In The News:
On Monday, Toyota announced, after more than a half-century, it will move its U.S. headquarters from Southern California to Texas. The move to Plano, Texas will start in 2017. The new office complex will bring together employees who are scattered around the U.S. Currently, Toyota’s sales and finance arms are headquartered in California, while its manufacturing and development arms are headquartered in Kentucky, with additional offices in New York City.
Shelvin’ The Plan…
The second-largest U.S. bank by assets announced Monday that it discovered a mistake in certain figures submitted earlier this month to the Federal Reserve as part of its annual stress test. The error leaves Bank of America (BOA) with $4 billion less in capital than it originally thought or reported. The bank has been making the same calculation error, an apparent communications blunder, since 2009. The issue has forced Bank of America to shelve a plan to buy back shares and boost its dividend for the first time since 2008. Who knew a bank could have issues balancing its checkbook.
Energy Future Holdings Corp., aka TXU Corp, filed for Chapter 11 bankruptcy Tuesday, after months of negotiations with creditors aimed at speeding the restructuring of the private-equity backed utility’s debt load of more than $40 billion. The company sought bankruptcy protection from the U.S. Bankruptcy Court in Wilmington, Delaware as more than $100 million in skipped debt payment comes due this week. The company’s bankruptcy plan includes swapping shares of Texas Competitive Electric Holdings, a subsidiary which sells power in the wholesale markets to big companies and other utilities, in return for $25 billion worth of debt forgiven. Additional, the company is discussion with bondholders to convert roughly $ 1.7 billion in debt to ownership stakes in Energy Future Intermediate Holding Company, TXU’s subsidiary that owns Oncor, which delivers power to more than 10 million customers across Texas.
The Dallas-based power company now at the center of one of the biggest bankruptcies on record was, in 2007, at the center of the biggest private-equity leveraged buyout on record. The deal, which involved private equity groups KKR & Co, TPG, and Goldman Sachs, added $32 billion to the debt load of what was then called TXU Corp went south as natural gas prices fell.
In The Markets:
Asian shares closed mixed on Tuesday with Japanese markets closed for a public holiday. Caution set in for investors as both the US and Europe slapped more severe sanctions on Russia.
European shares closed higher Monday. Markets were boosted by mergers and acquisitions activity, although bullish sentiment was capped by ongoing events in Ukraine.
US markets closed mixed on Monday after a volatile trading session where the NASDAQ rebounded from more than 1% drop. Investor turned to large-cap companies while tracking development in the Ukraine. DJIA: +87.28 16448.74 S&P: +6.03 1869.43 NASDAQ: -1.16 4074.00
In Dinner or Drink:
1/2 oz. Irish cream
1/2 oz. Goldschlager® cinnamon schnapps
1/3 oz. Jagermeister® herbal liqueur
1/3 oz. Rumple Minze® peppermint liqueur
Combine all ingredients into a shot glass and slam it.
The tragedy in life doesn’t lie in not reaching your goal. The tragedy lies in having no goal to reach. – Benjamin E. Mays