Monday AM April 21st, 2008
by: Ed Mayberry, April 21, 2008 12:04:00 pm
Halliburton confirms talking with European contractor Expro International Group about a possible all-cash purchase of the overseas outfit. Houston-based Halliburton's update came one day after a consortium led by London-based Candover Group said it will buy Expro International for 3.2 billion. In a statement, Halliburton said its cash offer would top the one made by Candover but gave no specifics. Halliburton, which provides services and equipment to oil and natural gas companies, sees Expro's sub-sea and flow management sector to be an area of potential expansion.
The army has awarded KBR, Dyncorp International and Fluor contracts worth up to $150 billion to provide food and shelter to U.S. troops overseas. The army originally picked the same three companies for the logistics deal last July, but had to re-evaluate its decision after a federal watchdog agency backed protests filed by two private firms. The Government Accountability Office in October supported the protests filed by IAP Worldwide Services and Contingency Management Group. KBR, Dyncorp and Fluor each were awarded one-year contracts worth up to $5 billion. If all options are exercised over ten years, the combined value of the pacts is $150 billion.
Testimony is expected to continue today in the trial of a former Kellogg, Brown & Root procurement official. A government witness has offered more details on an officer of a construction company who allegedly cheated the Department of Defense out of nearly $5 million on trucks used in the Middle East. Jeff Alex Mazon is a former procurement materials and property manager for Houston-based KBR, a one-time Halliburton subsidiary. The company had a contract with the U.S. Army Sustainment Command at the Rock Island arsenal in Illinois. The 39-year-old Mazon is being tried in U.S. District Court on four counts of major fraud against the United States and six counts of wire fraud. Testimony came from David Hadcock, principal procurement manager for KBR.
Transportation Secretary Mary Peters is demanding that federal regulators and American Airlines explain why 250,000 U.S. air travelers endured canceled flights last week during safety inspections. Peters told reporters that she doesn't believe the Federal Aviation Administration overreacted in insisting on the rapid rewiring and checks of wiring on MD-80 jetliners. But as she put it: "no one at all was well-served by what happened last week.'' The secretary ordered the FAA and the airline to explain to her within two weeks what happened and why and how such massive inconvenience to travelers could be avoided in the future while still enforcing safety rules. American canceled about 3,100 flights to do the inspections and fixes on its planes.
House Democrats are moving to push through a bill to help homeowners caught in the foreclosure crisis. The plan introduced by the House Financial Services Committee Chairman Barney Frank calls for the government to provide about $300 billion worth of mortgage guarantees for homeowners caught in the mortgage squeeze. Frank says congressional analysts figure the plan would cost taxpayers around $3 to $4 billion, depending on how many homeowners default. House Speaker Nancy Pelosi wants quick action, saying the administration hasn't done enough to resolve the crisis. Some Republicans are leery of providing government help to homeowners who have overextended themselves.
Wall Street investment houses have been less reliant lately on the lifeline thrown to them by the Federal Reserve. The central bank says the big firms averaged nearly $25 billion in daily borrowing over the past week--down from more than $32 billion in the previous week. The program, which began a month ago, is one of several extraordinary actions the Fed has taken recently to limit damage from a trio of crises in the housing, credit and financial markets. After the crash of Bear Stearns, the nation's fifth-largest investment bank, fears grew that others might be in jeopardy, given major stresses in credit and financial markets.
President Bush signed a one-week extension of current farm law as the House and Senate continued debating how to pay for a multibillion-dollar farm bill. The extension passed last week will keep the farm program going until this Friday, April 25th. Bush has threatened to veto the House and Senate bills, which would cost roughly $280 billion over five years to expand agriculture and nutrition programs. He says they are too expensive and would not sufficiently cut subsidy payments to wealthy farmers in a time of robust farm prices. Deputy Agriculture Secretary Charles Conner had said that Bush would only sign the extension if it appeared negotiators had made significant progress on the bill.
The Justice Department says American Airlines will settle a class action lawsuit brought by more than 350 pilots in a military leave dispute. The pilots say they were unfairly penalized by Fort Worth-based American for not being allowed to accrue time for vacation and sick days while on military leave. If accepted by a federal judge in Dallas, the settlement will force the nation's largest commercial airline to pay the pilots a total of nearly $346,000. It also will require American Airlines to pay its pilots $215,000 worth of sick leave credits. American Airlines spokesman Tim Wagner called the settlement a "fair and reasonable agreement.'' U.S. Attorney General Michael Mukasey says no member of the military should be disadvantaged for choosing to serve our country and for answering the call of duty.
The House has passed a measure aimed at ensuring that students get college loans amid the turmoil in the credit markets. Worries have risen recently that the tightening credit markets, stemming from the subprime mortgage crisis, could limit financial aid for students. Dozens of lenders, making up an estimated 13 percent of the market, recently stopped making loans under the federal student loan program. That's where the government subsidizes and backs low-interest loans. The departure of those lenders hasn't resulted in students being shut out of the program. Other lenders have stepped in, or the students have received loans through a smaller program where the Education Department makes the loans directly to students.
U.S. retail sales of video games jumped 57 percent to $1.7 billion in March, according to market researcher NPD Group. Nintendo led the way with its games and systems. Video game software sales jumped 63 percent from March 2007 to more than $945 million, blowing past analysts' expectations. Nintendo's "Super Smash Bros: Brawl'' for the Wii was the month's top-selling game with 2.7 million units sold. Coming in a distant second was "Tom Clancy's Rainbow Six: Vegas 2'' from Ubisoft with 752,300 units and "Army of Two'' from Electronic Arts Incorporated with 606,100. All three games hit store shelves in March.
A Homeland Security survey of 141,000 of its employees finds a lot of job dissatisfaction. An internal survey asked about two-thirds of the department's employees about their work. Fifty-eight percent of them said they're satisfied with their jobs. According to the survey, nine out of every 10 people who work at the department think the work they do is important, but only a little over half would recommend the department as a good place to work. That's a slight improvement over the findings of a 2006 survey, which Homeland Security ranked at the bottom of federal job satisfaction. A spokeswoman says some of the low morale can be attributed to the fact that the department doesn't have a central headquarters yet.