Tuesday AM December 19th, 2006
by: Ed Mayberry, December 19, 2006 5:12:00 am
A Greater Houston Partnership delegation leaves on a one-day business development mission to Mexico today, meeting with President Felipe Calderon and five members of his cabinet. The delegation will also meet with the Minister of Energy, A Central Bank of Mexico official, the CEO of PEMEX, an official with the Ministry of Foreign Relations, an official with the Ministry of the Economy and an official with the Ministry of Communications and Transportation. The Houston delegation is being led by John Hofmeister, president and chairman of Shell Oil USA and 2007 chairman of the Greater Houston Partnership. The delegation includes the aviation director of Houston's airports, as well as leaders of El Paso Corporation, Continental Airlines, the Port of Houston Authority, Mitsubishi Caterpillar Forklift America, Parker Drilling and others.
ConocoPhillips has reached an agreement to sell 376 of its European fueling stations to Russia's Lukoil in a transaction expected to be completed by the second quarter of 2007. The agreement affects gas stations in six countries—156 stations in Belgium, 49 in Finland, 44 in the Czech Republic, 30 in Hungary, 83 in Poland and 14 in the Slovak Republic. They will be re-branded from Jet stations to Lukoil stations within two years. As part of a previous agreement, ConocoPhillips will hold a 20 percent stake in Lukoil by the end of this year.
Houston-based Encysive Pharmaceuticals has launched its hypertension drug Thelin in Germany. Encysive received European Union marketing authorization from the European Commission in August, licensing the drug in all 25 member states. The drug was approved as the first one-daily oral treatment available for patients with pulmonary arterial hypertension. Thelin is already available in the UK.
Mall owners Simon Properties Group and Westfield Properties have formed a partnership with the Service Employees International Union, opening the way for some 5,000 janitorial workers in 373 malls around the country to form a union. Simon owns the Galleria. Under the new agreement, Westfield and Simon have agreed to support vendor contracts that provide higher wages and health benefits to contracted-out janitorial employees. In late November, striking unionized Houston janitors reached an agreement with cleaning firms that will dramatically raise their wages and add health insurance benefits. Some 5,300 area janitors will see their wages rise 21 percent on January 1st to $6.25 an hour, then $7.25 an hour in 2008 and $7.75 in 2009.
More a dozen former Swift employees are suing the meat packing company for $23 million--alleging officials conspired to depress wages by hiring illegal immigrants. The 18 former employees are legal residents who worked at the Swift meat packing plant in Cactus, north of Amarillo. The Cactus site was raided by U.S. Immigration and Customs enforcement agents along with facilities in five others states last week. Nearly 1,300 employees were arrested in the multi-state immigration sweep that temporarily halted operations. Dallas attorney Angel Reyes says the plaintiffs are victims in a longstanding scheme by Swift to depress and artificially lower the wages of its workers by knowingly hiring illegal workers. Attorneys for the former employees filed a lawsuit late Friday against Swift and its owners, Dallas-based investment firm H.S. Capital Partners. They contend Swift and H.M. Capital Partners engaged in racketeering to manipulate commerce.
The world's largest casino company is about to be bought out. According to a source familiar with the talks, Harrah's is agreeing to a $90 a share offer from two private equity operations. The deal values Harrah's at $16.7 billion. The buyers are Apollo Management Group and Texas Pacific Group, which initially offered $81 a share in October. They finally beat out race track and casino operator Penn National Gaming, which reportedly offered $87 a share. The source says agreement came late last week, but lawyers are still working out the fine points. Harrah's operates 39 casinos, including namesake properties in Las Vegas and Atlantic City.
American Airlines has announced a four year, $30 million deal to maintain planes for Allegiant Air. It's part of Fort Worth-based American's strategy of boosting revenue by performing work that other carriers used to do for themselves. American will conduct big maintenance jobs on Allegiant's fleet of 24 MD-80 series aircraft and any additional planes added by the Las Vegas-based carrier. The work will be done at American's largest maintenance hub--in Tulsa, Oklahoma. American has about 7,000 workers at the Tulsa base. Company officials say the Allegiant work won't increase that number--but might make those jobs more secure. Allegiant serves Orlando and Tampa-St. Petersburg, Florida, plus Las Vegas, from secondary airports around the country. It also runs charter flights for Harrah's Casinos.
Houston-based Petro-Chem Inspection Services has been acquired by TUV SUD America, a subsidiary of a Munich, Germany-based company. PetroChem provides non-destructive examination and testing services for the petrochemical and other process-related industries. The firm has 400 employees.
Houston-based EV Energy Partners has acquired oil and gas properties in north Louisiana, east Texas, western Oklahoma and west Texas, according to the Houston Business Journal, in a $27.8 million deal. The properties include 269 wells from Dallas-based Five States Energy Company.
Houston-based (STRONG>International Gas Consulting has reached an agreement to sell its natural gas storage consulting business to Kilgore-based Martin Resource Management. MRMC will acquire employees that had been in the natural gas storage consultancy arm of IRC.
Barnett PetroSearch has created a partnership with two other companies to develop the Barnett Shale properties in the Fort Worth Basin, according to the Houston Business Journal. Production from six wells already drilled is expected to begin in early 2007.
Tennessee-based CBL & Associates Properties has completed an additional 147-acre land purchase for Pearland Town Center. Construction begins in the first quarter of 2007, with a grand opening set for fall 2008. Pearland Town Center will feature an open-air lifestyle center anchored by Dillard's and Macy's, with 90 specialty retailers and a 110-room, four-story Courtyard by Marriott hotel.
Roofing and building materials maker Elkcorp has agreed to a private equity buyout worth about $827 million plus about $173 million in debt. Under terms of the deal with the Carlyle Group shareholders will get $38 per share--a 51 percent premium over share price in early November. The deal is still subject to shareholder approval. It's expected to close by spring. Separately, Carlyle agreed to a deal with Hood Companies to merge hood subsidiary Atlas Roofing with Dallas-based Elkcorp. The two deals are not contingent upon one another. Analysts say the building materials business has suffered a slowdown after hurricane-driven run-ups and years of strong demand for new home construction. Elkcorp has manufacturing facilities for shingles, composite wood decking and other materials in Texas, California, Pennsylvania, Alabama, Kansas and Ohio.
Nueces County has proposed strict new building limits for its 21 miles of beach--to the dismay of local cities and developers. The proposed rule would restrict most construction to 350 feet behind the beach vegetation line. That's 150 feet more than the state guideline. The Texas General Land Office is expected to decide in January whether to certify the proposal. If allowed, Nueces County's rule would be the most restrictive on the Texas coast. County officials say the rule would provide protection for the beach's dune ridges, which buffer coastal communities from hurricanes. But developers and city leaders in Corpus Christi and Port Aransas oppose the move. They argue the rule amounts to an illegal land grab and would stifle job creation, lower taxable property values and cheat private landowners of income potential.
The chairman of the Federal Communications Commission says cable television rates keep going up while prices for other communications services are going down. Kevin Martin blames local governments for blocking competition. And he's proposing to change that. On Wednesday, the FCC is scheduled to vote on whether to make it easier for competitors to obtain cable franchises. The proposal is backed by Verizon Communications and AT&T, which have poured billions of dollars into rewiring their old telecommunications networks so they can deliver television programming and other services. But local franchising authorities are alarmed, and say action by the agency may wind up hurting consumers.
Union members have been protesting Goodyear Tire & Rubber outside about 150 retail locations in the U.S. and Canada. They're speaking out against Goodyear's use of temporary workers during a two-month strike by unionized employees. One union official says tires can't be made by unskilled workers and such products shouldn't be sold to the general public. Others are calling on customers to show their support of unionized employees. About 1,500 workers went on strike at 12 North American plants after contract negotiations broke down in October. Goodyear has since hired nonunion and temporary workers to meet production needs. A spokesman for Goodyear says the protests didn't affect plans to return to negotiations Monday.