Entries Tagged 'Business News' ↓

Pfizer offered Wyeth a 15% premium for its shares in this deal worth $68 Billion. That’s billion, with a “B.” Pfizer has to borrow $22.5B from a huge clump of banks in order to finance the deal. This comes after Pfizer announced a 90% drop in quarterly net profit. They claim part of the problem is a $2.3B charge associated with allegations they promoted Bextra for uses not approved through the FDA. Like Vioxx, Bextra was yanked from the market.

Giant mergers have seemed to fall out of favor lately. The last big one was BellSouth and AT&T back in 2006, which I think was a $67B deal. AT&T turned around after that merger and fired a slew of people. That is really part of what helps push mergers this large, the idea that the synergy between the merging companies will allow for a reduction in manpower and a net savings. It does not often work in the long-term. Just look at Sears and K-Mart.

After 70 years of tearing up the world with efficiency, sensibility, and the Toyota Production System, Toyota for the first time ever has forecast an operating loss. Sounds bleak, but don’t forget they sold 7 million cars worldwide in the first 9 months of the year.

Toyota has a “zero layoffs” policy, which they embrace in an attempt to foster stability for employees, sometimes even to the detriment of the company’s bottom line.

The operating loss is expected to be $1.66billion, which compares to an operating profit fo $25.2 billion from a year ago.

To prepare for long-term growth, Toyota says they will invest in small cars and environmentally friendly technologies. Good luck to them, investing in R&D while business is down requires a ton of discipline.

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