Business Highlights

AP News
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Posted: May 20, 2011 5:56 PM
Business Highlights

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Malone's Barnes & Noble bid a bet on the Nook

NEW YORK (AP) _ Why buy a bookstore?

John Malone, who made a fortune in cable television, is offering $1 billion for Barnes & Noble _ trying to jump into a company that's so sick that its No. 2 competitor, Borders Group Inc., is on life support.

The difference is that Malone and his Liberty Media conglomerate aren't betting on the brick-and-mortar store past, analysts say, but the promise of the electronic future.

Barnes & Noble's Nook electronic reader now accounts for 28 percent of the market for those devices. And the Nook has the potential to go beyond books to deliver all kinds of digital products; including music, magazines, TV shows and movies. That makes it a competitor not just to Amazon.com's Kindle but also to Apple's iPad.

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Prices at gas pump a pain for many Americans

WASHINGTON (AP) _ With gasoline still close to $4 a gallon across the country, drivers have made some tough choices: scaling back vacations, driving less or ditching the car altogether. A new Associated Press-GfK poll shows the impact of sustained high prices is spreading among seniors and higher-income Americans.

According to the poll, the share of all Americans who say increases in the price of gasoline will cause serious financial hardship for them or their families in the next six months now tops 4 in 10.

Overall, 71 percent said rising prices will cause some hardship for them and their families. 41 percent call it a "serious" hardship. Just 29 percent said rising gas prices are not negatively impacting their finances.

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European support rising for Lagarde's IMF bid

PARIS (AP) _ France's frank, hard-working and chic finance minister, Christine Lagarde, emerged Friday as Europe's likely choice to lead the International Monetary Fund.

The IMF insists the departure of former chief Dominique Strauss-Kahn has not hurt its day-to-day operations, but it is clearly under pressure to find a successor fast to lead an organization that provides billions in loans to stabilize the world economy. A new chief would also draw attention away from the scandal surrounding Strauss-Kahn, who quit this week to face charges in New York that he tried to rape a hotel maid.

The 24-member executive board, which will pick Strauss-Kahn's successor, held a preliminary discussion on Friday at the IMF's headquarters in Washington. But IMF officials gave no indication when a decision might be made.

Lagarde's chances for the top IMF job got a boost Friday when Kemal Dervis, a former finance minister for Turkey, said he did not want to be considered for the position.

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JP Morgan Chase CEO warns of US defaulting

DENVER (AP) _ It would be a "moral disaster" if the U.S. were to default on its debts and was unable to pay its obligations, JPMorgan Chase & Co. CEO Jamie Dimon said at an appearance in Colorado Thursday evening.

The U.S. is the financial linchpin of the world, and the economic effects of the U.S. defaulting could be "potentially catastrophic," he said at a dinner for the University of Colorado Denver Business School.

"It will dwarf Lehman," Dimon said, referring to the 2008 collapse of the investment bank Lehman Brothers, which contributed to the beginning of a global financial crisis.

Dimon's comments came in response to a question about the federal deficit from moderator Tom Petrie, a vice chairman of Bank of America Merrill Lynch.

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Unemployment falls in three-quarters of US states

WASHINGTON (AP) _ Unemployment rates fell last month in more than three-quarters of the nation's states, adding to evidence that companies are feeling more confident in the U.S. economy.

The Labor Department said Friday that jobless rates dropped in 39 states in April. It's the largest number of states to see decreases since November 2003. Rates rose in three states and the District of Columbia. They were unchanged in eight states.

Employers added workers in 42 states, the best showing since March 2007 _ nine months before the recession started. Only eight states and the District of Columbia lost jobs last month.

Nationally, businesses have added more than 250,000 jobs per month, on average, in the past three months. It's the fastest hiring spree in five years. The unemployment rate has dropped nearly a full percentage point since November. Still, it remains very high at 9 percent.

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Government examining airline ticket distribution

DALLAS (AP) _ The government is investigating whether companies that distribute airline flight and fare information are stifling competition and violating federal antitrust laws.

The Justice Department confirmed the investigation Friday after several airlines and two leading ticket information-distribution companies said they received letters from antitrust officials.

This is the latest twist in an escalating fight between airlines and so-called global distribution systems over how air travel is sold, especially to lucrative corporate accounts. Many consumers buy tickets online directly from the airlines, but corporations often use travel agencies that get information about flights and fares from the three big distribution companies.

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BP gets $1 bln settlement from Gulf well partner

LONDON (AP) _ BP has struck a deal to receive around $1 billion from one of its minority partners in the blown-out Gulf of Mexico well, raising hopes it will successfully pursue other companies involved and reduce its bill for the disaster.

BP PLC said Thursday that MOEX Offshore 2007 LLC, which had a 10 percent interest in the Macondo well, has agreed to pay $1.065 billion to settle all claims between the companies over the accident on the Deepwater Horizon rig.

Under the settlement, MOEX, a unit of Japanese trading house Mitsui & Co., agreed to recognize findings by the U.S. Presidential Commission that the accident "was the result of a number of separate risk factors, oversights and outright mistakes by multiple parties and a number of causes."

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Fila takes swing at golf biz with Titleist buy

The company behind Fila shoes and clothing is taking a swing at golf, forming a foursome to purchase the maker of Titleist golf balls and FootJoy shoes from liquor company Fortune Brands Inc.

Korean investors led by athletic company Fila Korea Ltd. and Mirae Asset Private Equity plan to buy Fortune's golf giant Acushnet Co. for $1.2 billion. The purchasing group also includes the National Pension Service of Korea and Korea Development Bank.

Titleist is the top-selling golf ball and a leader in golf clubs, while the unit's FootJoy brand is a leader in golf shoes and also makes golf gloves and jackets, Fortune said.

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Skype cancels IPO to clear way for Microsoft sale

SAN FRANCISCO (AP) _ Internet calling service Skype has cancelled its IPO now that it's agreed to be sold to Microsoft for $8.5 billion.

Skype served notice that it was withdrawing its initial public offering of stock in a Friday filing with regulators.

The IPO became moot last week after Skype accepted Microsoft's takeover offer. Skype, currently owned by investment funds and eBay, filed its plans to go public last August.

Microsoft Corp. hopes to complete the Skype purchase by year-end. It will be the most expensive acquisition in Microsoft's 36-year history.

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By The Associated Press(equals)

The Dow Jones industrial average fell 93.28 points, or 0.7 percent, to 12,512.04. The Standard & Poor's 500 index lost 10.33, or 0.8 percent, at 1,333.27. The Nasdaq composite dropped 19.99, or 0.7 percent, to 2,803.32. Each market index fell by more than 0.3 percent for the week. The Nasdaq lost the most, 0.9 percent.

Benchmark crude for June delivery rose $1.05 to settle at $99.49 per barrel. Friday was the final day for the June contract on the New York Mercantile Exchange, and most of the trading shifted to the July contract, which rose $1.17 to settle at $100.10 per barrel.

In other Nymex trading for June contracts, heating oil gained 2.36 cents to settle at $2.9183 per gallon and gasoline futures added less than 1 cent to settle at $2.9358 per gallon. Natural gas futures added 12.9 cents to settle at $4.290 per 1,000 cubic feet.

In London, Brent crude rose 97 cents to settle at $112.39 on the ICE Futures exchange.