Monday PM December 4th, 2006
by: Ed Mayberry, December 4, 2006 5:12:00 am
Demand for previously owned homes continues to be soft. The National Association of Realtors says its Index for Pending Sales of Existing Homes fell at an annual rate of 1.7 percent in October. It's the eighth decline in the past 12 months. The index, which is based on signed contracts for homes, was down more than 13 percent from October of last year. The biggest decline came in the west, where pending sales were down 2.7 percent. That was followed by a 2.1 percent drop in the northeast, a decline of 1.7 percent in the south and a dip of just six-tenths percent in the midwest. Just last week, the NAR reported sales of existing homes rose in October for the first time in eight months, while the median home price fell three and a-half percent--the largest decline on record.
Texas and ten other states have reached agreed final judgments with Zurich American Insurance, requiring the company to implement business reforms and refund $9 million to Texas commercial policyholders as part of an antitrust settlement initiated last March. The investigation alleged the company participated in widespread, deceptive bid-rigging, price-fixing and other schemes in the commercial insurance market. Texas Attorney General Greg Abbott says large and small companies, nonprofit organizations and government offices that purchased commercial lines of insurance from Zurich were misled into believing they were receiving the most competitive commercial premiums available. Zurich will be required to distribute about $122 million in refunds to commercial policyholders, including an estimated $9.3 million to Texans.
Alabama energy holding company Energen says one of its units sold its $12.5 million Enron bankruptcy settlement claim for an estimated profit of $6.7 million.
Enron investors cannot pursue securities fraud claims against money manager AllianceBernstein Holding over its role in Enron's collapse. Houston Federal Judge Melinda Harmon says the investors cannot prove that AllianceBernstein controlled the actions of one of their officials, who also served on Enron's board. Judge Harmon ordered the investors to pay AllianceBernstein's legal fees and costs in the case.
East Texas-based poultry producer Pilgrim's Pride says it's agreed to buy rival Gold Kist for $1.1 billion in cash. The deal values Gold Kist at $21 a share. The offer is $1 per share higher than Pilgrim's Pride's initial offer, first announced in August. Atlanta-based Gold Kist rejected that bid, saying at the time that it wanted to remain a private company. But by last Wednesday, Gold Kist shareholders had tendered 67 percent of the company's stock to Pittsburg-based Pilgrim's Pride. The combined company would be the third-largest U.S. meat protein company by revenue, according to the companies. Pilgrim's Pride says the deal will begin to add to earnings after the first full year of operations. It expects to save $50 million annually from the acquisition. Pilgrim's Pride will also assume about $144 million in Gold Kist's debt.
Two-hundred workers couldn't go to work Monday morning in suburban Fort Worth because a four-alarm fire destroyed a mobile-home factory. The blaze happened Saturday at the Palm Harbor Homes plant. No one was working there at the time. The cause of the fire is unknown. By the time firefighters arrived, the fire had already done significant damage. A city spokeswoman says fire crews had to pull out of the factory when the roof collapsed. Firefighters continued to address hot spots Sunday.
The head of Exxon Mobil says proposals by Congressional Democrats to drop oil industry tax breaks and subsidies would set a bad example overseas. Rex Tillerson also said such moves would discourage new industry investments. Tillerson spoke at the Boston College Chief Executives Club. Irving-based Exxon Mobil is the world's largest publicly traded oil company. House Democrats have said they'll target oil company tax breaks for a quick repeal next year. Such moves come partly in response to high summer fuel prices and recent huge industry profits. When asked by an audience member whether oil profits are excessive, Tillerson said the industry's fortunes are tied to fluctuating oil prices that remain historically high—despite recent declines. He also says expensive ventures to find new oil reserves--often fizzle.
How quickly do you want to get hired? Several oil and gas companies are resorting to unusual hiring techniques in an effort to fill thousands of vacant engineering jobs. A concept called "speed interviewing'' was tried in Houston Saturday and officials say it far exceeded expectations. Several hundred people were expected, but lines formed well before the opening of the event. The lines were so long that a holding area had filled up in an hour. Foster Wheeler USA says "speed interviewing'' was modeled after "speed dating,'' when participants talk to a large number of prospective dates. Job interviews that would normally last up to 90 minutes were finished in at most 15. Officials have no idea how many hires will come out of the process.