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May 26, 2005
Kyl Says Progress on Asbestos Being Made
Senate Judiciary Chairman Arlen Specter (R–Pa.) has been
working to secure several more votes in favor of the asbestos bill, in
the hopes of clearing it through the committee today on a bipartisan
vote, CongressDaily reported. Sen. Jon Kyl (R–Ariz.)
emerged from a meeting yesterday with Specter and Judiciary ranking
member Patrick Leahy (D–Vt.) saying they were making progress on
the bill. But Kyl, who has worried about the “startup phase”
of a proposed asbestos trust fund and about steps the government could
take to ensure the fund does not run dry, did not say he planned to vote
for the bill. “We have a conceptual agreement on some additional
refinements to the bill, primarily on the startup,” he said. But
his “aye” vote “depends on how it gets put
together,” he said. Five Republicans and two Democrats already are
likely to vote for the bill, and Specter has been working to secure
three more votes for the legislation, which is the subject of a markup
session today.
Snow Signals Interest in Expanding Use of 401(k) Plans
The Bush administration approved yesterday the concept of increasing
the use of 401(k)s by having employers enroll workers in the plans by
default with an opt-out clause, CongressDailyreported.
“I think the opt-out option has a lot of appeal to it,”
Treasury Secretary John Snow said. Snow said he thought corporations
would “naturally” move toward the opt-out regime.
“Corporations take an interest in the well-being of their
employees,” Snow said. “The lament of CEOs and CFOs and
subsidiary company presidents and so on is that the 401(k)s don’t
get better utilized.”
Calpine Selling Plants to Cut Debt Load
Calpine Corp., struggling under a heavy debt load since the Enron
crisis of 2001, on Wednesday accelerated its $3 billion debt-reduction
plan and signaled it may sell up to eight more power plants in a bid to
improve its balance sheet, Reuters reported. Calpine, which was recently
forced to deny rumors it was on the brink of bankruptcy, also said it
will mothball underperforming plants, sever some costly maintenance
agreements and attempt to reduce losses at its plants during off-peak
hours. In addition to the debt reduction, the company aims to reduce
operating costs by $200 million annually and achieve $275 million in
annual interest savings.
Diverse Mix of Investors in Airline Deal
When America West and US Airways outlined the financing for their
$1.5 billion merger last week, it turned out that two of their lead
investors were hedge funds—both with a relationship to the airline
industry, the New York Times reported. Read the full
article at www.nytimes.com
(registration required).
Scrushy Trial Judge Urges Jury to Press On
A federal judge overseeing the fraud trial of former HealthSouth
Corp. leader Richard M. Scrushy yesterday gave jurors detailed
instructions about a conspiracy charge filed against Scrushy and told
the jury she hoped they “will continue to work hard to reach a
unanimous decision,” the Washington Post reported.
U.S. District Judge Karon O. Bowdre was responding to two notes jurors
sent on Tuesday in which they said, “We cannot unanimously agree
on a verdict,” and cited inconsistencies in the jury instructions
and the verdict form they were given last week.
Hedge Funds Nip at Wall Street
Hedge funds have generally been associated with short-term trading of
public securities, the Wall Street Journal reported. But
more often lately, some of the biggest are lending money, often for many
years. In so doing, they are taking a cut of Wall Street’s core
business of providing financing for takeovers, rescues and
bankruptcy-protection proceedings. Quietly, the hedge funds have become
not only Wall Street’s best clients but also its most ferocious
competitors. Read the full article at
href='http://www.wsj.com/'>www.wsj.com (subscription required).
Ford to Pay up to $1.8 Billion on Visteon
Ford Motor Co. said it agreed to a bailout of struggling former parts
unit Visteon Corp., under which it will take back 24 Visteon plants and
17,400 workers and spend a total of $1.6 billion to $1.8 billion to help
Visteon restructure into a smaller company with less U.S. production and
more diverse customers, the Wall Street Journal reported.
The agreement, if finalized, would avert a financial crisis at Visteon
and give the auto-parts maker a new start as a more focused company with
a lower-cost manufacturing base.
ABB to Present Final Asbestos Plan in U.S. in June
Swiss-based engineering group ABB will present its final asbestos
settlement plan to a U.S. Bankruptcy Court on June 13, Reuters reported.
“We hope to complete the proceedings by the end of the
year,” an ABB spokesman said today, adding that the company would
submit the reworked asbestos settlement plan to a bankruptcy court in
Pittsburgh for approval next month. “This is clearly good news
toward a final solution to the asbestos issue,” Lombard Odier
Darier Hentsch said in a note, the newswire reported.
Northwest Says Mechanics Talks Stalled
Northwest Airlines Corp. considers its seven months of contract talks
with mechanics at an impasse and wants a federal mediator to release the
company from further negotiations, the Associated Press reported. The
mechanics have until June 8 to respond to Northwest’s request to
release them from mediation. Arbitration would be next, but either side
can refuse. That would prompt a 30-day cooling-off period. After that,
the mechanics could strike, the newswire reported.
ATA, Union Reach Tentative Deal on Wages
ATA Airlines and pilots union officials have reached a tentative
agreement to extend wage concessions to help the bankrupt airline stay
in business, the Associated Press reported. Union members have yet to
vote on the proposal, which the company announced on Wednesday. ATA
Pilot Erik Engdahl, who heads the Air Line Pilots Association local
representing ATA’s 900 pilots, confirmed the agreement. In its
statement, ATA said the deal would extend for four months the
concessions approved by pilots in February. The deal also includes a
timeframe for negotiations on a long-term agreement, the statement
said.