Chinese firm buy stake in Daewoo
Chinese firm buy stake in Daewoo
SEOUL : South Korea's bankrupt Daewoo Motor Co. said Sunday that Shanghai Automotive Industry Corp. would acquire a 10 percent stake in a new Daewoo company to be set up by U.S. giant General Motors Corp (GM).
The leading Chinese firm will buy the stake for US$59.7 million, Daewoo said.
The acquisition means Shanghai Automotive will be the first Chinese carmaker to invest in a foreign firm. It holds 50 percent in the Chinese market and runs three joint ventures with General Motors.
General Motors will own 42.1 percent of the new entity, called GM Daewoo Auto and Technology Co., Japan's Suzuki Motor Corp. will hold 14.9 percent by, Shanghai Automotive 10 percent while creditors have 33 percent.
General Motors agreed in April to take over Daewoo's two passenger car factories in South Korea and overseas units including a plant in Vietnam. Daewoo was declared bankrupt two years ago.
South Korean creditors have promised to convert 13.15 trillion won ($10.7 billion) of Daewoo's debt into equity to clear bad assets. --AFP.
Strikes cripple Fiat plants
MILAN : Strikes crippled Fiat plants across Italy Friday in protest of a rescue plan by the country's largest private sector employer that includes massive layoffs and plant closures.
Thousands of Fiat workers, angered by the restructuring plan announced Wednesday, failed to show up for work at the factories of Fiat Auto and at other units, such as metalworking and machine tooling plants.
Flagship automaking division Fiat Auto, which is an industrial icon but a major drain on the group's resources, is bearing the brunt of the job reductions.
In an interview with Italian newspaper La Stampa, which is owned by the group, Fiat Auto chief executive Boschetti said "the plan will stay the way it is."
Fiat announced on Wednesday 8,100 job reductions through temporary layoffs and early retirement. Fiat wants the 7,600 layoffs to be financed by a special long-term unemployment fund to which the government would contribute. -- AFP Lucent to cut 10,000 jobs
NEW JERSEY, UNITED STATES : U.S. telecom equipment group Lucent Technologies announced Friday it would cut 10,000 jobs, or 22 percent of its workforce, by 2003.
The firm -- which had about 45,000 employees at the end of the 2002 fiscal year in late September -- said it planned to trim its workforce to 35,000 by the end of fiscal 2003.
Lucent said as early as September 13 that it would cut jobs but did not reveal the size or scope of its restructuring plan.
The company said it would also announce fourth-quarter losses that were "significantly larger" than the previously announced US 45 cents per share. That figure was about three times greater than what Wall Street analysts had forecast.
The one-time star of the telecommunications industry has been among the hardest hit by the brutal slump in the sector, amid a spate of canceled orders and failed dot-coms unable to pay their debts. -- Dow Jones
EU to approve De Beers strategy
BRUSSELS : The European Commission is close to approving a new diamond sales program by South African mining giant De Beers that could reshape the multibillion-dollar luxury market, a source in Brussels said Friday.
The office of European antitrust regulator Mario Monti "should not find much fault with" the project given concessions made by De Beers to its so-called supplier-of-choice strategy, the source said.
"The decision should not take long now," it added, indirectly confirming an earlier report in the Wall Street Journal.
De Beers unveiled last year its new strategy, which seeks to increase its control of the retail market through a codified relationship with established diamond distributors, known as "sightholders," the Journal said.
The Commission's antitrust regulators became concerned that De Beers could use the new strategy to restrict distribution of rough diamonds to a select few middlemen and thus limit competition, potentially raising retail prices. --AFP
ZDF forced to make economic cuts
MAINZ, GERMANY : Germany's second public television channel ZDF, hit hard like other German media by falling advertising budgets, announced an economy package Friday aimed at saving 50 million euros a year.
ZDF said after a board meeting that without making the economies, it risked running up a deficit of some 200 million euros by the end of 2004.
ZDF chief Markus Schaechter said it should not lead to forced redundancies or sackings. The channel will also look at its programming, making more room for news.
ZDF is Germany's third most popular channel after its public rival ARD and the commercial station RTL.
Falling income from advertisers and rising costs of newsprint have already forced a number of prestigious German media concerns, including the Springer group which publishes the daily Bild and Die Welt newspapers, either to raise their cover prices or to cut jobs, or sometimes both. -- AFP