Friday, January 30, 2004

Business digest

P&G unit to license hair-care brands

A unit of Procter & Gamble Co. has signed a deal to license the retail hair-care brands of Wella AG, P&G said Thursday.

P&G owns 80 percent of Wella's total stock but is facing a group of unhappy minority shareholders. Under the deal, P&G will market and sell the Wella retail brands and pay a licensing fee to the German company. Wella's professional business will continue to be operated independently.

In a statement, the Wella minority shareholders - who own nonvoting shares and have opposed the financial terms of the P&G acquisition - said the licensing deal "runs totally counter to German corporate law."

Cognis, steelworkers continue contract talks

Negotiators for Cognis Corp. and United Steelworkers Local 14340 will continue talks today on a contract to replace the existing agreement expiring Monday.

Local 14340 represents about 300 employees at Cognis' Winton Place specialty chemical plant.

Dave Mclean, staff representative for the Steelworkers, said proposed company changes in seniority, health insurance and elimination of Saturday and Sunday premium pay are major stumbling blocks.

Speculation pushes rates up marginally

WASHINGTON - Mortgage rates around the country rose this week amid speculation about when the Federal Reserve may begin to push up short-term interest rates.

The average rate on 30-year mortgages increased to 5.68 percent, up from 5.64 percent last week, Freddie Mac, the mortgage giant, said Thursday in its weekly nationwide survey of mortgage rates. For 15-year mortgages, a popular option for refinancing, rates rose to 4.97 percent this week, up from 4.95 percent last week. Rates for one-year adjustable mortgages increased to 3.59 percent compared to 3.56 percent last week.

Fed Chairman Alan Greenspan and his colleagues on Wednesday decided to hold a main short-term interest rate at a 45-year low of 1 percent, but they dropped a pledge to keep rates at near rock-bottom levels for a "considerable period." That prompted investors to believe rates would move up sooner than they previously thought.

Wages, benefits grew 0.7 percent in quarter

WASHINGTON - Workers' wages and benefits grew by 0.7 percent in the final quarter of 2003 - the smallest quarterly increase in a year - as companies kept a close eye on their bottom line.

The increase in the employment cost index for the October-to-December quarter marked a moderation from the 1 percent advance registered in the previous quarter, the Labor Department reported Thursday. The 0.7 percent increase in compensation was the smallest since the fourth quarter of 2002. Economists had forecasted a 0.9 percent rise.

In a second report from the department, new claims for unemployment benefits last week dipped by a seasonally adjusted 1,000 to 342,000, the lowest level since the end of December, a sign that the pace of layoffs is stabilizing.

Kwikset plant to close; 1,200 jobs eliminated

BRISTOW, Okla. - Black & Decker Corp. plans to close its Kwikset lockmaking plant in Bristow by the end of 2005, eliminating about 1,200 jobs.

The Kwikset division of Towson, Md.-based Black & Decker announced Thursday that closing the plant will enable the parent company to use its manufacturing capacity more efficiently. Kwikset told its workers in December that it was considering closing the plant, which makes door locksets, deadbolts, knobs and other home improvement hardware.

All affected employees - 800 Kwikset workers and 400 hired through temporary agencies - will be given at least 60 days notice before being laid off and will be offered severance packages and outplacement assistance, the company said. In trading on the New York Stock Exchange, Black & Decker shares were down $1.03 to close at $50.01.

Huntington to acquire Unizan in stock deal

Columbus-based Huntington Bancshares Inc. this week said that it is acquiring Canton-based Unizan Financial Corp. in a stock deal the companies value at $587 million. The merger is expected to close late in the second quarter of 2004, pending regulators' and shareholders' approvals.

Staff/wire reports

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