Va. company buys Foundation Coal
In a merger that would create the country's third-largest coal producer, Foundation Coal Holdings Inc. of Linthicum Heights said yesterday that it intends to combine with a Virginia competitor in a $2 billion deal. The merger of Foundation and Alpha Natural Resources Inc., based in Abingdon, Va., would create a new company that operates a combined 59 coal mines and 14 processing plants, and is worth more than $3.5 billion, company officials said. The merger is an all-stock transaction valued at about $2 billion, with the new company assuming roughly $530 million in debt from Foundation. The company will retain the Alpha name and its Virginia headquarters. Michael Quillen, Alpha's chairman and chief executive officer, said he didn't expect any "significant change" in staffing at Foundation's headquarters in Linthicum Heights through the end of 2010. There are 130 people employed there.
- Gus G. Sentementes
Trade deficit widens to $27.6 billion in March
WASHINGTON : The U.S. trade deficit rose in March for the first time since last July as the global recession cut sharply into sales of American exports. The politically sensitive deficit with China increased. The Commerce Department said Tuesday that the deficit widened to $27.6 billion in March, slightly lower than the $29 billion gap that economists had forecast. The March deficit was 5.5 percent higher than February's revised trade gap, which had been the smallest since November 1999. Through the first three months of this year, the trade deficit was running at an annual rate of $359.7 billion, far below last year's $681.1 billion. Economists expect the deficit will remain at low levels this year as a recession in the U.S. crimps demand for foreign goods.
Freddie Mac seeks $6.1B in U.S. aid after 1Q loss
WASHINGTON: Mortgage giant Freddie Mac is looking for $6.1 billion in additional government aid as the cost to taxpayers from the housing market bust keeps growing. The McLean, Va.-based company, seized by federal regulators in September, on Tuesday posted a loss of $9.9 billion, or $3.14 per share, for the quarter ending March 31. That compared with a loss of $149 million, or 66 cents a share, in the year-ago period. The results were driven by $8.8 billion in credit losses due to soaring delinquency rates and falling home prices, and $7.1 billion in writedowns of the value of its mortgage-backed securities. More than $63 billion of Freddie Mac's loans were either 90 days overdue or in foreclosure at the end of March, nearly triple year-ago levels. The request for federal aid is Freddie Mac's third since the takeover, for a total of about $51 billion.
Chrysler to cut 800 dealers, lawyer says
DETROIT: Chrysler LLC plans to fire up to 800 of its 3,200 dealers on Thursday, a lawyer seeking to represent the dealers said on a conference call. The lawyer, Stephen Lerner, who heads the bankruptcy and restructuring practice of the law firm Squire Sanders, told dealers on the Tuesday call that the automaker plans to reject at least 800 franchise agreements, according to a dealer who listened to the call. Chrysler will file a list of dealers it wants to retain with the U.S. bankruptcy court, said the dealer, who asked not to be identified because the call was confidential. Chrysler spokeswoman Kathy Graham said the 800 number was just speculation and that the company did not have a final list yet.