Midday Business Report: Black & Veatch unit gains piece of Afghan contract
By DAVID HAYES
The Kansas City Star
A Black & Veatch unit is part of a joint venture that has won a $1.4 billion contract to rebuild roads, power lines and water supply systems in Afghanistan.
A joint venture between Overland Park-based Black & Veatch Special Projects Corp. and New Jersey-based Louis Berger Group will rebuild infrastructure in the war-torn country.
The joint venture team was selected by the United States Agency for International Development for the five-year project.
¡°In working with USAID to make power and water supplies more reliable, and by improving the roads that allow effective trade, we can help create the conditions for stronger industry, commerce and economic independence in Afghanistan,¡± said Joe McGonagle, president of Black & Veatch Special Projects.
The team initially will work to rebuild power lines and power plants, and rebuild and extend roads. Later, the two companies said, work will focus on water and sewer projects and public building improvements.
The contract calls for the joint venture to bring in Afghan firms, working as mentors, said George Minter, a spokesman for Black & Veatch. The arrangement will allow companies in that country to oversee the infrastructure improvements long term.
It will be Black & Veatch¡¯s first contract in Afghanistan. The company has infrastructure reconstruction contracts in Iraq.
The Louis Berger Group is finishing up a five-year Afghanistan project focused on road reconstruction and extension.
The new venture is a 50-50 partnership between the two engineering firms, Minter said.
Black & Veatch is privately held, and has more than 7,740 employees worldwide, including 3,340 in the Kansas City area.
Sprint adds mobile security services
Sprint today launched a new security service designed to protect business information stored on laptop computers and PDAs.
Sprint Mobile Security allows companies to password protect and encrypt information on mobile devices, scan for viruses and delete information on a device, and to ensure that only ¡°corporate sanctioned¡± applications are run on the laptop or device.
Mobile security is becoming key for many businesses, which are seeing more employees working remotely on laptops or PDAs that can access corporate networks.
¡°Companies can have confidence knowing that their assets are secure and proprietary data is protected and compliant with corporate policy,¡± said Barry Tishgart, director of product marketing for Sprint.
To reach David Hayes, call (816) 234-4904 or send e-mail to dhayes@kcstar.com.
Sprint wins diversity award
Sprint today received a perfect score from the Human Rights Campaign for its treatment of gay, lesbian, bisexual and transgender employees, consumers and investors.
The HRC¡¯s annual Corporate Equality Index ranked more than 400 U.S. companies. Sprint received perfect marks for the second consecutive year.
¡°By ensuring that we¡¯ve approached all aspects of our business with an inclusive mindset, we¡¯re able to market to a broad range of customers and attract and retain a creative workforce with a diverse set of backgrounds and ideas,¡± said Ralph Reid, vice president of Corporate Social Responsibility for Sprint.
To reach David Hayes, call (816) 234-4904 or send e-mail to dhayes@kcstar.com.
STAR BUSINESS ROUNDUP
Motorola to buy Symbol Technologies for $3.9 billion
Motorola Inc. today said it will acquire Symbol Technologies Inc. for about $3.9 billion in a deal that expands the world¡¯s second-largest cell phone maker¡¯s presence in the market for business-oriented mobile devices.
The deal for Symbol, which makes portable bar-code scanners and customized handheld computers, is expected to close in late 2006 or early 2007, pending regulator clearance and approval by Symbol shareholders, company officials said.
¡°This is a company we¡¯ve been looking at for some time,¡± Motorola Chairman and Chief Executive Ed Zander said in a conference call from Symbol¡¯s headquarters in Holtsville, N.Y. ¡°We really had our hearts set on adding lots of critical mass and critical size inside the enterprise area and today we do that.¡±
Symbol also produces mobile devices for rugged business environments, as well as equipment based on the emerging wireless technology known as RFID, or radio frequency identification, which is used for inventory tracking and other purposes.
Motorola intends for Symbol to become the ¡°cornerstone¡± of the company¡¯s enterprise mobility business, said Symbol president and CEO Sal Iannuzzi. Symbol has about 5,200 workers, and in 2005 reported earnings of $32.3 million on sales of $1.77 billion.
The deal is Motorola¡¯s largest since its $17 billion acquisition of cable TV box-maker General Instrument Corp. in 2000.
Layne Christensen to buy American Water¡¯s sewer-repair unit
Layne Christensen Co., a provider of services to the construction, energy and utility sectors, today said it has signed a nonbinding deal to buy a unit of American Water that services sewer lines.
Financial terms were not disclosed.
Layne, based in Mission Woods, said it expects to close the purchase of Underground Infrastructure Group by Nov. 15. The unit provides cured in place pipe services in the United States. The process is used to repair sewer lines instead of replacing them.
Layne said the acquisition will make it the second-largest provider of cured in place pipe services in the country.
American Water is a major U.S. water works, owned by energy giant RWE AG of Germany.
In midday trading on the Nasdaq, Layne shares were up 2 cents at $28.89. Shares have traded in a 52-week range of $19.95 to $33.93.
Ford to pay director $25,000 a day as consultant
Ford Motor Co. will pay director John Bond $25,000 a day to be a consultant to Chairman William Clay Ford Jr. at a time when the auto maker is going through a massive restructuring.
Bond¡¯s total fees under the consulting deal are capped at $262,500 every 12 months, according to the auto maker¡¯s filing Monday with the Securities and Exchange Commission.
The company said it expected Bond to act as Chairman Ford¡¯s consultant for about a day and a half near each of the seven regularly scheduled board meetings it holds every year.
Bond was chief executive and chairman at HSBC Holdings PLC and his international banking experience ¡°can benefit the company at a critical time,¡± spokesman Tom Hoyt. Bond also is nonexecutive at Vodafone Group PLC.
His role will differ from that of director Carl Reichardt, who was tapped by Ford to be vice chairman from 2001 to 2003. Reichardt, who was chairman and chief executive of Wells Fargo & Co., took on a larger role when Bill Ford assumed the chief executive position in 2001.
Reichardt was a full-time employee while Bond is not, Hoyt said. Bond will advise Ford and senior management before regularly scheduled board meetings.
¡°Certainly someone with Mr. Bond¡¯s experience is helpful in any financial discussion,¡± Hoyt said.
Also in the filing, Ford said that it would eliminate the position of chief operating officer. Anne Stevens held the position until Ford announced her retirement Thursday.
Chrysler cuts third-quarter shipment forecast
DaimlerChrysler AG¡¯s Chrysler Group will cut deliveries to dealers by 90,000 vehicles in the third quarter, as falling sales of trucks and SUVs have left it with bloated inventories, DaimlerChrysler Chairman Dieter Zetsche said today.
For the entire second half of the year, Chrysler plans to bring retail shipments down by 135,000 units from its previous target. It has also scaled back production for the rest of the year.
Zetsche¡¯s remarks in a Web cast from DaimlerChrysler¡¯s headquarters in Stuttgart, Germany, came four days after the company said Chrysler¡¯s third-quarter loss would be $1.52 billion ¡ª more than twice what it had previously anticipated.
Zetsche said the company was forced to make the dramatic cuts after dismal sales this summer.
Zetsche said Chrysler was hit hard by the consumer shift away from gas-guzzling sport utility vehicles and pickups. Trucks account for 71 percent of Chrysler¡¯s sales, he said. Most of the inventory reduction will come in that segment, he said.
Tainted spinach leads to calls for more oversight
Leafy vegetables are the second leading source of E. coli infections in the United States, behind ground beef, but the government relies primarily on voluntary safety steps by farmers and packagers to prevent outbreaks.
The cleanliness of fresh produce is drawing new attention amid reports that tainted spinach has been found recently in 21 states, killing at least one person and sickening more than 100 others. A second death was under investigation.
Some consumer groups believe the government should do more to regulate farming and packaging, including the quality of water used for irrigation, the application of manure and sanitary facilities used by workers.
¡°The safeguards are not in place to protect fruits and vegetables in the same way that they are for beef and poultry,¡± said Caroline Smith DeWaal, food-safety director at the Center for Science in the Public Interest.
Foodborne illnesses in the United States cost about $7 billion annually, including medical expenses and productivity losses from missed work, according to estimates from the federal government.
The U.S. food supply is governed by a complex system administered by 15 agencies. Lawmakers in past years have introduced legislation to make one agency responsible for food safety.
Federal officials have also raised concerns that the food supply is vulnerable to contamination by terrorists. Just before leaving office in December 2004, Health and Human Services Secretary Tommy Thompson said he worries ¡°every single night¡± about a possible terror attack on the food supply.
FDA officials do not suspect terrorism in the latest outbreak.
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GE seeks to boost revenue from India to $8 billion
General Electric Co. is planning a rapid buildup of its operations in India over the next four years, as the massive conglomerate hones in on opportunities in the power, health care, water and real-estate markets.
GE is planning to increase its revenue in India to $8 billion by 2010 from $1 billion last year, according to a GE presentation Monday afternoon.
The Fairfield, Conn.-based company, whose products range from credit cards to wind turbines to the TV show ¡°The Apprentice,¡± also wants to expand its assets in India to $8 billion from $2 billion, said slides accompanying a presentation by Dan Henson, chief marketing officer at General Electric.
¡°If you were to ask us to invent a country that lent itself to our capabilities and our value proposition, India would be it,¡± Henson told investors at the Bank of America investment conference in San Francisco.
GE will focus on servicing India¡¯s ¡°significant energy requirements,¡± providing clean water infrastructure and expanding in the commercial real estate and rail markets, he said.
British fund manager to buy John Laing for $1.7 billion
British fund manager Henderson Group PLC is buying John Laing PLC, a developer of doctors¡¯ clinics, hospitals and schools, for $1.67 billion.
Henderson said it will pay 355 pence ($6.67) a share in cash, or a total of 886.9 million pounds for all of Laing¡¯s shares, the companies said in a statement. That represents a premium of 29 percent on Laing¡¯s closing share price Sept. 13, the day before the company said it received an approach from an unidentified bidder.
The deal is expected to be completed in January.
EU antitrust chief denies feud with Microsoft
The European Union¡¯s antitrust chief said she had no personal feud with Microsoft Corp. despite an ongoing legal fight between her office and the software company.
¡°Far from pursuing a vendetta against Microsoft, the Commission¡¯s actions are guided by the desire to create the most innovation-friendly business climate in Europe to the ultimate benefit of European consumers,¡± Neelie Kroes wrote in a letter to the Financial Times.
The EU antitrust commissioner said she is trying to ensure that Windows Vista, the new version of Microsoft¡¯s computer operating system, complies with EU competition rules.
European Union officials have warned Microsoft not to shut out rivals in the security software market, as the company plans to launch Vista with built-in protection against hackers and malicious programs.
Microsoft has said it is concerned that regulators might require the removal of some of the new security features, and warned that EU actions could delay the launch of Vista in Europe.
Shareholder moves to save Aeroflot deal for 22 Dreamliners
A private shareholder of Aeroflot has signed a deal to reserve 22 of Boeing Co.¡¯s popular 787 Dreamliner planes for the state-controlled carrier, which had failed to confirm its order for them in time, the Interfax news agency reported today.
National Reserve Corp.¡¯s main owner, Alexander Lebedev, told Interfax that his company had signed an agreement on general delivery terms for the aircraft to prevent Aeroflot¡¯s deal with Boeing from unraveling.
¡°If the contract with Boeing falls apart, Aeroflot will see colossal losses. We don¡¯t want this to happen, therefore we have reserved these planes on terms proposed by Aeroflot,¡± Lebedev said, according to Interfax.
Lebedev¡¯s National Reserve Corp. controls about 30 percent of Aeroflot stock, which is majority-owned by the state, according to Russian news reports.
Aeroflot¡¯s board of directors failed to confirm the order for 22 jetliners during its meeting last Friday ¡ª the day when Boeing¡¯s offer containing privileged terms on the aircraft¡¯s delivery expired. At the same time, the board did approve a plan to lease an additional 12 Airbus A-320 medium-range airliners and six Boeing MD-11 cargo planes in 2007-2008, Aeroflot said in a statement.
Russian media said Aeroflot¡¯s inaction had been prompted by the Kremlin¡¯s anger over a U.S. decision last month to introduce sanctions on the main Russian state arms exporter and a top aircraft maker over their dealings with Iran.
Danone to buy 49 percent of Denmark¡¯s Aqua d¡¯Or
French beverage and dairy company Groupe Danone SA said it will buy 49 percent of Aqua d¡¯Or, Denmark¡¯s No. 1 still bottled water company, for an undisclosed sum as it seeks to build a presence in the Scandinavian water market.
Launched in 2000, Aqua d¡¯Or reported sales of around 20 million euros ($25.4 million), with more than 30 percent growth in 2005. Aqua d¡¯Or has a 50 percent share of the Danish still water market. It is also No. 2 in Sweden.
Aqua d¡¯Or¡¯s management will retain 51 percent of the stock and continue to run the business, Danone said in a statement.
MONEYWISE CONSUMER NEWS
Toshiba joins list of companies recalling Sony batteries
Toshiba Corp. is recalling 340,000 laptop batteries made by Sony Corp. because of problems with recharging them, the latest in a string of embarrassing defects and production glitches for Sony.
The recall affects 100,000 batteries for laptops sold in the United States, 45,000 in Japan, and the remainder in other parts of the world, Toshiba. spokesman Keisuke Omori said today, declining to quantify the number of problems reported by customers.
The defect is not directly related to the problem behind last month¡¯s recall of Sony laptop batteries by Dell Inc. and Apple Computer Inc., which cited concerns the batteries could overheat and catch fire. Dell asked customers to return 4.1 million faulty batteries, while Apple Computer Inc. recalled 1.8 million.
In both those cases, the troubled lithium-ion batteries were made by Sony Energy Devices Corp., a Japan-based subsidiary of Sony.
The Toshiba recall involves battery packs for Dynabook and Satellite models made from March through May this year, and they will be replaced for free, Omori said. The batteries sometimes stop recharging or run out of power, but no injuries or other accidents have been reported, he said.
Newest Tickle Me Elmo hits stores
He¡¯s still red, fuzzy and really ticklish, but now Elmo¡¯s laughing fits have him slapping his knee, falling to the floor, rolling over and pounding his arm.
Fisher-Price, a unit of Mattel Inc., today took the wraps off T.M.X. Elmo, ending months of unprecedented secrecy that¡¯s had the toy industry abuzz. Until the unveiling, only about 50 people had seen it.
Predicted to be a hot holiday seller, the new and improved Tickle Me Elmo made its debut on ABC¡¯s ¡°Good Morning America¡± as customers lined up at Toys ¡°R¡± Us, Wal-Mart and KB Toys.
The ¡°X¡± in T.M.X. stands for extreme.
¡°When I originally saw a picture of how it moves, I really thought there were some sort of wires, like a puppet, moving it,¡± said Jim Silver, editor-in-chief of Toy Wishes, a trade publication. ¡°We¡¯ve never seen a stuffed animal that has this type of movement.¡±
The debut of T.M.X. Elmo was timed to the 10th anniversary of Tickle Me Elmo, the must-have toy of Christmases past that giggled when its stomach was pressed. In the new version, Elmo¡¯s squeaky laugh and body movements grow more pronounced with three successive tickles.
Executives at KB Toys Inc. and Toys R Us Inc. said pre-orders for the toy, which retails for $39.99, have exceeded expectations.
Federated to Sell Oscar de la Renta Apparel at Macy¡¯s
Federated Department Stores Inc., the second-biggest U.S. department store company, will introduce an exclusive collection of women¡¯s sportswear produced by Oscar de la Renta Ltd. and Kellwood Co. for its expanded Macy¡¯s chain.
The collection, called ¡°O Oscar,¡± will appear in Macy¡¯s starting in 2007, Cincinnati-based Federated said in a statement. Prices will range from $199 to $229 for jackets, $99 to $139 for skirts and $79 to $99 for pants, the company said.
Federated is trying to draw customers to its more than 800 Macy¡¯s stores with exclusive lines that include a women¡¯s apparel collection from designer Elie Tahari and home furnishings by Martha Stewart. The company is also selling more of its own brands of apparel, such as INC and Alfani.
The ¡°O Oscar¡± line also will include dresses, sweaters, shirts and knit tops. De la Renta said in the statement that he hopes to expand the label to accessories, fragrance, and men¡¯s clothing.
U.S. uploading anti-drug videos to YouTube
The White House is distributing government-produced, anti-drug videos on YouTube, the trendy Internet service that already features clips of wacky, drug-induced behavior and step-by-step instructions for growing marijuana plants.
The decision to distribute public service announcements and other videos over YouTube represents the first concerted effort by the U.S. government to influence customers of the popular service, which shows more than 100 million videos a day.
The administration was expected to announce its decision later today. It said it was not paying any money to load its previously produced videos onto YouTube¡¯s service, so the program is effectively free. Already by today, thousands of YouTube users had watched some of the government¡¯s videos.
¡°If just one teen sees this and decides illegal drug use is not the path for them, it will be a success,¡± said Rafael Lemaitre, a spokesman for the White House Office of National Drug Control Policy.
President Bush¡¯s top drug-policy adviser, John Walters, said the agency was using emerging technologies to try to reach its audience. ¡°Public institutions must adapt to meet the realities of these promising technologies,¡± he said.
YouTube Inc., a San Mateo, Calif.-based startup, has become one of the Internet¡¯s hottest properties since two 20-something friends started the company 19 months ago. The free service allows users to share and view videos, most of which are amateurishly produced and include clips of young people singing and dancing ¡ª usually badly.
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