The Last 24 Hours
A federal appeals court restored BP’s claims over a judge’s interpretation of a settlement of its 2010 oil spill in the Gulf of Mexico, sparing the petroleum giant from incurring a payout for millions of dollars. That argument won sympathy from a 2-1 panel majority panel that sent the case back to U.S. district judge Carl Barbier, who also sits in New Orleans. As per the original estimates by BP, the settlement was projected to cost $7.8 billion, but in July it increased its estimate to $9.6 billion. BP spokesman expressed his satisfaction over the court verdict maintaining that, claimants should not be paid for fictitious or wholly non-existent losses.
The New York Attorney General’s Office has sued Wells Fargo bank for non-compliance with the national mortgage settlement plan, worth $25 billion. The inability of Wells Fargo to modify its customer service practices and failure to provide timely loans to the struggling borrowers, prompted the New York Attorney General to take the decision. According to the claims in the lawsuit the bank should be made liable for $5.9 billion in cash payments to the people who have lost their homes and spend another $19.1 billion as a part of loan restructuring.
BlackBerry has drawn the interest of Cerberus Capital Management LP, which is potentially planning an alternate buyout of the smartphone maker. Fairfax Holdings, Blackberry’s largest shareholders, have already offered $9 per share for the company. Cerberus intends to sign a confidentiality agreement with BlackBerry that would allow it to gain the access to private financial information. Blackberry, in August announced that it is planning to restructure its business after witnessing sharp decline in market share. However, according the Wall Street Journal, a Blackberry spokesperson refused to divulge further details of the proposed deal until a significant move is made by Cerberus. Blackberry’s shares responded positively to the news, moving up by 4 cents to $7.96.
The booming shale gas production has moved the US to the world’s largest producer of oil and gas, surpassing Russia. As per the EIA and the International Energy Agency reports, the U.S. pumped about 22 million barrels a day of oil and natural gas in July 2013, surpassing Russia’s 21.8 million barrels a day. For the first time since 1982, the natural gas production in the US is more than that of Russia (then USSR). The US dependency on global crude oil and natural gas has reduced over 32% and 15%, respectively, in the past five years, reducing its trade deficit.
The 23-member ECB governing council refrained from any further cut in interest rates for the fifth month in a row. At present, the ECB’s main benchmark rate stands at a record low 0.5%. However, European Central Bank President Mario Draghi advocated for low interest rates. He indicated that rates might be lowered in the event of further decrease in annual inflation rate, to maneuver the recession battered Eurozone economy from high unemployment and low growth rates.
Cargill Inc. is set to acquire Archer Daniels Midland Co.’s Cocoa unit for $2 billion. Cargill and ADM are among the world’s top cocoa merchants and bean grinders. The deal will be the second major buyout in the chocolate industry. Recently, Barry Callebaut acquired the cocoa ingredients division of Petra Foods for $860 million. The sudden rise in buyouts in the industry by the sector leaders is being seen as a major threat to smaller players in the market.