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Target Misses the Mark; General Dynamics Broadens Horizons; Chavez Bounces Cemex; Manchester United Scores with Saudi Deal; Lacker Lobbies for Rate Hike; Carlyle Group Chair Steps Down; Hedge Fund Fraud Judgment; Quiznos Overseas Expansion
- Target Corp. (TGT) yesterday (Tuesday) reported a 7.6% drop in second-quarter profit to $634 million, or 82 cents per share. Sales were up 5.7% to $15 billion from $14.2 billion, but same-store sales, or sales at stores opened at least a year, slipped 0.4%.
- General Dynamics Corp. (GD) announced yesterday (Tuesday) that it would buy Jet Aviation for about $2.25 billion in cash. General Dynamics – best known for its tanks, ships, and submarines – , The Associated Press reported.
- Venezuela's government seized control of cement plants owned by Mexico's Cemex SAB (ADR: CX), , The Associated Press reported. Government officials backed by National Guard troops took control of Cemex's local plants late Monday night, after a 60-day period for negotiating expired.
- Premier League soccer champion Manchester United has agreed on a five-year, $18.2 million sponsorship deal with Saudi Telecom Co., the Arab world's largest phone company, Bloomberg News reported. Saudi Telecom will have exclusive rights to use United's brand in its domestic marketing, and to offer subscribers game highlights and team news through mobile phones.
- Federal Reserve Bank of Richmond President Jeffrey Lacker feels the Federal Open Market Committee might have to hike interest rates before signs of an economic recovery are confirmed. "It is important to withdraw this monetary policy stimulus in a timely way," Lacker said yesterday (Tuesday) in a Bloomberg Television interview. "That may require us to withdraw before we are certain all of the weakness is behind us and before we are completely certain that financial markets are as tranquil as we would like to see."
- Louis V. Gerstner Jr. will step down as chairman of The Carlyle Group after five years with the private-equity firm. Gerstner will remain on as senior advisor, The New York Times reported. "Initially, I committed to be chairman of Carlyle for one year. But year after year I continued to be impressed with Carlyle's value creation model and its efforts to globalize the firm," Mr. Gerstner said in a statement. "However, at this point in my life, I have a number of goals and interests yet to fulfill, requiring me to step back at Carlyle." Carlyle has yet to name a successor.
- A federal court ordered Philadelphia Alternative Asset Management Co. and the hedge fund's founder, Paul Eustace, to pay $279 million in restitution, plus a $12 million fine. Eustace and the PAAM hedge fund, which collapsed in 2005, were accused of defrauding clients by U.S. commodities regulators, Bloomberg News reported.
- Popular fast-food chain Quiznos Corp. announced yesterday (Tuesday) that it plans to double its international presence over the next two years. , and will expand its presence in the Middle East and Eastern Europe, DowJones reported.