The Star Online: Business
The Star Online: Business |
- Samsung to contest US verdict in favour of Apple (Updates)
- Business spending plans hint at factory weakness
- Best Buy founder calls on Wall Street to pressure board
| Samsung to contest US verdict in favour of Apple (Updates) Posted: 24 Aug 2012 10:10 PM PDT SEOUL: South Korea's Samsung Electronics said Saturday it will contest a US court ruling that it must pay rival technology giant Apple damages of more than $1 billion for patent violations. "We will move immediately to file post-verdict motions to overturn this decision in this court and if we are not successful, we will appeal this decision to the Court of Appeals," Samsung said. The statement came just hours after a jury in San Jose, California awarded Apple $1.05 billion for infringement of patents for its iconic iPhone and iPad, while rejecting Samsung's counterclaims of infringement of wireless patents. The decision appeared to be an overwhelming victory for Apple, but it was not immediately clear whether it would halt sales of Samsung devices or affect newer models released since the case was filed. Samsung in an earlier statement said the verdict was "a loss" for consumers and that Apple had "manipulated" the patent system. The South Korean firm also said the verdict was "not the final word" in this case or other similar battles around the world. "It will lead to fewer choices, less innovation, and potentially higher prices," it said. "It is unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners, or technology that is being improved every day by Samsung and other companies." - AFP Earlier Report: |
| Business spending plans hint at factory weakness Posted: 24 Aug 2012 06:50 PM PDT WASHINGTON: U.S. businesses cut back on their spending plans for a second straight month in July, suggesting slower growth ahead for the factory sector. The data from the Commerce Department on Friday underscored the toll on the U.S. economy from the uncertainty spawned by the possibility of tighter fiscal policy next year and the debt crisis in Europe. It led some economists to consider ratcheting back forecasts for economic growth and spurred traders to ramp up bets on further monetary stimulus from the Federal Reserve. "We are looking at a very soft trend in capital spending in the coming months," said Millan Mulraine, senior economist at TD Securities in New York. "Until we get some clarity on the fiscal outlook and the situation in Europe, the recovery is unlikely to gain the kind of traction needed to make it self-sustaining." Non-defense capital goods orders excluding aircraft, a closely watched proxy for business investment plans, declined 3.4 percent after falling by a revised 2.7 percent in June. Economists polled by Reuters had expected a 0.7 percent rise after a previously reported 1.7 percent decline in June. The weakness in the business spending gauge was in keeping with regional manufacturing surveys showing a cooler growth pace of activity in a sector that has shouldered the economy's recovery from the 2007-09 recession. The softness, which was also evident in shipments, could favor additional monetary easing by the Fed next month, even though other data on jobs, consumer spending and the housing sector suggested a bit of improvement in the economy early in the third quarter. "Firms seem very nervous about committing to investment projects at the moment," said Jeremy Lawson, senior economist at BNP Paribas in New York. "If they (Fed officials) look at this report, they will be concerned about the investment outlook." In a letter to a congressional oversight panel obtained by Reuters on Friday, Fed Chairman Ben Bernanke said the U.S. central bank had room to ease policy further to boost the economy. Hopes of more action by the Fed and news the European Central Bank was considering setting targets in a new bond-buying program that could help contain euro-zone borrowing costs helped U.S. stocks to end higher. Prices for U.S. Treasury debt were little changed, while the dollar rose against a basket of currencies. Shipments of non-defense capital goods excluding aircraft, used to calculate equipment and software spending in the gross domestic product report, were flat after rising 1.5 percent in June. Unfilled orders of these so-called core capital goods fell by the most since August 2009, suggesting little need for factories to step up production for these items. AIRCRAFT BOOST DURABLES ORDERS Minutes of the Fed's July 31-August 1 meeting released on Wednesday suggested further monetary stimulus could come soon unless economic data pointed to a "substantial" and "sustainable" strengthening in the pace of the recovery. Fed officials meet on September 12-13, and investors will look to a speech by Bernanke at the central bank's high-profile gathering in Jackson Hole, Wyoming, at the end of next week for clues on the monetary policy course. While businesses largely pulled back their horns in July, strong demand for civilian aircraft lifted overall orders for durable goods by 4.2 percent after a 1.6 percent increase in June. Last month's increase was the largest since December and beat economists' expectations for a 2.4 percent rise. Durable goods are items from toasters to tanks that are meant to last at least three years. Orders excluding transportation fell 0.4 percent, the second straight monthly decline. Orders for transportation equipment jumped 14.1 percent, with demand for civilian aircraft surging 53.9 percent. Boeing received orders for 260 aircraft, up from 24 planes in June, according to information posted on the planemaker's website. United Airlines placed an order for 150 planes last month. Motors vehicles orders were also strong, rising by 12.8 percent, the most since July last year. Away from transportation, there were gains in new orders for primary metals, computers and electronic products. But new orders for fabricated metal products, electrical equipment and appliances and machinery fell. While unfilled orders for core capital goods fell, the backlog for durable goods overall increased 0.8 percent due to the strong demand for aircraft. The inventory of unsold durable goods increased 0.7 percent. "Statistically, faster inventory growth may be a plus for GDP growth in the third quarter," said Michelle Girard, a senior economist at RBS in Stamford, Connecticut. "However, the combination of lower orders and rising stockpiles does not bode well for future production." - Reuters |
| Best Buy founder calls on Wall Street to pressure board Posted: 24 Aug 2012 06:47 PM PDT NEW YORK: Best Buy founder Richard Schulze has reached out to some of the retailer's top shareholders and Wall Street analysts, hoping they will press the company to allow his up to $8.8 billion buyout proposal to move forward, sources familiar with the matter said. Schulze's advisers at investment bank Credit Suisse and law firm Shearman & Sterling LLP have reached out to investors including Putnam Investment Management LLC and Fidelity Management & Research Co, the sources said. Putnam and Fidelity account for 11 percent of Best Buy. Schulze's team has also reached out to at least half a dozen analysts who publish research about Minnesota-based Best Buy, the sources said. The tactic comes as Schulze's team resumed negotiations with the world's largest consumer electronics chain, after talks broke down last weekend, other sources familiar with the situation said. The company, Schulze's advisers and a representative for the former Best Buy chairman declined comment, as did the two investors. Schulze, who owns 20.1 percent of Best Buy, needs the board's approval before he can make a formal bid. A Minnesota anti-takeover law prevents shareholders from launching a bid for a company for four years if they accumulate a stake without prior board approval. That means Schulze cannot form a buyout group with private equity firms or firm up financing for a potential bid until the board gives a go-ahead. Moreover, sources have said private equity firms want to be able to do due diligence on the company - which is struggling against competition from rivals such as Amazon.com Inc and Wal-Mart Stores Inc - before they commit to a buyout bid along with Schulze. At this stage, Schulze's team is pitching analysts and shareholders to put pressure on the company to at least open its books to them, so that they can put together a firm bid for the retailer. But some of the analysts who met with Schulze's advisers were still hoping for more details of his plan. One analyst who spoke with Schulze's advisers said he was not given "any granularity on how they plan to get the deal done." These analysts said they believed it was hard for anyone to buy Best Buy. The company hired a new CEO on Monday and the board may want to first give him time to craft a turnaround strategy. Best Buy investors "are skeptical about a deal getting done," said Wedbush analyst Michael Pachter, who decided against taking a meeting with Schulze's advisers. But dismal quarterly results from Best Buy earlier this week could also add credence to Schulze's argument that value is eroding by the day. Two analysts said Schulze's original proposal of $24 to $26 a share for Best Buy could be more palatable now to investors. Best Buy's shares closed down 3.9 percent at $17.31 on Friday. - Reuters |
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