Siemens Slashes Jobs; Southwest Cozies Up to Canada; VMWare Axes CEO; Office Depot Drops on Dismal Sales; Oil Drops $10 in a Week; Fed's New Lending Restrictions; Anheuser Busch Sues InBev; ConocoPhilips Strikes Deal with Abu Dhabi
- Siemens AG (ADR: SI) announced yesterday (Tuesday) that it would eliminate almost 17,000 positions to prepare for a global economic downturn. The Germany-based industrial giant hopes to achieve $1.9 billion (1.2 billion euros) in cost savings by 2010. Chief Executive Peter Loescher said Siemens needed to be faster, more efficient and have a leaner administration if it hoped to compete, Reuters reported.
- Southwest Airlines Co. (LUV) and Canada-based WestJet Airlines Ltd. yesterday (Tuesday) announced a marketing alliance that is planned to go into effect in 2009. "This gives WestJet exactly what they need in terms of growing their trans-border flights," Chris Murray, an analyst at CIBC World Markets Inc. in Toronto, told Bloomberg News. "The deal would make sense for Southwest to build its service into Canada, too."
- Shares of VMWare Inc. (VMW) plummeted yesterday (Tuesday) after the software maker announced it would not meet 2008 expectations, and as a result, replace Chief Executive Officer Diane Greene, an original company co-founder, Reuters reported. VMWare stock dropped $13.00 to close at $40.19.
- Office Depot Inc. (ODP) stock took a hit yesterday (Tuesday) when the office supply retail firm announced North American sales dropped 10% in the second quarter, causing earnings before taxes and interest to be 200 basis points lower than expected. Full earnings for the period will be released July 30. Shares declined $3.29 to close at $7.12.
- U.S. light crude fell more than $6 to as low as $135.14 a barrel yesterday (Tuesday), its lowest level since June 26. Crude oil has now fallen about $10 a barrel since hitting a record high of $145.85 hit last week.
- , The Associated Press reported yesterday (Tuesday). The rules would restrict lenders from penalizing risky borrowers who pay loans off early, require lenders to make sure these borrowers set aside money to pay for taxes and insurance and bar lenders from making loans without proof of a borrower's income.
- Anheuser-Busch Cos. Inc. (BUD) is suing InBev NV after Reuters reported. The suit seeks an injunction to stop InBev from furthering its consent solicitation to replace Anheuser's board until certain alleged false and misleading statements are fixed.
- ConocoPhillips (COP) has signed an interim agreement with Abu Dhabi National Oil Co. to develop the Shah Gas Field in Abu Dhabi, Thomson Financial reported. . Abu Dhabi National Oil will have a 60% interest and ConocoPhillips will have a 40% interest in the project.