In other top business and financial stories from around the world:
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The Bank of England said yesterday (Wednesday) that it would inject $20 billion into the long-term money markets next week because of the ongoing worldwide credit crunch. The British central bank is addressing liquidity issues in the so-called “Interbank” market – where commercial banks lend to each other. The money will be injected next week via a bidding process and will be payable after three months. Three more auctions will be held over the next three weeks, the BoE said – without specifying the amount of additional liquidity that will be involved. Commercial banks – like the highly troubled Northern Rock – are nervous about lending to one another because of fears about bad debts linked to the subprime mortgage market in the United States.
- Wholesale steel prices in China – the world’s No. 1 consumer of the alloy – soared 12.2% in August from a year ago as China’s government shuttered smaller mills and put the brakes on industry investment. Korean steelmaker POSCO (PKX) is expected to benefit.
- Shares of Tenaris, an Italian steel-pipe producer surged as much as 5% yesterday, on speculation that global steel giant ArcelorMittal (MT) was looking to buy the company, The Economic Times reported. Shares of Tenaris were trading at the equivalent of $24.74 each, while the reported takeover price was $30.52 per share, according to published reports.
- Japan's Mitsubishi Heavy Industries Ltd., plans to enter the Russian power-plant market utilizing a joint venture with Renova Group, a conglomerate, the Nikkei Daily reported yesterday. The partnership should be announced within days, and will make Mitsubishi Heavy Japan’s first heavy-equipment company to enter this Russian market, Nikkei reported. Russia's state-run utility, Unified Energy Systems, plans to invest roughly $56 billion by 2010.
- Hewlett-Packard Co. (HPQ), the world's No. 1 PC maker, said yesterday that it will double its Taiwan employment – from 300 to 600 – between now and 2009, a key element of its plan to boost its product-development activities in that country. Ted Clark, a senior vice president and GM of H-P’s mobile computing and global business unit, told Reuters that “part of our strategy is to increase local hires and expand Taiwan operations.” H-P’s notebook-computer business currently has four design centers – in Taiwan, China, German and the United States. Taiwan has emerged as the global epicenter of the PC-manufacturing business, with such contract-manufacturers as Quanta Computer, Asustek, and Compal Electronics building 80% of the world’s laptops. Hon Hai Precision Industries Ltd, is also headquartered in Taiwan.
- Hyundai Motor Co., will introduce a premium car in China in April in an attempt to land wealthy customers and build market share in the world’s No. 2 auto market, South Korea's top automaker said yesterday. Hyundai will introduce the premium model in the world’s No. 2 auto market in April. It has yet to announce the price of its so-called “BH” model sedan, although Chinese media reports have pegged the price at about $53,180, Hyundai spokesman Jake Jang told The Economic Times, adding that “we aim to sell 3,000 units of the BH in China in 2008.” Hyundai – the world’s No. 6 automaker by sales volume with affiliate KIA Motors Corp. factored in – has experienced sluggish sales in China, something the new car model isn’t expected to immediately fix. But the move should help upgrade its brand image, so that consumers start to see that it’s more than just a builder of dependable, low-priced cars. The “BH” will also be sold in the U.S. market.
- British aerospace company Smiths Group PLC and General Electric Co. (GE) yesterday announced that they’ve ended plans for a Smiths GE Detection joint venture, a plan that was announced on March 21. The two companies said they “now believe the interests of both businesses are best-served by their remaining independent.”