Business & Finance
In a blockbuster deal valued at $35 billion, Bank of America announced it will buy independent credit-card issuer MBNA Corp. If regulators approve the cash and stock acquisition, it will propel Bank of America ahead of American Express among the world leaders in the payment- services industry, reports said. At the same time, it also will cost 6,000 employees their jobs as the buyer attempts to trim $850 million a year in operating expenses. MBNA's headquarters will remain in Wilmington, Del. Bank of America is based in Charlotte, N.C.
Three months after ousting its chief executive for ethical lapses, Boeing appointed James McNerney Jr. as his replacement. McNerney had said as recently as April that he wasn't a candidate to run the aerospace giant and did not plan to leave the top job at 3M Co. in Minneapolis. But his appointment won praise from industry analysts and Boeing's competitors alike, since he previously headed the jet engine division of General Electric. Boeing fired Harry Stonecipher as its chief in March after he admitted to an affair with a female employee.
Statoil ASA confirmed a published report that it will sell its half-ownership of plastics manufacturer Borealis for $1.75 billion to its partners: the government of Abu Dhabi and OMV AG, an Austrian energy supplier. Borealis, which is based in Copenhagen, Denmark, makes electrical and communications cable. Statoil is Norway's government-controlled oil and gas company.
Another 1,300 jobs will be cut by ABB Ltd., the world's largest builder of electrical transformers, its chief executive announced. The layoffs will come at plants in Europe, and production will be shifted to China and India, markets where the demand is growing rapidly. Over the past two years, the Swiss company has cut 45,000 jobs to help stave off bankruptcy because of its vulnerability to asbestos-related litigation.
Sony Corp., the consumer electronics manufacturer, said it will close one assembly plant in Wales and halt production of cathode ray tube TV sets at another by next March 31. The moves will result in the loss of 650 jobs. Citing a drop in demand for such sets, Sony also will stop making them at its Barcelona, Spain, facility by this autumn, focusing instead on flat-panel TVs.