Xerox in $6B deal to expand tech services business NEW YORK (AP) ¿ Xerox Corp. said Monday it will buy Affiliated Computer Services Inc. for about $6.4 billion in cash and stock, joining the expensive race among technology companies to broaden their offerings. Xerox said the deal will create a $22 billion business that combines Xerox's copiers, printers and document management services with the "business process outsourcing" of Dallas-based ACS. Outsourcers like ACS take on tasks for other companies, such as helping to manage payroll or run health care plans. With the drop in Xerox's share price, the deal was worth roughly $5.7 billion. ___ Abbott buys Solvay pharma operations for $6.6B NEW YORK (AP) ¿ Abbott Laboratories on Monday said it would pay $6.6 billion for the pharmaceutical business of Belgian chemicals maker Solvay in a move to further expand internationally and add to its product portfolio.
The deal is the latest in a string of drug mergers and acquisitions, and one of three announcements Monday that involved the fast-growing vaccines business. By purchasing Brussels-based Solvay, Abbott gains access to emerging markets in Eastern Europe and Asia along with new therapeutic areas, including hormone therapies and vaccines. ___ Xerox, Abbott deals boost stocks; Dow gains 124 NEW YORK (AP) ¿ A burst of corporate dealmaking is giving investors a shot of confidence about the economy. Stock indexes rose more than 1 percent Monday to post their biggest gains in about a month, breaking a three-day slide. The Dow Jones industrial average jumped 124 points, recouping much of what it lost last week. The Dow rose 124.17, or 1.3 percent, to 9,789.36, its biggest gain in more than a month. Large acquisitions from Abbott Laboratories and Xerox Corp. vaulted shares of drugmakers and technology companies higher, and the buying spread to other parts of the market as investors hoped that the $6 billion-plus deals could be a sign that deal activity is finally picking up a year after the financial system nearly froze.
___ FDIC expected to require banks to prepay fees WASHINGTON (AP) ¿ The Federal Deposit Insurance Corp. may take the unprecedented step of ordering banks to prepay about $36 billion in premiums to shore up the shrinking deposit insurance fund. The FDIC board likely will call for "prepaid" bank insurance premiums at its meeting Tuesday, three industry executives and a government official said. The banking industry prefers that option over a special emergency fee ¿ which would be the second this year. The officials spoke on condition of anonymity because the decision has yet to be made public. It would be the first time the FDIC has required prepaid insurance fees. Under the plan, banks would have to pay in advance their insurance premiums for 2010-2012, bringing in about $12 billion for each of the three years, two of the officials said. That is the normal amount of insurance fees, though it could vary somewhat according to growth in total insured deposits ¿ the basis for determining the fees. ___ Gas dips below $2.50 for first time in 2 months
UNDATED (AP) ¿ The average retail price for gasoline dipped below $2.50 a gallon for the first time in two months Monday as swelling oil supplies and slumping demand overshadowed even a fire at a major U.S. refinery. Friday's fire at a Tesoro refinery in Los Angeles, which processes roughly 100,000 barrels of crude oil a day into gasoline, jet fuel and other products, will likely lead to some higher pump prices in California, but the effect is muted elsewhere, said analyst and trader Stephen Schork. The average price for a gallon of regular gasoline nationwide was $2.499, the U.S. Energy Information Administration reported Monday. That's $1.13 below what drivers were paying at this time last year. ___ Ex-Enron broadband exec gets 16 months in prison HOUSTON (AP) ¿ The former chief executive of Enron Corp.'s failed Internet business was sentenced Monday to 16 months in prison for lying about the capabilities of the once mighty energy giant's broadband network in order to help pump up the company's stock price. The former broadband unit CEO also agreed to pay $8.7 million in restitution.
Joseph Hirko apologized for his actions before being sentenced. He had previously pleaded guilty to one count of wire fraud as part of a plea deal with federal prosecutors. ___ Zoellick advocates greater role for US Treasury WASHINGTON (AP) ¿ The president of the World Bank said Monday he opposes giving more authority to the U.S. Federal Reserve, arguing instead that the Treasury Department is better equipped to manage financial crises. Robert Zoellick also suggested in a speech that the dollar's role as a the world's reserve currency may be diminishing and the United States should recognize this fact. Zoellick, a former high-ranking U.S. government official and investment banker, said Treasury as a part of the executive branch of government would be subject to greater oversight by Congress and the American public if given additional authority. ___ Johnson & Johnson buys 18 percent stake in Crucell TRENTON, New Jersey (AP) ¿ Health care giant Johnson & Johnson is jumping into the increasingly hot vaccine business by taking an 18 percent stake in Dutch biotechnology company Crucell NV and focusing more on preventive medicine.
Under the deal the companies announced Monday, Johnson & Johnson is spending $440 million for new shares of Crucell in a deal focused initially on developing a universal vaccine or treatment against influenza from Crucell's genetically engineered antibody technology. A universal flu vaccine ¿ one that would work against all or most strains rather than having to be reformulated every flu season ¿ has been an elusive goal some other pharmaceutical companies have abandoned. Amid the swine flu pandemic, it has suddenly become a bit of a Holy Grail. ___ Ex-CEO of Pa. drinks-maker charged in $806M fraud PITTSBURGH (AP) ¿ A federal grand jury accused the former chief executive officer of a defunct soft-drink-maker and four others connected to the company of perpetrating an $806 million bank fraud, much of which went to the ex-CEO and his family. Gregory Podlucky, 48, of Ligonier, provided financial institutions and equipment suppliers "with dramatically false financial statements" to get equipment leases and loans for Latrobe-based Le-Nature's Inc., said U.S. Attorney Mary Beth Buchanan. She called the "largest fraud in the history of the Western District of Pennsylvania," a 25-county area.
According to the 29-count indictment unsealed Monday, lenders and investors poured money into the company on the basis of the phony financial statements.. ___ Star Tribune emerges from bankruptcy protection MINNEAPOLIS (AP) ¿ The Star Tribune emerged from bankruptcy protection Monday with its main lenders becoming the new owners and its debt slashed by 80 percent. Out from Chapter 11, the Star Tribune can now make decisions without a judge's supervision, as Minnesota's largest newspaper and the nation's 14th largest on weekdays tries to ride out an advertising drought and boost revenue in print and online. The move was largely expected after a federal bankruptcy judge in New York approved the Star Tribune's reorganization plan Sept. 17. The newspaper had filed for bankruptcy protection eight months earlier, saddled by debt from Avista Capital Partners' 2007 purchase of the newspaper from the McClatchy Co. By The Associated Press
The Dow rose 124.17, or 1.3 percent, to 9,789.36. The broader Standard & Poor's 500 index rose 18.60, or 1.8 percent, to 1,062.98, and the Nasdaq composite index rose 39.82, or 1.9 percent, to 2,130.74. Benchmark crude for November delivery rose 82 cents to settle at $66.84 a barrel. Gasoline for October delivery on Nymex rose 1.75 cents to settle at $1.638 a gallon. In other Nymex trading, heating oil gained 1.38 cents to settle at $1.6909 a gallon. In London, Brent crude rose 43 cents to settle at $65.54 on the ICE Futures exchange. Natural gas for November delivery fell 11.8 cents to settle at $4.83 per 1,000 cubic feet with some key storage facilities nearing capacity.