Airlines: Fares for Summer Travel Rise
The recovering economy has more Americans gearing up for vacations, allowing carriers such as Delta Air Lines and US Airways to raise fares on summer travel. The number of bookings for trips in June through August is up 4.3 percent from a year ago, while prices advanced 3.1 percent. Airlines have cut capacity over the past several years to trim costs, so now they can fill planes to near-record levels and raise fares during high travel periods. The carriers may continue to limit the number of available seats for some time. Southwest Airlines curbed its expansion plans recently by delaying the delivery of 30 Boeing 737-800 jets for four years.
PetroChina: Looking to Expand in the Americas
PetroChina, the mainland’s biggest oil and natural gas producer, says it’s looking at refining and storage assets in the Americas and the Caribbean and expects to set up trading operations in the Western Hemisphere. The company is weighing the purchase of a refinery in Aruba owned by Valero Energy. In 2010 the Chinese state-owned company said it planned to invest at least $60 billion this decade on acquisitions. The company wants half of its oil and gas production to come from overseas, up from just more than a quarter now.
Houghton Mifflin Harcourt: A Prepackaged Bankruptcy
Houghton Mifflin Harcourt, which published authors from Mark Twain to J.R.R. Tolkien, filed for bankruptcy protection on May 21 to shed more than $3 billion in debt. It has a prepackaged plan backed by creditors and won conditional permission to borrow $400 million to fund operations during a 30-day reorganization. Under the proposed workout, Houghton’s bank and bond creditors will be paid off with stock in the reorganized company plus $30 million in cash.
BAE Systems: Wins a $2.5 Billion Contract
BAE Systems won a contract valued at $2.5 billion from Saudi Arabia’s Royal Air Force, underscoring the role of Middle East customers in the arms market as western European governments reduce defense spending. BAE will supply equipment for training air crews, including 22 Hawk Advanced Jet Trainer aircraft and 55 Pilatus PC-21s. The defense manufacturer had planned to close a factory in the northern England town of Brough, but the new orders will keep its doors open until at least 2015.
Eastman Kodak: Losing a Patent Ruling
Eastman Kodak lost a ruling in a two-year legal fight against Apple and Research In Motion over a patent for digital image-preview technology, a decision that may hurt the value of assets Kodak is selling in its Chapter 11 proceeding that began in January. A judge ruled that Kodak’s original patent was invalid because of its “obviousness.” Kodak, which plans to appeal the findings, has been trying to charge for the use of its digital-imaging patents and suing in instances where that strategy failed.
On the Move
— Rosneft: Russian Prime Minister Dmitry Medvedev tapped Igor Sechin as CEO
— Dexia: Isabelle Bouillot and Francis Vermeiren resign in board shuffle
— General Motors: Alan Batey named vice president of U.S. sales and service