Amtrak's hopes for continued federal funding were dealt a potentially serious blow with the indefinite suspension of high-speed Acela service due to mechanical problems. The announcement Friday came with the Senate about to debate continued Amtrak subsidies. Hairline cracks discovered in the brakes of Acela cars could take up to two months to repair, a company spokesman said. Acela accounts for 20 percent of Amtrak's business along the Boston-Washington corridor.
Five thousand people lost their jobs and may collect only a fraction of their pensions after the collapse Friday of MG Rover. As many as 15,000 employees of companies that supplied parts and other materials to Britain's last remaining automaker also awaited word on their fate despite the promise of a $282 million emergency aid package by Prime Minister Tony Blair's government. Blair also ordered an investigation into MG Rover's finances amid reports that its debts and pension liabilities amount to at least $1.9 billion and are expected to rise far higher. Only 1,000 employees will be kept on to complete production of cars still on the assembly line, at the engine/powertrain operation, and at MG's sport racing division.
Dynegy, a leading wholesaler of electricity and natural gas, agreed to pay $468 million to settle a class-action lawsuit brought by shareholders over its accounting practices. The company is based in Houston.
Brookstone Inc., a retail chain known for selling high-end tools and gadgets, agreed to be acquired by an investment group consisting of JW Childs Associates of Boston and two Singapore entities, OSIM International and Temasek Holdings Ltd. The Merrimack, N.H., company operates 288 stores in 39 states and Puerto Rico. The new owners said they intend to expand globally, primarily in Asia.
In other layoff news:
• The Littlewoods retail group announced it will close 126 of its money-losing Index catalog stores in Britain, resulting in the loss of as many as 3,200 jobs.
• At least another 1,100 jobs will be cut by Deutsche Bundesbank, the central bank of Germany, it announced. Last year, the restructuring bank said it needed to reduce its payroll from 15,834 to 11,100. Now, an official said, it will be cut to fewer than 10,000.
• MetLife bowed to pressure from Connecticut Gov. Jodi Rell (R) and said it would cut fewer jobs than planned at Traveler's Life & Annuity, the Hartford rival it is in the process of acquiring. MetLife said Friday it will eliminate 390 positions rather than 600, as previously announced.