Advertiser Staff and News Services
Local real estate developer Peter Savio and his wife filed for Chapter 11 bankruptcy Friday, saying they have unsecured debts of $45 million. The largest debt $20 million - is owed to Beal Bank of Dallas. The debt stems from Savios purchase and attempted resale of the Queen Emma Gardens project. Other debts include $7.5 million to First Hawaiian Bank and $6 million to Kamehameha Investment Corp. Many of the listed debts are personal guarantees of loans borrowed by Savio Development Co. Savio Development Co. filed Chapter 11 bankruptcy in January 2000 after dozens of customers failed to repay loans the company made to help them qualify for mortgages.
Model trainmaker Lionel LLC will close its manufacturing operations in Macomb County, Mich., by the end of August. Its distribution center, corporate headquarters and some other offices will remain in Chesterfield Township, the company said. About 325 workers will be laid off initially, but some will be offered new positions, the company said. Earlier this month, Lionel said it might move its manufacturing operation to Korea or China, blaming increased costs and competition. About half its products are already made in those countries. Founded in 1900, Lionel had reported revenues of more than $33 million by 1953 and was the worlds biggest toy company. But the company faltered in the 1960s, and model trains became less popular.
January mergers and acquisitions fell to the lowest level since 1998 as investment bankers said sinking stock prices and a cooling U.S. economy made chief executives more cautious about buying and selling companies. It was the slowest month for corporate matchmaking since September 1998. Januarys total was $108.4 billion, or one quarter that of January 2000, when America Online Inc. said it would take over Time Warner Inc. for an announced $187 billion. The largest announced takeover last month was Nestle SAs $11.9 billion purchase of Ralston Purina Group. In the United States, mergers and acquisitions dropped to $62.6 billion from $283.2 billion in January a year ago.
Walt Disney Co., the worlds second-largest media company, will be host to a gathering of analysts tomorrow to show off its newest theme park, as concerns build that a cooling economy may keep tourists away. The slowing economy already has hurt sales of advertising on Disneys TV networks, including ABC and ESPN, analysts said. The company is scheduled tomorrow morning to report earnings for its fiscal first quarter ending in December. The profit declined from a year earlier, analysts forecast. Disneys new California Adventure theme park, built at a cost of $1.4 billion, will open to the public Thursday.
Delta Air Lines, the nations third-largest carrier, and Continental Airlines reportedly have begun talks about a merger in which Continental would acquire the much larger Delta. The discussions are "very informal" and "in the very early stage," an industry source told The Washington Post on condition of anonymity. Neither Atlanta-based Delta nor Houston-based Continental, the fifth-largest carrier, would comment last night. Under a marketing agreement with Continental, Northwest Airlines retains veto power over any deal to acquire Continental. Northwest officials are confident they can block a merger even if Continental initiates it.
Philliphs Petroleum Co. will acquire Tosco Corp. for $7 billion in stock, creating the nations second-largest oil refiner and a gasoline retailer with more than 12,000 stations. The transaction was approved by the boards of both companies yesterday and is expected to be completed by the third quarter of 2001. Under terms of the deal, Phillips will assume approximately $2 billion in Tosco debt. Tosco has 6,400 gas stations in 32 states, operating under the brands "76" and Circle K, the nations No. 2 convenience store chain, and about 25,000 employees. Phillips has about 5,900 gas stations across the U.S. Neither has a presence in Hawaii.
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