U.S. Steel curbing production in Alabama, Texas
U.S. Steel has issued notices to 1,918 workers at its tubular plants in Birmingham, Ala., and Lone Star, Texas, that it will temporarily curb production at the mills. The Pittsburgh steel producer blamed softening conditions in the energy business caused by falling oil prices. U.S. Steel said it issued the notices under federal regulations that require companies to give workers 60-day notice of plant closings and mass layoffs. The company emphasized that trimming production is a temporary adjustment and that it is not idling either plant.
Heinz plans to raise $2 billion to repay loans
H.J. Heinz Co., the Pittsburgh ketchup-maker owned by Warren Buffett’s Berkshire Hathaway Inc. and 3G Capital Inc., is planning to raise $2 billion to repay a portion of its term loans, the company said in a statement. Heinz, which Berkshire and 3G bought for $23 billion in June 2013, intends to issue second-lien senior notes maturing in 2025. Second-lien debt is secured by the same assets that back higher-ranked first-lien debt. In case of default, the second-lien lenders stand behind first-lien investors in terms of right to collect proceeds. Heinz has $9.33 billion of loans, according to data compiled by Bloomberg.
Mattel CEO resigns as toy maker’s net income falls
Mattel Chairman and CEO Bryan Stockton has resigned after the struggling maker of Barbie dolls and Hot Wheels cars reported fourth-quarter results that fell far short of analyst expectations. The El Segundo, Calif., company said board member Christopher A. Sinclair will replace Mr. Stockton as chairman and interim CEO. Mattel said net income tumbled 59 percent to $149.9 million from $369.2 million in the three months that ended Dec. 31. On a per-share basis, Mattel earned 44 cents per share in the most recent quarter, or 52 cents per share not counting hits from taxes and costs tied to its acquisition of Mega Bloks owner Mega Brands. Revenue fell 6 percent to $1.99 billion partially due to foreign exchange rates. Analysts forecast, on average, earnings of 91 cents per share on $2.14 billion in revenue, according to the data firm FactSet.
IBM dismisses report of massive layoffs
IBM dismissed on Monday a Forbes magazine report claiming the technology firm is preparing to cut about 26 percent of its workforce. IBM is cutting jobs, as disclosed in its latest earnings report last week, but those reductions will affect “several thousand” employees, a “small fraction” of what Forbes reported, according to an emailed statement from IBM to Reuters. Forbes had said as many as 112,000 employees could be laid off.
Aer Lingus confirms new takeover bid by IAG
Aer Lingus announced Monday that British Airways parent IAG has made an improved takeover offer of 2.55 euros ($2.85) per share, and the board of the Irish airline says it is considering the proposal. The offer — the third by IAG in the past month — values Aer Lingus at more than 1.3 billion euros ($1.45 billion). Unlike previous offers, the Aer Lingus board did not reject this offer outright.
First Published: January 27, 2015, 5:00 a.m.
