Borders Group (NYSE:BGP) may survive its downturn in sales and weak balance sheet — or it may not. Its latest plan is to buy time by delaying payments to vendors and landlords. But this will work only if those who are owed money by Borders eventually get some — or all — of that money back. Borders says it will postpone January payments to many vendors to conserve cash. It’s not clear that the move will do anything more than delay a possible prepackaged bankruptcy or a breakup of the company. In its announcement, reported in a number of media, the book chain said it "understands the impact of its decision on the affected parties." General Electric (NYSE:GE) financial division said it would provide Borders with a $550 million line of credit, but this involves conditions Borders may not be able to comply with. -Daily Finance
U.S. consumers, supported by fatter paychecks and low prices, accelerated their spending at the end of 2010, giving a needed boost to the economy’s weak recovery. Consumer spending grew by 0.7% in December, the Commerce Department reported Monday. Americans’ incomes rose by 0.4% for a second month in a row.-The Wall Street Journal
Exxon Mobil (NYSE:XOM) said Monday its fourth-quarter earnings rose 53% to $9.25 billion, or $1.85 a share, from $6.05 billion, or $1.27 a share, in the year-ago period. Wall Street analysts expected the Irving, Texas, company to earn $1.62 a share, according to a survey by FactSet Research. It’s the richest quarterly profit for the oil major since the third quarter of 2008, when it earned $14.83 billion. Fourth-quarter capital spending rose to $10.06 billion, from $8.26 billion. Oil-equivalent production in the fourth quarter rose 19%. All told for 2010, Exxon Mobil’s profit rose 57% to $30.5 billion, in the face of higher crude oil and natural gas price realizations, improved refining margins and a record performance at its Chemical unit. -MarketWatch
Reports have been around or months that Alpha Natural Resources (NYSE:ANR) would acquire Massey Energy (NYSE:MEE). Other suitors were mentioned, but Alpha was always at the top of the list, mainly because produces more metallurgical coal than any other US miner, and Massey, with the largest met coal reserves in the US, seemed to be a logical target.
The companies have finally pulled the trigger on the merger, with Alpha offering 1.025 shares of its stock plus $10/share in cash for Massey. Including debt, the deal is worth a total of about $8.5 billion. Alpha shareholders will end up 54% of the combined company, while Massey shareholders will finish with 46%. The combined company will become the second largest US coal company by market cap, trailing Peabody Energy (NYSE: BTU). -24/7 Wall St.
Filed under: 