Business & Finance
Boeing Co. selected General Electric and Rolls Royce to build the jet engines for its planned 7E7 Dreamliner airplane, a partnership that industry analysts projected could be worth as much as $40 billion to the two subcontractors. The 200-passenger 7E7s will replace Boeing's older 757s and 767s and are expected to begin flying in 2008. Boeing has said it will price the fuel-efficient planes at about $120 million each, which is expected to make them a big seller. The analysts also said the announcement by Boeing was a blow to the industry's No. 3 enginemaker, Pratt & Whitney, which had called the contract its "best chance for a renaissance."
Kerr-McGee Corp., a major oil and gas exploration company, said it will acquire rival Westport Resources Corp. for $2.49 billion in stock and assumption of debt. Westport, based in Denver, has extensive natural gas reserves in the Rocky Mountain region. The deal is expected to boost Kerr-McGee's daily production volume by more than 34 percent, making the combined company one of the industry's largest. Kerr-McGee is based in Oklahoma City.
Bankrupt Spiegel Group said it is looking for a new buyer for its Eddie Bauer subsidiary, since negotiations with a major stockholder to retain control of the company fell through. Few details of the talks with German billionaire Michael Otto were available, but they appeared to center on differences with creditors. Otto's family owns 89 percent of Spiegel's voting shares. Analysts speculated that the Bauer outdoor-wear chain might be attractive to potential buyers mainly for the real-estate value of its stores. Between its 440 outlets and its catalog and online sales, Eddie Bauer generated $1.3 billion of the company's $1.77 billion in net revenue last year. Spiegel of Downers Grove, Ill., once was the nation's leading direct retailer, but it filed for Chapter 11 protection in March 2003.
A major downsizing that will cost 1,500 employees their jobs was announced by NTL Inc., Britain's largest cable-TV system. Over the next 18 months, the company said, it will cut its call centers from 13 to 3 - one each in England, Scotland, and Wales. NTL said it projects a cost saving of $55 million a year as a result of the campaign.