Business News
Last Updated on May 09, 2008 13:01 EDT
Banking giant to shed $500B in assets
NEW YORK (AP) -- Citigroup says it wants to shed about 500 billion dollars in assets, while growing revenue by 9 percent over the next few years. It is trying to rebound from massive losses linked to slumping mortgage and credit markets. The bank's plans to wind down its base of 2.2 trillion dollars in assets were part of an investor day presentation. Citigroup has been under investor pressure over the past year as its stock price has tumbled. Many shareholders have been pressing for a large-scale overhaul of the bhaking giant's structure. Citi has written down its assets by some 38 billion dollars since last summer. It has also built reserves to account for future possible consumer loan defaults and has raised more than 40 billion dollars in cash by selling stakes to outside investors, offering new stock and shedding other assets.
Trade deficit sees big reduction
WASHINGTON (AP) -- The U.S. trade deficit narrowed more sharply in March than expected. The Commerce Department says the trade gap totaled more than 58 billion dollars, marking a 5.6 percent reduction from February. The smaller deficit reflects falling demand for imports. They saw a decline of 2.9 percent, the largest one-month drop since December 2001, one month after the last recession ended. Exports, which have been a strong point in this period of weakness, suffered a setback in March. They eased 1.7 percent to the second highest level on record. Sales of commercial airliners, cars, computers and machinery were all down. Ian Shepherdson, chief economist at High Frequency Economics, says he expects the improvement in the March deficit to prompt the government to revise upward its estimate for first-quarter economic growth.
Icahn prepared to buy Circuit City if Blockbuster can't
RICHMOND, Va. (AP) -- Circuit City Stores says it will allow video-rental chain Blockbuster, and its largest shareholder Carl Icahn, to review its books in connection with Blockbuster's bid to buy the consumer electronics retailer. Circuit City also says it has received a letter from Icahn, a Blockbuster board member, saying he's prepared to buy the company if Blockbuster can't get financing on its own or get shareholder approval. Blockbuster publicly announced a takeover bid of just over 1 billion dollars for Circuit City, with plans for creating a huge chain that would sell electronic gadgets and rent movies and games. Circuit City has said it doubts Blockbuster could finance the deal and has resisted opening its books. Blockbuster says in a statement that it was pleased to reach a due diligence agreement with Circuit City. At midday, Circuit City shares were up 8 percent on the news.
Diageo reducing jobs at Dublin landmark
DUBLIN, Ireland (AP) -- It is a stiff drink for some workers employed by Ireland's Guinness beer company, parented by Diageo PLC. It has announced plans to lay off more than half of its brewery workers, close two breweries and shift most beer production to a new, high-tech plant in the Dublin suburbs by 2013. The British beverage company decided not to close the landmark Guinness brewery, one of Dublin's oldest businesses and a top tourist attraction. It concluded such a move would do too much damage to its brand and customer sentiment. Diageo expects to lay off about 250 people, or 58 percent of its current brewery work force in Ireland, over the next five years. Brewing staff at the flagship Guinness brewery at St. James' Gate in west Dublin will be slashed from 230 to just 65.
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