Sprott Resource considers sale of Waseca oil unit
* Says value of oil and gas properties has tripledTORONTO, Oct 18 (Reuters) - Sprott Resource Corp
said on Tuesday it was exploring a sale of Waseca Energy Inc, a
81 percent owned oil subsidiary that has tripled the value of
its oil and gas properties since the end of 2010.Sprott, which invests and operates through subsidiaries in
the natural resources sector, said a sale of the unit was one
of a range of alternatives being considered under a strategic
review.”This process could result in a sale of Waseca, a sale of a
material portion of the Waseca’s assets, or a corporate
reorganization among other alternatives,” the company said in a
statement.Waseca Chief Executive Michael Watson said the net present
value of the company’s oil and gas properties had grown from
C$108.9 million at the end of 2010 to C$333.9 million at the
end of last month. In the same period, oil production rose from
1,050 barrels a day to 3,000 bbl/d.Waseca explores for and develop heavy oil resources in the
Lloydminster area of Canada in central Alberta and
Saskatchewan.Sprott Resource first invested in the company in January
2010 and has total investment in the company of C$44.2
million.Waseca has retained RBC Rundle, a division of RBC Capital
Markets, to assist with the process. Sprott said there were no
guarantees the process would result in a transaction.
UPDATE 2-Dodgers’ McCourts settle divorce, back media sale
* Club filed for bankruptcy in JuneOct 17 (Reuters) - Los Angeles Dodgers owner Frank McCourt
and Jamie McCourt said on Monday they settled their divorce
case, putting an end to a feud that had further complicated the
Major League Baseball team’s bankruptcy proceedings.Jamie McCourt, who had opposed the proposed sale of the
Dodgers’ media rights, will now support the process, according
to a joint statement.The club, which filed for bankruptcy in June, wants to hold
an auction of its broadcast rights, saying this can help
refinance the team. That would also enable Frank McCourt to
hold onto the team after the bankruptcy.In addition to Jamie McCourt, Major League Baseball has
fought Frank McCourt’s plan for the team and opposed the
auction, disputing the team’s need for bankruptcy and
questioning McCourt’s spending. The league, which took over the
team’s finances in the spring, has also launched a legal battle
to control the bankruptcy process.Fox Sports, which holds the media rights for the team until
November 2012 under its current contract, has also opposed the
TV rights auction.A tussle for control of the Dodgers has been going on since
the couple began heading for divorce. A judge ruled late last
year that the team was owned jointly by the couple, shooting
down arguments by newly divorced Frank McCourt that the team
belonged to him based on a post-nuptial agreement they signed.As the legal battle for control continued, Jamie McCourt in
May asked a judge to order the immediate sale of the franchise,
accusing Frank McCourt of mismanagement. Frank McCourt put the
team into bankruptcy the next month, saying it had run out of
cash.Frank McCourt has owned the team for seven years and during
that time developed a reputation for high spending. The couple
purchased multiple homes, flew private planes and ran up their
personal debts.McCourt, who was primarily a real estate developer at the
time, bought the team in 2004 for $430 million, mostly in debt
from Fox Entertainment Group, a division of News Corp .Bankruptcy court enabled the Dodgers to break that Fox
contract and now the Dodgers expect the media rights auction to
bring in offers from other broadcasters or cable companies.The case is in Re: Los Angeles Dodgers LLC, U.S. Bankruptcy
Court, District of Delaware, No. 11-12010.A spokeswoman of the Dodgers declined to comment. Major
League Baseball was not immediately available to comment.
Obama administration pulls part of healthcare law
U.S. health officials said on Friday that after 19 months of analysis, they could not come up with a model for the so-called CLASS Act that keeps it voluntary and budget-neutral.”We do not have a path to move forward,” Kathy Greenlee, assistant secretary of aging from the Health and Human Services department and administrator of the program, said in a call with reporters.”Everything we do to make the program more (financially) sound moves us away from the law, and increases the legal risk of the program.”The Community Living Assistance Services and Supports (CLASS) program was designed to give the disabled and elderly cash to receive care at home instead of usually more expensive institutional care.Under the law, workers would have begun enrolling in the program after October of 2012, after the HHS set the program’s benefits. The program was to have been voluntary, with participants required to pay into it for at least five years before qualifying for benefits.The Congressional Budget Office had estimated the program would reduce the federal deficit by $70 billion in the program’s first decade.However, the CBO also said the program would start to lose money after the first decade or two, once benefit payments exceeded income from premiums.Republicans, many of whom are eager to repeal Obama’s healthcare reform, have criticized the CLASS Act as a way to trump up the cost savings of the Affordable Care Act.”The CLASS Act was a budget gimmick that might enhance the numbers on a Washington bureaucrat’s spreadsheet but was destined to fail in the real world,” said Senate Republican Leader Mitch McConnell.”However, it is worth remembering that the CLASS Act is only one of the unwise, unsustainable components of an unwise, unsustainable law.”Greenlee said the Affordable Care Act will continue to reduce the deficit by $127 billion between 2012 and 2021, even without the CLASS Act. However, the decision to suspend the program would probably reduce the president’s 2013 baseline budget.Dozens of states have sued to challenge the healthcare law, particularly its requirement that all Americans have health insurance. The Supreme Court is expected to rule on the legal challenge sometime before June 2012.NOT ADDING UPIn September, Republicans in Congress posted emails that showed government actuaries were already questioning CLASS, even before the program became part of the Affordable Care Act.The Republican Policy Committee also posted a September email from Bob Yee, an HHS actuary who said he was hired to run the program, saying he was leaving his position and the CLASS office would be closing.HHS Secretary Kathleen Sebelius in February acknowledged the agency was struggling to make the program self-sustainable in the long run.On Friday, Greenlee said the law specifically allowed the program to be suspended if the HHS could not prove it was financially sound for 75 years.”Because of the tremendous uncertainty that surrounded the program from its inception, it had this provision that the (HHS) Secretary had to satisfy solvency, and we could not proceed otherwise,” she said.Some Democrats on Friday urged the HHS to not be so quick in giving up on the program.Congressman Frank Pallone, a Democrat from New Jersey who co-authored the program along with the late Senator Edward Kennedy, said seniors and the disabled who need home care would only have Medicaid to fall back on if the program were repealed.”If the program needs improving, then let’s find the way to do it,” he said in a statement.”While we are fighting so hard against Republican attempts to cut Medicaid … abandoning the CLASS Act is the wrong decision. Soon enough, those in need will have nowhere to go for long term care.”According to the AARP, a nonprofit group that represents those over 50 years of age, 70 percent of people age 65 and over will need long-term care services at some point in their lifetime, and Medicare, the federal insurance program for the elderly and disabled, does not cover such care.
UPDATE 1-Suzuki: VW breached pact by hiding technology
* Suzuki: VW must sell back stake if it fails to act* Suzuki: may consider other steps to prompt action from VWBy Mayumi NegishiTOKYO, Oct 14 (Reuters) - Japan’s Suzuki Motor Corp
said on Friday it has served Volkswagen with a
notice of breach of contract, demanding the German company give
it access to hybrid technology promised under a two-year old
partnership pact.Unless it does so, Suzuki’s biggest shareholder must sell
back its stake and quit the alliance, it said.The latest exchange in accusations deepens a feud between
the two carmakers. VW last month accused the Japanese firm of
breaching their agreement by procuring diesel engines from Fiat
and is demanding it end that cooperation.”The whole point of the partnership was to gain access to
key technologies, such as those for hybrids and environment
technologies,” Executive Vice President Yasuhito Harayama said
at a news conference in Tokyo.”If VW can’t honour that, it must return Suzuki’s shares
immediately.”Suzuki, which has said it has yet to hear a proper response
from VW about a proposal to end their partnership, is demanding
action within weeks, Harayama said, adding that Suzuki may
consider other steps if VW ignores the notice.VW bought a 19.9 percent interest in Suzuki for about 1.7
billion euros ($2.3 billion) in January 2009.Billed as a partnership of equals, the tie-up was meant to
bolster VW’s presence in India for small cars and give Suzuki
access to technology it could not afford to develop on its own
but the partnership has so far failed to deliver any meaningful
cooperation.”If this situation is not resolved quickly, it does not mean
that Suzuki is in trouble, but it is in neither companies’
interest for this uncertainty to drag on for too long,” said
Harayama.Suzuki’s deal with VW is not the first time it has tied
itself to one of the big global automakers.In 1998, Suzuki joined a strategic partnership with General
Motors , which took a 17.4 percent stake in the Japanese
firm. That unravelled in 2006 when the U.S. car company sold
most of its stake as it scrambled for cash amid ballooning
losses.
WRAPUP 3-US Senate defeats Obama’s jobs bill
By Andy Sullivan and Laura MacinnisWASHINGTON, Oct 11 (Reuters) - The U.S. Senate defeated
President Barack Obama’s job-creation package on Tuesday in a
sign that Washington is likely too paralyzed to take major
steps to spur hiring before the 2012 elections.The $447 billion package of tax cuts and new spending
failed by a vote of 50 to 48, short of the 60 votes it needed
to advance in the 100-member Senate. Voting was expected to
continue for several hours but would not affect the outcome.Obama, campaigning in Florida, said the vote was not the
end of the fight for the measure. In a statement after the
vote, Obama accused Republicans of obstruction and said he
would work with Senate Majority Leader Harry Reid to make sure
that individual proposals in the bill would get a vote as soon
as possible.”Ultimately, the American people won’t take ‘no’ for an
answer. It’s time for Congress to meet their responsibility,
put their party politics aside and take action on jobs right
now.”Obama had barnstormed around the country to pressure his
Republican opponents to back his top legislative priority, but
he did not pick up a single Republican vote in the
Democratic-controlled Senate.Two Democrats, facing re-election in conservative states,
also voted against the measure.Obama said earlier on Tuesday he would try to pass
components of the bill individually.Though Obama’s top legislative priority is now dead in
Congress, it is certain to have a long afterlife on the
campaign trail.Obama’s 2012 re-election chances depend on his ability to
spur the sluggish economic recovery and revive the nearly
stagnant job market.The U.S. unemployment rate has been above 9 percent since
May and almost 45 percent of the 14 million jobless Americans
have been out of work for six months or more.Even Wall Street is feeling the pinch, with a report from
the New York State Comptroller showing that banker bonuses are
likely to drop for the second year in a row.Among the elements of the bill which might be salvaged are
a payroll tax cut which Obama wants to extend to avoid imposing
an effective tax increase at a time when wages have not been
rising much. Obama’s bill would also extend unemployment
benefits for the long-term unemployed, another area that could
yield bipartisan support.Other elements, such as increased highway spending and aid
for cash-strapped states, aren’t likely to pick up Republican
support.POLITICAL FOOTBALLDemocrats say that Republicans are more interested in
defeating Obama than helping the country recover from the
deepest recession since the 1930s.”Republicans think if the economy improves it might help
President Obama. So they root for the economy to fail, and
oppose every effort to improve it,” Senate Democratic Leader
Harry Reid said before the vote.Republicans, who have lined up behind a job-creation agenda
centered around relaxing business regulations, say Obama’s jobs
bill is essentially a warmed-over version of his 2009
stimulus.That effort helped to ease the impact of the worst
recession since the 1930s, but Republicans point out that it
did not keep unemployment below 8 percent as the White House
had promised.”Everyone who votes for this second stimulus will have to
answer a simple but important question: why on Earth would you
support an approach that we already know won’t work?” said
Senate Republican Leader Mitch McConnell.Obama’s so-called Jobs Council, under the chairmanship of
GE Chief Executive Officer Jeffrey Immelt, earlier
delivered a report in which they proposed steps to foster U.S.
innovation and make the country more attractive to foreign
investment.
B of A tries to burnish tarnished image with ads
* Consumer groups are not impressedBy Rick RothackerOct 11 (Reuters) - Bank of America Corp, under fire
for everything from improper foreclosures to hiking debit card
fees, is fighting back with advertising.The bank is running TV, print and online ads through the
end of the year in 12 larger markets, including Charlotte,
Boston, Chicago, New York and Los Angeles, as well as some
smaller communities, said bank spokesman T.J. Crawford.The ads describe the bank’s charitable donations and small
business loans, as well as its efforts to ease loan terms for
underwater mortgage borrowers, known as “loan modifications.”“The campaign aims to deliver the facts about Bank of
America’s local impact,” Crawford said. “Sharing the
significant work we do at the local level and critical role we
play is more important than ever.”Bank of America’s critics were not impressed.The ads are “irrelevant,” said Kathleen Day, spokeswoman
for the Center for Responsible Lending, a Durham, North
Carolina-based nonprofit that advocates for homeowners. “The
only thing that matters is that they and other banks clean up
their servicing operations so they can do more loan
modifications and never do the same thing to the economy
again.”Bank of America and other banks launched similar campaigns
when they faced criticism in 2009 for taking government bailout
dollars.Large banks have paid back that money but face continuing
outrage over their mishandling of foreclosure paperwork, new
fees they are charging consumers, and the continuing economic
fallout from the financial crisis.The “Occupy Wall Street” movement has spread from New York
to other cities around the country, including the bank’s
hometown of Charlotte, North Carolina.WORKING TO HELPThe nation’s largest bank by assets debuted the campaign
Sept. 26, days before it announced a new $5 per-month debit
card fee and experienced problems with its web site.An ad that ran Sunday in Charlotte carried the tagline:
“We’re working to help keep the North Carolina economy moving
forward.”It noted the bank’s contributions to the state, including
$159 million in loans to small businesses in the first half of
the year, more than 22,000 loan modifications since 2008 and
$10.8 million in charitable commitments this year.The bank does not disclose the cost of its advertising
campaigns, Crawford said. In the first half of this year, Bank
of America spent $1.1 billion on marketing, up from $982
million in the same period last year, according to its
second-quarter earnings report.Bank of America lost $7.4 billion for common shareholders
in the first half of the year, as it set aside money to cover
mortgage loses and legal settlements. It reports third-quarter
earnings on Oct. 18.
