billboards, according to researcher ComScore Inc. in Reston, Virginia. Yahoo had 19 percent of the market in November, while Fox had 16 percent. Microsoft had 6.7 percent, ComScore said.

Microsoft Looming

Even with a rival suitor, Microsoft remains the strongest candidate to acquire Yahoo, Gillis said in an interview today.

Microsoft made its cash-and-stock offer on Feb. 1, which Yahoo's board rejected on Feb. 11. The bid, which was 62 percent more than Yahoo's closing price the day before, ``substantially undervalues'' the company, Yahoo's board said.

Yahoo's search for other bidders may be part of a plan to get Redmond, Washington-based Microsoft to raise its price, analysts including Stanford Group Co.'s Clayton Moran said. Microsoft may increase its offer to $40 a share, Gillis said.

``This could be an attempt to use News Corp. as a pawn,'' Michael Nathanson, an analyst at Sanford C. Bernstein & Co. in New York, said in an e-mail.

TO ΑΥΡΙΑΝΟ ΠΡΟΓΡΑΜΜΑ (ΑΜΕΡΙΚΗ)

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International Trade
Dept of Commerce


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Jobless Claims
Dept of Labor

MGIC Loses $1.47 Billion in Quarter, Seeking Capital

NEW YORK, Feb 13 (Reuters) - MGIC Investment Corp, the largest U.S. mortgage insurer, posted on Wednesday a much larger-than-expected $1.47 billion quarterly loss as more homeowners fell behind on payments, and claims increased sevenfold.
The company also said it hired an outside adviser to help it raise capital and expects to lose money this year unless the credit environment improves. Its shares fell $2.19, or 15.4 percent, to $11.99 in morning trading.

Like many insurers, Milwaukee-based MGIC has been battered as borrowers have missed payments and investors have stopped buying a wide variety of debt perceived to carry too much credit risk.
MGIC's fourth-quarter loss equaled $18.17 per share, and compared with a profit of $121.5 million, or $1.47 per share, a year earlier. Revenue rose 9 percent to $399.1 million.

Analysts on average had expected a loss of $8.13 per share on revenue of $388.1 million, according to Reuters Estimates.
MGIC said claims totaled $1.35 billion, up from $187.3 million a year earlier and $50 million more than it had estimated last month. It also set aside $1.2 billion pretax for losses related to Wall Street securitizations and took a $33 million charge for a collapsed subprime mortgage venture.
"Obviously, these financial results are unacceptable," Chief Executive Curt Culver said on a conference call.

Culver said MGIC has been boosting premiums and improving underwriting standards in struggling housing markets such as Arizona, California, Florida, Michigan and Nevada.
"While we may lose share to reflect our underwriting changes, we will lose it for the right reasons," he said.
Defaults on privately insured U.S. mortgages rose 37 percent in December to the highest level on record, according to the Mortgage Insurance Cos of America, a trade group.

CAPITAL-RAISING

"It now seems inevitable that the company will have to raise significant amounts of dilutive capital to preserve its 'double-A' (credit) rating and the long-term viability of the business," wrote Bruce Harting, an analyst at Lehman Brothers Inc. He rates MGIC "underweight."

On the conference call, MGIC executives said the capital-raising could involve reinsurance or convertible securities issuance. MGIC would likely raise less than $1.5 billion, and doesn't need capital immediately, they said.
Shareholder equity fell to $2.59 billion from $4.3 billion a year earlier, and book value per share fell to $31.72 from $51.88, MGIC said.
MGIC and rivals Radian Group Inc and PMI Group Inc posted their first-ever losses in the third quarter.

For all of 2007, MGIC lost $1.67 billion, or $20.54 per share, as claims nearly quadrupled to $2.37 billion from $613.6 million.
MGIC's forecast of a loss for 2008 was not a surprise. Analysts' average forecast is a loss of $7.72 per share for the year.
A year ago, MGIC had agreed to a $5 billion merger with Radian. The merger collapsed in September after both companies saw their shares plunge and wrote off much of their $1.03 billion investment in the subprime venture Credit-Based Asset Servicing and Securitization LLC, better known as C-BASS.
MGIC's $33 million charge related to losses at C-BASS, which reduced the value of a $50 million note to zero.

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U.S. Retail Sales Unexpectedly Rose 0.3% in January

Feb. 13 (Bloomberg) -- Retail sales in the U.S. unexpectedly rose in January as Americans spent more on cars, clothes and gasoline, a sign that the biggest part of the economy is holding up even as the housing slump deepens.

The 0.3 percent increase followed a 0.4 percent decrease the previous month, the Commerce Department said today in Washington. Excluding automobiles, purchases gained 0.3 percent after a 0.3 percent decline in December.

The figures may ease concern that the U.S. has already slipped into recession because of falling home prices and a weakening labor market. Demand from consumers, whose spending accounts for about 70 percent of the economy, will probably still wane in coming months, forcing the Federal Reserve to lower interest rates further, economists said.

``Today's report will diminish recession anxieties, but it doesn't dispel them altogether,'' said Richard DeKaser, chief economist at National City Corp. in Cleveland, who accurately forecast the sales gain. ``The Fed will still likely cut rates in March because the preponderance of evidence, particularly the labor market, suggests recession risks remain.''

Treasury securities dropped after the report, with 10-year note yields rising to 3.70 percent at 9:03 a.m. in New York, from 3.66 percent late yesterday.

Economists' Forecasts

Retail sales were projected to fall 0.3 percent after an originally reported 0.4 percent decline the prior month, according to the median estimate in a Bloomberg News survey of 81 economists. Estimates ranged from a decline of 1.2 percent to a gain of 0.3 percent.

Consumers are facing the worst housing slump in a quarter century at the same time that access to credit is shrinking. The economy lost 17,000 jobs in January, the first drop in more than four years. The Standard & Poor's 500 Index has fallen three consecutive months, the longest losing streak since 2003.

Sales excluding automobiles and gasoline were unchanged. Today's report showed sales at automobile dealerships and parts stores rose 0.6 percent after a decline of 1.1 percent in December.

That contrasts with industry figures that showed cars and light trucks sold last month at a 15.2 million annual pace, down 6.7 percent from December. Auto industry sales this year are forecast to drop to the lowest level since 1998.

Gasoline Sales

Filling station sales rose 2 percent in January after remaining unchanged the prior month, today's report showed. Regular gasoline reached as high as $3.11 a gallon in early January, about 11 cents more than the average for the prior month, according to AAA. Excluding gas, retail sales rose 0.1 percent.

Sales also rose at clothing retailers, which posted a 1.4 percent increase, and grocery and beverage stores, which gained 0.6 percent. Purchases at non-store retailers, which include online and catalog sales, rose 0.5 percent.

Department-store sales dropped 1.1 percent. Stores selling building materials showed a 1.7 percent decrease in sales, after falling 2.5 percent. Sales also fell at electronics, appliance and sporting goods stores.

Excluding autos, gasoline and building materials, the retail group the government uses to calculate gross domestic product figures for consumer spending, sales rose 0.2 percent, after a 0.1 percent decrease the prior month. The government uses data from other sources to calculate the contribution from the three categories excluded.

Target, Nordstrom

Today's Commerce Department report also runs counter to industry figures that show January sales fell at stores from Target Corp. to Nordstrom Inc. even as some retailers slashed prices by as much as 75 percent. Sales at stores open at least a year rose 0.5 percent from a year earlier, the worst January since 1970, according to the International Council of Shopping Centers.

The industry figures account for about 17 percent of total retail sales, which make up almost half of consumer spending. Retailers' January results followed the worst holiday shopping season since 2002, according to ICSC.

Consumers are increasingly limiting expenses to those they can't avoid. The amount Americans must spend each month on debt service, housing, medical costs, and food and energy bills rose to 66.9 percent of their total spending in December, the highest since records began in 1980, according to Bloomberg figures.

A U.S. recession over the next 12 months is now an even bet, according to a Bloomberg survey of economists taken from Jan. 30 to Feb. 7. The odds of a recession rose from 40 percent in January.

BLOOMBERG

Coca-Cola Net Climbs on Soda Sales in China, Mexico

Coca-Cola Net Climbs on Soda Sales in China, Mexico

Feb. 13 (Bloomberg) -- Coca-Cola Co., the world's largest soft-drink maker, said fourth-quarter profit climbed more than analysts estimated on higher sales of soda in Asia and Latin America and Vitaminwater in the U.S.

Net income rose 79 percent to $1.21 billion, or 52 cents a share, from $678 million, or 29 cents, a year earlier when its largest bottler wrote down the value of North American operations, Coca-Cola said today in a statement. Excluding restructuring costs, the company earned 58 cents a share.

Coca-Cola sold more soda in China and Mexico and benefited from the dollar's decline against other currencies. Chief Executive Officer Neville Isdell promoted no-calorie Coca-Cola Zero and Vitaminwater to counter waning U.S. demand for sugary soda and narrow the gap with PepsiCo Inc. and Nestle SA in the non-carbonated drinks market.

``They're really putting a lot of money behind this Vitaminwater,'' Walter Todd, who helps manage $800 million in assets for Greenwood Capital Inc. in South Carolina, said in an interview on Bloomberg Radio ``I think Coke's doing the right thing by trying to diversify away from the soft drinks.''

Sales climbed 24 percent to $7.33 billion, the Atlanta- based company said.

Eleven analysts surveyed by Bloomberg estimated average profit of 55 cents. They predicted sales of $6.88 billion.

Coca-Cola rose 42 cents to $59.92 yesterday in New York Stock Exchange composite trading. The stock fell 2.4 percent this year before today, compared with a 5.2 percent decline by PepsiCo, the world's second-largest U.S. soda maker.

Earnings Growth

Isdell said last year that he expects annual earnings per share to grow by as much as 9 percent. He told the German magazine Capital last month that sales volume would increase by 2 percent a year in the U.S. and more abroad.

Volume in Japan and North America, two of Coke's most profitable markets, gained 1 percent, the company said.

Coca-Cola gets almost three-quarters of its revenue from outside the U.S., while PepsiCo generates about 40 percent of sales overseas.

The dollar's decline against foreign currencies during the quarter contributed 8 percentage points of growth to Coca- Cola's sales, higher than the 5.5 percentage points estimated by William Pecoriello, an analyst at Morgan Stanley in Purchase, New York.

The dollar averaged 10 percent less in the quarter against the Federal Reserve's basket of currencies than a year earlier.

Sales of soda in the U.S., Coca-Cola's largest market, have fallen in volume since 2005, according to industry newsletter Beverage Digest.

Coca-Cola Zero

``They are talking about getting more drinkers into the cola category, which is great, with this Coca-Cola Zero,'' said Mariann Montagne, an analyst with Thrivent Asset Management in Minneapolis. Montagne's firm manages $70 billion in assets, including Coca-Cola shares.

The beverage maker is marketing Coca-Cola Zero, which it says tastes similar to Coca-Cola Classic, to young men who have moved to sports drinks and other non-carbonated beverages with fewer calories.

Coca-Cola's Powerade sports drink and Nestea-brand bottled teas trail PepsiCo's Gatorade and Lipton bottled teas in sales, according to Beverage Digest.

Coca-Cola bought Energy Brands Inc.'s Glaceau Vitaminwater for $4.1 billion last year. The fourth quarter was Coca-Cola's first full period selling Vitaminwater.

Coca-Cola, which controls one-tenth of the world's bottled-tea market, agreed last week to pay $43 million for a 40 percent stake in Honest Tea Inc., the maker of low-calorie organic bottled tea.

PepsiCo reported last week a 17 percent increase in fourth-quarter sales to $12.3 billion on gains from Gatorade and Lipton bottled tea in the U.S. and Doritos snacks in China and India. Net income fell 31 percent because of a tax gain a year earlier.

BLOOMBERG

Bank of England Indicates Scope for Rate Cuts Limited

Bank of England Indicates Scope for Rate Cuts Limited

Feb. 13 (Bloomberg) -- The Bank of England raised its inflation forecast and signaled policy makers may need to keep interest rates higher than investors currently predict.

Inflation will overshoot the central bank's 2 percent goal in two years and risks breaching the government's 3 percent limit before then, the bank said in London today. The bank based its forecasts on investors' bets for the benchmark interest rate to fall to 4.5 percent by the end of the year.

The pound rose and rate futures climbed. Bank of England Governor Mervyn King is weighing the need for further rate cuts after the bank reduced borrowing costs last week for the second time in three months to cushion the economy from a slowdown. While the U.S. Federal Reserve lowered its benchmark at the fastest pace since 1990 last month, U.K. policy makers have been more cautious as they seek to control inflation.

``Inflation is, in the medium term, more likely to be above the target than below'' if rates fall as investors forecast, King told reporters in London today. King said it's ``odds on'' inflation will exceed 3 percent and he'll have to write a letter of explanation to Chancellor of the Exchequer Alistair Darling.

The pound rose as much as 0.2 percent to $1.9655 in London and traded at $1.9638 at 11:12 a.m. in London. Rate futures also increased, with the implied yield on the contract maturing in December climbing 5 basis points to 4.69 percent.

The Bank of England on Feb. 7 cut the benchmark rate by a quarter-point to 5.25 percent.

Predicament

King expects a ``marked slowing'' in growth and the central bank cut its forecast, predicting the pace will trough at about 1.6 percent late this year. In November, the bank predicted the expansion would slow as far as 2 percent in 2008. The bank releases forecasts in the form of fan charts instead of specific numbers.

``The inflation report underlines the bank's predicament,'' said Christoph Rieger, an economist at Dresdner Bank AG in Frankfurt. ``The projected growth slowdown is somewhat deeper and more prolonged than in November. Overall, the report may prevent the Bank of England from easing more aggressively in the near- term.''

The Bank of England's benchmark will reach 4.5 percent by the end of the year, according to the median forecast of 44 economists in a Feb. 1 Bloomberg News survey.

Faster Inflation

Inflation accelerated to 2.2 percent from a year earlier in January, the most since June, compared with 2.1 percent in December, the Office for National Statistics said yesterday in London. Producer prices rose 5.7 percent from a year earlier, the quickest pace since 1991, data showed Feb. 11.

Rising energy and food costs have prompted some central banks to increase rates even after the Fed last month cut its benchmark by 125 basis points to 3 percent. Swedish policy makers lifted their key rate to 4.25 percent today, the Reserve Bank of Australia on Feb. 5 raised its benchmark to 7 percent and Group of Seven officials meeting in Tokyo on Feb. 9 said they're concerned about ``heightened inflation expectations in some countries.''

Some economists said the growth slowdown will force the bank to keep cutting.

``The message the bank would like to get across to the market is that there is only room for moderate easing ahead, but the fundamentals say otherwise,'' said David Brown, chief European economist at Bear Stearns International.

`Balancing Act'

U.K. retail sales will drop this year as consumer spending weakens, increasing the number of bankruptcies in the industry, London-based market researcher Verdict Research said. The housing- market slump deepened in January to the worst since the British economy emerged from its last recession in 1992, the Royal Institution of Chartered Surveyors said today.

``It's possible there will be falls'' in house prices, said King. The bank faces ``a difficult balancing act'' as it tries to control inflation while preventing growth grinding to a halt, he said.

At the same time, King urged economists and investors to steer clear of ``doom and gloom'' when assessing the slowdown. U.K. unemployment fell for a 16th month to a three-decade low in January, the Office for National Statistics said today.

``If you look at the facts, we've seen unemployment falling and growth for the fourth quarter was 0.6 percent, which is very close to long-run average growth rate of the U.K. economy,'' he said. ``I would encourage you to present a balanced picture.''

BLOOMBERG

Why insurers are rebuffing Buffett

Berkshire Hathaway's offer to the troubled bond insurers is presented as a rescue, but its terms may be too tough for the companies' shareholders to accept.



NEW YORK (Fortune) -- Berkshire Hathaway's latest foray into bond insurance is classic Warren Buffett. The Omaha billionaire has floated a proposal that is highly favorable to him and his shareholders - and excruciatingly tough on the companies he is targeting. But while the proposal has been widely described as a rescue, there are signs that Buffett's prey - including publicly traded Ambac and MBIA - aren't yet desperate enough to take the deal.

On Tuesday, Berkshire released a letter it sent to three bond insurers - understood to be Ambac, MBIA and closely held FGIC - offering to take over their municipal insurance obligations. Berkshire says the deal will allow the companies to focus on their other businesses, including the credit derivatives portfolios that have put the insurers under the close scrutiny of the ratings agencies.

Under the deal, Berkshire would take in $6 billion worth of so-called unearned premiums - money the insurers have collected from municipal policyholders but haven't recognized as revenue or paid in claims - plus a $3 billion fee. In essence, Berkshire is asking for a premium payment equal to 150% of unearned premium reserves - a price that Berkshire reinsurance chief Ajit Jain acknowledges, in a letter to one insurer, could appear to be "excessive."

But Jain goes on to argue that with the bond insurers scrambling to hold onto their triple-A ratings, even an expensive deal with Berkshire is well worth their while. "I would submit that our proposal at the pricing levels we require is actually a cheap way for MBIA to raise capital as compared to other alternatives," Jain wrote in a letter last week to MBIA banker Lazard, "and is therefore of great benefit to MBIA's owners and their municipal policyholders."

So far, though, MBIA's owners aren't seeing the benefit. Shares of the company slid 11% in early afternoon trading, and investors said they're skeptical that MBIA or Ambac would agree to the terms Buffett laid out. Buffett's letter says Berkshire approached three insurers and has been turned down by one. As of this morning, Berkshire says it hadn't heard from the other two.

Rob Haines, who covers the insurance industry for independent research shop CreditSights, says he believes MBIA (MBI) - which has raised more than $2 billion this year in new capital - is the one that turned Buffett down. "MBIA is trying to position itself as a survivor," Haines says, "so I can't see them as attracted to this." Calls to MBIA, Ambac and FGIC weren't immediately returned. Lazard had no comment. On Tuesday after market close, Ambac issued a staetment indicating that it would seek another route.

But Haines and others doubt the monolines will be willing to give up the one business they have that is doing well. "Doing this deal would be a clear white flag that [the monoline insurers] are entering run-off," adds Haines, referring to the state in which insurers stop writing new policies. Given the steep declines in values of so-called structured credit products, the muni business is "their only real franchise remaining," says Haines.

Other investors who follow the monolines shrugged off Buffett's offer as well. The proposal "is not a great surprise," says Andrew Moloff, chief investment officer at Ambac shareholder Evercore Asset Management in New York. Evercore last month sent a letter to Ambac urging the company not to dilute current shareholders by selling stock at depressed prices to raise capital in a bid to hold onto its triple-A credit rating. Talks between the insurers and Buffett have been reported over the past few months, but no transaction has taken place because Buffett "wants a very high price" for a deal that the monolines would probably prefer not to do, Moloff says.

Moloff notes that Buffett likes the municipal bond business because it is profitable and bears little risk of default. A reinsurance deal thus appeals to Buffett - but presumably not to managers of Ambac (ABK) and MBIA, because it would effectively strip the insurers of their best business and leave them with fewer resources to deal with possible losses on their risky credit derivatives portfolios.

CreditSights' Haines takes issue with Buffett's argument that the deal would free up capital held against the monolines' massive municipal obligations. In terms of insured deals, "Ambac has $300 billion alone as of Sept. 30," he notes. "Munis don't require a lot of capital to be held in reserve," he adds, "so the loss of that earnings stream would hurt capital in the short-term."

But Whitney Tilson, a partner at investment management firm T2 Advisors who is short MBIA and Ambac (betting on their shares' decline) believes Buffett is "playing to a larger audience." He believes regulators are eager to prevent widespread downgrades of municipal bonds, which could saddle municipalities with higher interest costs and lead down the road to higher taxes. He calls Buffett's proposal "potentially great for the markets and the financial system," because real risks and liabilities would be covered by Berkshire (BRKA, Fortune 500), whose triple-A credit rating - in contrast to Ambac and MBIA - is not under review. He adds, speaking of MBIA and Ambac, "This is just as obviously terrible for their shareholders."

And of course, that's the beauty of the deal - if it happens - for Buffett: Anything that's bad for one set of shareholders is likely to be good for another. "You can bet that Warren can meet his return-on-equity target with this deal," says David Merkel, chief economist and director of research at broker-dealer Finacorp Securities. Referring to Buffett's refusal to pursue deals that might dent Berkshire's profitability, Merkel added: "He never pays up."

CNN

U.K. Unemployment Falls for a 16th Month to Three-Decade Low

U.K. Unemployment Falls for a 16th Month to Three-Decade Low

Feb. 13 (Bloomberg) -- U.K. unemployment fell for a 16th month to a three-decade low in January as economic growth led companies to add workers.

Claims for jobless benefits dropped 10,800 from December to 794,600, the lowest since June 1975, the Office for National Statistics said today in London. The drop was more than double the 5,000 median forecast in a Bloomberg News survey of 28 economists. The jobless rate stayed at 2.5 percent.

Economists expect job creation to falter this year as the economy slows from its fastest expansion since 2004. The Bank of England cut interest rates this month to shield the economy after a jump in credit costs. The central bank will publish new forecasts for growth and inflation today.

``The labor market still looks firm,'' said George Johns, an economist at Barclays Capital in London, before the report. ``We're seeing the lagged effects of a strong economy, but as growth slows we'll see claims pick up. That will be gradual, so the bank won't be aggressive with rate cuts.''

Growth may slow to 2 percent this year from 3.1 percent in 2007, the central bank predicted in November. The economy grew 0.6 percent in the fourth quarter, the weakest pace in more than a year.

The Bank of England will update its forecasts at 10:30 a.m. in London when Governor Mervyn King presents the quarterly inflation report.

A deteriorating economic outlook may make it harder for workers to demand higher pay to compensate for rising food and energy bills.

Average Earnings

Average earnings including bonuses rose an annual 3.8 percent in the three months through December, down from a 4 percent pace in November, the statistics office said today. Without bonuses, wage growth quickened to 3.7 percent from 3.6 percent.

``The bank's clearly a bit worried about pay, but the economy won't grow fast enough to sustain the number of workers,'' said Alan Clarke, an economist at BNP Paribas SA in London. ``Unemployment should go up.''

Economic growth will slow to 1.8 percent this year, matching the worst performance since 1992, and jobless claims will reach 910,000, according to the average of independent forecasts compiled by the Treasury last month.

British Airways Plc, Europe's third-biggest carrier, is cutting jobs to increase profits. Scottish & Newcastle Plc, the U.K.'s largest beermaker, said Feb. 12 it plans to close a southern England brewery to cut costs, putting 362 jobs at risk.

Housing Slump

Fewer jobs may drain consumer demand as house prices fall. The U.K. housing slump deepened in January to the worst since the British economy emerged from its last recession in 1992, the Royal Institution of Chartered Surveyors said in a separate report today.

The unemployment rate as measured by International Labor Organization standards fell to 5.2 percent in the quarter through December, the lowest since the three months ended January 2006.

The rate compares with 7.2 percent in the 13-nation euro region, 4.9 percent in the U.S. and 3.8 percent in Japan. The number of unemployed fell 61,000, the biggest drop since January 2003. It stood at 1.6 million, the lowest since March 2006.

Employment rose 175,000 in the fourth quarter, the most in more than a decade, to a record 29.4 million, the statistics office said today.

The 16 straight monthly declines in jobless claims is the longest stretch since the 20 months through January 2005, the statistics office said. In December, claims fell 8,700 rather than the 6,400 estimated last month.

The central bank lowered the rate to 5.25 percent this month, the second reduction in three months. Economists expect the main rate to reach 4.5 percent by the end of the year, according to the median of 44 economists in a Bloomberg survey on Feb. 1.

BLOOMBERG

U.S. Retail Sales Probably Fell in January for a Second Month

U.S. Retail Sales Probably Fell in January for a Second Month

Feb. 13 (Bloomberg) -- Retail sales in the U.S. probably fell in January for a second month as falling home prices discouraged consumer spending, a sign the biggest part of the economy is starting to falter, economists said before a government report today.

Sales dropped 0.3 percent after falling 0.4 percent in December, according to the median estimate in a Bloomberg News survey of 81 economists. It would be the first back-to-back decline since 2003.

Americans are spending less on cars and furniture as the real-estate slump erodes the value of their homes, adding to concern that sustained declines in consumer purchases will end the economic expansion. Federal Reserve Chairman Ben S. Bernanke will likely cut interest rates further as risks to growth escalate, economists said.

``Consumer spending continues to lose momentum,'' said Brian Bethune, an economist at Global Insight Inc. in Lexington, Massachusetts. The figures ``reinforce the picture of an economy that has run of out steam in the early months of 2008.''

The Commerce Department will report retail sales at 8:30 a.m. in Washington today. Economists' forecasts ranged from a decline of 1.2 percent to a gain of 0.3 percent.

Business Inventories

At 10 a.m., Commerce will report that businesses' inventories grew 0.5 percent in December as sales declined, according to the Bloomberg survey median. The increase, following a 0.4 percent gain in November, raises the possibility merchants will place fewer orders as demand slows.

Consumers, whose spending accounts for more than two-thirds of the economy, are facing the worst housing slump in a quarter century at the same time that access to credit is becoming more difficult. The economy lost 17,000 jobs in January, the first drop in more than four years. The Standard & Poor's 500 Index has fallen three consecutive months, the longest losing streak since 2003.

Auto dealers are among retailers taking a hit. Cars and light trucks sold last month at a 15.2 million annual pace, down 6.7 percent from December. Auto industry sales this year are forecast to drop to the lowest level since 1998.

AutoNation Inc., the largest publicly traded U.S. car dealer, said fourth-quarter profit dropped to a six-year low as cooling economies in California and Florida, two states bearing the brunt of the housing slump, hurt sales.

`Brutal'

``The first half of the year will be brutal,'' Chief Executive Officer Michael Jackson said in a Feb. 7 interview.

The retail report may show purchases excluding automobiles rose 0.2 percent in January, after a 0.4 percent drop in December, according to the Bloomberg median. An increase in receipts at service stations because of higher gasoline prices probably contributed to the gain, economists said.

Industry reports showed January sales fell at stores from Target Corp. to Nordstrom Inc. even as some retailers slashed prices by as much as 75 percent. Sales at stores open at least a year rose 0.5 percent from a year earlier, the worst January since 1970, according to the International Council of Shopping Centers.

The industry figures account for about 17 percent of total retail sales, which make up almost half of consumer spending. Retailers' January results followed the worst holiday shopping season since 2002, according to ICSC.

Consumers are increasingly limiting expenses to those they can't avoid. The amount Americans must spend each month on debt service, housing, medical costs, and food and energy bills rose to 66.9 percent of their total spending in December, the highest since records began in 1980, according to Bloomberg figures.

A U.S. recession over the next 12 months is now an even bet, according to a Bloomberg survey of economists taken from Jan. 30 to Feb. 7. The odds of a recession rose from 40 percent in January.

BLOOMBERG

ΕΛΛΑΔΑ: «Παγώνει» η χώρα λόγω της απεργίας για το ασφαλιστικό

«Παγώνει» η χώρα λόγω της απεργίας για το ασφαλιστικό

«ΠΑΓΩΝΕΙ» σήμερα η οικονομική και κοινωνική ζωή της χώρας λόγω της 24ωρης απεργίας των συνδικάτων που διαμαρτύρονται για την ασφαλιστική μεταρρύθμιση που προωθεί η κυβέρνηση η οποία περιλαμβάνει δυσμενείς αλλαγές στα όρια ηλικίας συνταξιοδότησης, μειώσεις των συντάξεων και ενοποίηση των υγιών ασφαλιστικών ταμείων.

Οπως επισημαίνουν εκπρόσωποι των συνδικαλιστικών οργανώσεων η κυβέρνηση θα βρεθεί αντιμέτωπη με το σύνολο των εργαζομένων στο δημόσιο και ιδιωτικό τομέα καθώς και των δικηγόρων, γιατρών, φαρμακοποιών, μηχανικών και δημοσιογράφων που αντιδρούν στην ενοποίηση των Ταμείων τους για να καλυφθούν τα ελλείμματα των υπόλοιπων.

Παράλληλα με την απεργιακή κινητοποίηση όλοι οι εργαζόμενοι ζητούν από την κυβέρνηση υπαναχώρηση στην ασφαλιστική μεταρρύθμιση που προωθεί επειδή με αυτή δεν δίνεται προοπτική στο σύστημα κοινωνικής ασφάλειας, απλά το μόνο που επιτυγχάνεται είναι η φαλκίδευση των ασφαλιστικών δικαιωμάτων τους.

Τα συνδικάτα κάλεσαν τους πολίτες να συμμετάσχουν μαζικά στη σημερινή απεργιακή συγκέντρωση στις 11 το πρωί στο Πεδίο του Αρεως και στην πορεία προς τη Βουλή που θα ακολουθήσει στη συνέχεια.

Στην 24ωρη πανελλαδική απεργία που πραγματοποιεί σήμερα η ΓΣΕΕ και η ΑΔΕΔΥ θα απεργήσει το σύνολο του ιδιωτικού και δημόσιου τομέα, ενώ συμμετέχουν οι Ομοσπονδίες εργαζομένων στις ΔΕΚΟ (ΟΤΕ, ΔΕΗ, ΕΛΤΑ, ΕΥΔΑΠ [EYDr.AT] ), οι Τραπεζοϋπάλληλοι ΟΤΟΕ , δάσκαλοι και καθηγητές, νοσοκομειακοί γιατροί ΟΕΝΓΕ , ιατρικοί επισκέπτες και νοσηλευτικό προσωπικό, οι εργαζόμενοι στο ΕΚΑΒ, σε δημόσιες υπηρεσίες και ταμεία, στους ΟΤΑ, σε πλοία και λιμάνια, οι εργαζόμενοι στις αστικές συγκοινωνίες (λεωφορεία, τρόλεϊ ηλεκτρικός σιδηρόδρομος, μετρό).

Λόγω της συμμετοχής στην απεργία των εργαζομένων στα ΜΜΕ σήμερα δεν θα μεταδοθούν ραδιοφωνικές και τηλεοπτικές εκπομπές, ενώ αύριο Πέμπτη δεν θα εκδοθούν εφημερίδες. Επιπλέον οι μηχανικοί του δημοσίου τομέα θα πραγματοποιήσουν νέα 24ωρη απεργία την Παρασκευή 15 του μηνός και θα συμμετέχουν στη συγκέντρωση έξω από τη Βουλή την ώρα που ο πρωθυπουργός θα εξαγγείλει την ασφαλιστική μεταρρύθμιση.

Σήμερα θα λειτουργήσουν με προσωπικό ασφαλείας τα δημόσια νοσοκομεία, το ΕΚΑΒ όπως και όλα τα Κέντρα Υγείας και τα θεραπευτήρια, λόγω της συμμετοχής των εργαζομένων στην απεργία, ενώ προβλήματα θα υπάρχουν και στις μετακινήσεις με τα ΜΜΜ, αλλά και με Ι.Χ. στο κέντρο της Αθήνας το οποίο θα κλείσει από τις 10 το πρωί λόγω του συλλαλητηρίου που έχει προγραμματιστεί για τις 11 το πρωί στο Πεδίο του Αρεως.

Νομαρχία Αθηνών

Εξάλλου σήμερα, δεν θα πραγματοποιηθούν οι θεωρητικές και πρακτικές εξετάσεις υποψηφίων οδηγών (δικύκλων και αυτοκίνητων) για την περιοχή ευθύνης της Νομαρχίας Αθηνών. Οι υποψήφιοι που είχαν προγραμματίσει για σήμερα τις εξετάσεις τους, μπορούν να τις προγραμματίσουν για τις επόμενες ημέρες, ύστερα από συνεννόηση με τις κατά τόπους Διευθύνσεις Μεταφορών της Νομαρχίας Αθηνών.

Επίσης, όσα οχήματα είχαν προγραμματισθεί την Τετάρτη 13/02/2008, να περάσουν από Τεχνικό Έλεγχο στα ΚΤΕΟ της Νομαρχίας Αθηνών, μπορούν να προσέρχονται σε αυτά μέχρι την Παρασκευή 22 Φεβρουαρίου 2008.

Τέλος, η ισχύς των Δελτίων Τεχνικού Ελέγχου που λήγει την 13η Φεβρουαρίου 2008, παρατείνεται μέχρι την Παρασκευή 22 Φεβρουαρίου 2008.

Τα μέσα μεταφοράς

Τα μέσα μαζικής μεταφοράς θα λειτουργήσουν ως εξής:

- ΜΕΤΡΟ - ΗΛΕΚΤΡΙΚΟΣ πραγματοποιούν στάση εργασίας από έναρξη βάρδιας έως 10:00 π.μ και από 16:00μ.μ. έως λήξη της βάρδιας (δηλ. ώρες λειτουργίας από 10:00 - 16:00) για τη διευκόλυνση των απεργών στην προσέλευσή τους στο Συλλαλητήριο.

- ΤΡΟΛΕΪ στάση εργασίας από 11:00 έως 16:00. Οι εργαζόμενοι στα λοιπά μέσα μεταφοράς απεργούν. Επίσης θα πραγματοποιηθεί μόνο ένα δρομολόγιο του προαστιακού Σιδηροδρόμου στις 11.38 στη διαδρομή Πειραιάς - Κιάτο και στις 19.14 Κιάτο - Πειραιάς.

Τέλος, λόγω της απεργίας των ελεγκτών εναέριας κυκλοφορίας δεν θα πετάξει κανένα αεροπλάνο από και προς κανένα αεροδρόμιο, ενώ οι λεωφορειακές γραμμές εxpress που εξυπηρετούν το αεροδρόμιο θα συμμετέχουν στην απεργία από ώρα 04.25 έως στις 24.00 που λήγει η βάρδια τους.

NAFTEMPORIKI

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Τράπεζες: Απομακρύνονται οι κίνδυνοι για την ρευστότητα τους

Τράπεζες: Απομακρύνονται οι κίνδυνοι για την ρευστότητα τους

Η σημαντική αύξηση των καταθέσεων που εμφανίζουν οι τράπεζες αλλά και οι εναλλακτικές πηγές άντλησης κεφαλαίων απομακρύνουν τους κινδύνους για την ρευστότητα τους. Οι τράπεζες το 2008 αναμένεται να αντλήσουν συνολικά 14 δις ευρώ περίπου ενώ και οι ενδείξεις για τις καταθέσεις είναι ενθαρρυντικές παρά την αύξηση των εξόδων από τόκους λόγω των αυξημένων επιτοκίων στους προθεσμιακούς λογαριασμούς. Η Eurobank μέσα στο 2008 θα αντλήσει περίπου 3 με 4 δις ευρώ μέσω τιτλοποίησης δανείων αλλά και καλλυμένων ομολογιών.

Η Alpha bank σχεδιάζει να ενισχύσει την ρευστότητα της κατά 4 δις ευρώ.

Αξιόπιστη πηγή αναφέρει ότι τα 4 δις ευρώ θα αντληθούν μέσω τιτλοποιήσεων και καλλυμένων ομολογιών.

Συγκεκριμένα 2 δις ευρώ θα αφορούν τιτλοποιήσεις.

Την 3η μεγαλύτερη άντληση ρευστότηταςμέσα στο 2008 θα πραγματοποιήσει η Πειραιώς η οποία σύμφωνα με την διοίκηση θα είναι της τάξης των 2,5 δις ευρώ και θα προέλθει μέσω τιτλοποίησης και καλλυμένων ομολογιών και κοινών ομολογιακών δανείων.

Θα πρέπει να σημειωθεί ότι η Πειραιώς έχει ήδη αντλήσει 2,1 δις ευρώ και συγκεκριμένα 1,3 δις ευρώ από τιτλοποίηση και 800 εκατ από ομολογιακές εκδόσεις.

H Emporiki bank έχει αντλήσει συνολικά 1,8 δις ευρώ μέσα στο 2007 και για το 2008 θα προβεί σε ενίσχυση της ρευστότητας της κατά 1,5 με 2 δις ευρώ και θα αφορούν κοινά ομολογιακά δάνεια και ενδεχομένως τιτλοποιήσεις.

Η Εθνική τράπεζα για το 2008 δεν σχεδιάζεται κάποιο πρόγραμμα αλλά αν προβεί μάλλον θα το πραγματοποιήσει στο β΄ 6μηνο του 2008δεν θα υπερβαίνει τα 500 με 700 εκατ ευρώ.

Η ATE Bank πέραν της τιτλοποίησης των μη εξυπηρετούμενων δανείων ύψους 500 εκατ ευρώ δεν σχεδιάζει άλλη έκδοση πλην ενδεχομένως καλυμμένων ομολογιών.

REPORTER.GR

ArcelorMittal Profit Rises 2.7% as Shipments Increase

ArcelorMittal Profit Rises 2.7% as Shipments Increase

Feb. 13 (Bloomberg) -- ArcelorMittal, the world's largest steelmaker, said fourth-quarter profit rose 2.7 percent on higher prices and expanded Latin American production.

Net income climbed to $2.44 billion, or $1.71 a share, from $2.37 billion, or $1.71, a year earlier, Luxembourg-based ArcelorMittal said today in a statement. That beat the $2.39 billion median estimate of seven analysts surveyed by Bloomberg News. Sales increased 21 percent to $28 billion with shipments up almost 5 percent to 28 million metric tons.

Chief Executive Officer Lakshmi Mittal got approval in December to take full control of Acindar Industria Argentina de Aceros SA, part of the company's plan to expand in emerging economies. ArcelorMittal is focusing on developing nations as economic growth slows in the U.S., where it raised prices during the quarter because of raw-material and transport costs.

``They've got massive increases in costs coming up and significant increases in their prices,'' said Alan Coats, an analyst at HSBC Bank Plc in London who has an ``overweight'' rating on the company. ``From that storm, the question is what sort of profits will be made.''

First-quarter profit before interest, taxes, depreciation and amortization will be $4.7 billion to $5 billion, up from $4.3 billion a year earlier, ArcelorMittal said. The annual rate of $18.8 billion to $20 billion would fall short of HSBC's estimate of $24.8 billion.

ArcelorMittal rose 2.98 euros, or 6.5 percent, to 49.17 euros in Amsterdam yesterday. The stock has increased 36 percent in the past 12 months, valuing the company at 71.2 billion euros ($104 billion).

Steel Prices Gain

European prices for hot-rolled steel gained 13 percent in the fourth quarter from a year earlier, according to Metal Bulletin data. ArcelorMittal raised U.S. prices by $40 a metric ton from Jan. 1, double its average fourth-quarter increase of $20. Global steel output may fall short of demand this year by 55 million tons as China reduces exports, Credit Suisse Group estimated in a Feb. 11 report.

``Any further structural positives in China's supply and demand balance could leave steel supply well below demand levels even with ongoing weakness in Europe and the U.S.,'' Credit Suisse London-based analysts including Michael Schillaker said in the report.

ArcelorMittal produces 10 percent of the world's steel. The company was formed last year through the $38.3 billion merger of Mittal Steel Co. and Arcelor SA.

``In 2007, we announced 35 acquisitions, all of which serve to strengthen ArcelorMittal's global steel offering,'' Mittal said in the statement.

Iron-Ore Record

Iron ore and coal have risen to records as steel demand surged in China and other emerging economies. The benchmark price for iron ore, which has tripled in five years, may rise 50 percent in 2008, according to Macquarie Group Ltd. Steel demand is expected to grow about 6 percent in 2008, ArcelorMittal said in November.

In addition to regulatory approval for the full acquisition of Acindar, Argentina's second-largest steelmaker, ArcelorMittal last year purchased the Sicartsa steel mill in Mexico in April and Arcelor Brasil SA in Brazil in May.

Year-earlier net income was calculated by ArcelorMittal as if the company existed at the time.

(ArcelorMittal executives will discuss earnings at 10:30 a.m. London time. To listen, go to the company's Web site at http://www.arcelormittal.com .)

BLOOMBERG

Rio Tinto 2nd-Half Net Rises 11% on Iron Ore, Alcan

Rio Tinto 2nd-Half Net Rises 11% on Iron Ore, Alcan

Feb. 13 (Bloomberg) -- Rio Tinto Group, the target of a $138 billion hostile bid from BHP Billiton Ltd., said second- half profit rose 11 percent on record iron-ore production and its acquisition of Alcan Inc.

Net income in the six months ended Dec. 31 climbed to $4.06 billion, from $3.64 billion a year earlier. The earnings were calculated by subtracting first-half profit from full-year figures published today in an e-mailed statement. Profit beat the $3.99 billion median of eight analyst estimates compiled by Bloomberg.

`` It looks as if they have been able to contain costs fairly well,'' Ken West, who helps manage A$3 billion at Perennial Investment Partners Ltd., said today by telephone from Melbourne. ``Next year they will be very strong.''

The gain will support Chief Executive Officer Tom Albanese as he tries to keep Rio independent and bolster his argument that the company has better growth prospects than BHP over the next five years. Rising labor, fuel and shipping costs have squeezed mining companies' margins.

Rio's profit follows the unexpected 2.4 percent decline in earnings reported last week by BHP Billiton, the world's largest mining company.

``With supply side constraints across the mining industry unlikely to ease in the near future, commodity prices are expected to stay high by historic standards,'' Chairman Paul Skinner said in the statement.

Iron-Ore Record

Iron-ore production, which accounted for 27 percent of Rio's sales in 2006, increased to a record 145 million metric tons in 2007, the company reported Jan. 16. Iron-ore prices rose by 9.5 percent in last year's annual contracts with steelmakers.

Rio, the second-largest iron-ore exporter, last month completed a $1.4 billion expansion of Dampier Port in Western Australia, lifting the port's iron-ore capacity 90 percent. Rio's annual output may eventually triple to 600 million tons, it said in November, two weeks after BHP made its approach.

Rio completed the acquisition of Montreal-based Alcan in November, boosting its production of aluminum.

Full-year net income dropped 1.7 percent to $7.3 billion. Sales rose 32 percent to $33.5 billion. Rio increased its full- year dividend 31 percent to 84 cents a share.

Offer Rejected

Rio climbed 81 cents, or 0.6 percent, to A$128.61 at the close in Sydney trading, before the earnings were published. The London shares have more than doubled in the past year, compared with a 48 percent advance in Melbourne-based BHP's U.K. stock. Anglo American Plc, the second-largest mining company, has increased 21 percent.

Rio rejected an increased all-share offer from BHP on Feb. 6 as too low. BHP improved its bid to 3.4 shares for every one of Rio's four days after Beijing-based Aluminum Corp. of China and Alcoa Inc. of New York bought a 9 percent stake in Rio on Feb. 1 for $14 billion.

BHP wants to combine its Western Australian iron-ore operations with Rio's to challenge Rio de Janeiro-based Cia. Vale do Rio Doce as the world's biggest supplier of the raw material. The combination would be ``without comparison in the natural resources industry,'' BHP Chairman Don Argus told shareholders in a letter dated Feb. 7.

BLOOMBERG

Ανεβαίνει ο πήχης για εξαγορά της Yahoo

Ανεβαίνει ο πήχης για εξαγορά της Yahoo

ΦΟΥΝΤΩΝΕΙ ο πόλεμος μεταξύ Yahoo! και Microsoft με τη Yahoo! να απορρίπτει την προσφορά της Microsoft -χαρακτηρίζοντάς τη πολύ χαμηλή - αναγκάζοντας την αμερικανική εταιρεία λογισμικού είτε να ανεβάσει τον πήχη είτε να υιοθετήσει μια επιθετική προσέγγιση για την επίτευξη συμφωνίας.

Από την πλευρά της, η Microsoft χαρακτήρισε την προσφορά της δίκαιη και πλήρη, δεν απέκλεισε όμως το ενδεχόμενο να προσφέρει περισσότερα. Η αμερικανική εταιρεία λογισμικού σε ανακοίνωσή της τονίζει ότι έχει το δικαίωμα να προχωρήσει σε όλα τα αναγκαία βήματα, χωρίς όμως να προσδιορίζει εάν σχεδιάζει την παρουσία της προσφορά της κατευθείαν προς τους μετόχους της Yahoo!.

Παρ' όλα αυτά, αρκετοί αναλυτές εκτιμούν ότι η Microsoft θα προσφέρει περισσότερα -με την αρχική της προσφορά στα 31 δολάρια ανά μετοχή- χωρίς να αποκλείουν το ενδεχόμενο ο «πήχης» να φθάσει μέχρι και τα σαράντα δολάρια ανά μετοχή.

Η Microsoft επιδιώκει την ολοκλήρωση της μεγαλύτερης συγχώνευσης του τεχνολογικού τομέα, σε μια θαρραλέα στρατηγική κίνηση, η οποία αποσκοπεί στη δημιουργία ενός κραταιού ανταγωνιστή για τη μηχανή online αναζήτησης Google

Η Yahoo! ανακοίνωσε ότι η προσφορά δεν αποτιμά πλήρως τους 500 εκατ. χρήστες που διαθέτει ανά τον κόσμο, ούτε τις επενδύσεις σε online διαφημιστική πλατφόρμα, όπως και τις δυνατότητές της στη συγκέντρωση μετρητών.

Την ίδια στιγμή, η Yahoo! «εκτόπισε» την Google από τη θέση του προτιμώμενου provider υπηρεσιών Διαδικτύου σε Βόρεια και Κεντρική Ευρώπη, βάζοντας στη θέση της την T-Mobile. Mέσω της συμφωνίας, η Yahoo! αποκτά πρόσβαση στους 90 εκατ. συνδρομητές κινητής τηλεφωνίας της T-Mobile. Παρά την αβεβαιότητα εξαιτίας των κινήσεων της Microsoft, τα σχέδια της Yahoo! για μεγαλύτερη «διείσδυση» στην κινητή τηλεφωνία παραμένουν ανεπηρέαστα.

Από την άλλη πλευρά, η Nokia θα προσθέσει την Google στη λίστα μηχανών αναζήτησης, στις οποίες έχουν πρόσβαση οι καταναλωτές μέσω κινητών. Η Nokia έχει συνάψει παρόμοιες συμφωνίες με Yahoo! και Microsoft, όπως και με την Baidu στην Κίνα και τη Yandex στη Ρωσία.

NAFTEMPORIKI