Business news in brief

QUOTE OF THE DAY

“The Dow is going to look and act very differently going forward.”

Dan Greenhaus, BTIG LLC strategist, on companies being added to the Dow Jones industrial average Article, 1D

Wal-Mart to take smartphone trade-ins

On the day that Apple Chief Executive Officer Tim Cook took the stage at the company’s Cupertino, Calif., headquarters to show off the new iPhone models, Wal-Mart Stores Inc. on Tuesday announced a new smartphone trade-in program in the United States.

Shoppers can get $50 to $300 in immediate credit, as long as they use it to buy a new smartphone at one of more than 3,600 Wal-Mart stores and Sam’s Clubs. The program begins Sept. 21.

The retailer said it expects to save hundreds of thousands of smartphones from ending up in landfills every year.

Examples of trade-in values for working, undamaged smartphones include: $300 for an Apple iPhone 5, $175 for a Samsung Galaxy SIII and $52 for a Samsung Galaxy S2. The value of trade-ins will be assessed after shoppers answer a few questions on the device’s condition and specifications.

“With shorter smartphone life cycles, we know more than 62 percent of consumers will choose where they buy their new device based on a retailer’s trade-in program,” Steve Bratspies, executive vice president of general merchandise for Wal-Mart U.S., said Tuesday.

“We believe our low prices on the newest phones and exclusive offerings like Straight Talk differentiate us and provide an unmatched value to our customers.”

Container imports are up, report says

Import volume at the U.S.’ major retail container ports has inched upward over the summer. Volume is expected to grow 5.1 percent this month over September of last year, according to the monthly Global Port Tracker report released Tuesday by the National Retail Federation and Hackett Associates.

Some attribute the uptick to retailers’ expectations heading into the Christmas season, but retail federation spokesman Craig Shearman warns against reading too much into it.

“It doesn’t take into account what they might already have in inventory, [and] we can’t measure the value of the merchandise because we only know the number of containers, not what’s inside,” he said. That means cargo import numbers do not correlate directly with retail sales or employment. But the amount of merchandise imported nonetheless provides a measure of retailers’ expectations, Shearman said.

“Since a larger percentage of merchandise sold in the U.S. is made overseas, imports provide a rough barometer of what retailers are expecting in sales,” Shearman said. “If they expect to sell more, they import more. But it’s only rough.”

  • Cyd King

Diesel holding steady under $4 mark

Diesel fuel prices nationwide remained at $3.981 per gallon, according to a weekly report from the U.S. Department of Energy.

The price remained unchanged from last week, when average fuel cost per gallon reached a five-month high.

March 25 is the last time prices exceeded $4 per gallon.

Prices in the Gulf Coast Region, which includes Arkansas, were at $3.898. It’s an increase of $.001 from a week ago, according to the DOE calculations. Diesel prices are down $.15 from the same week in 2012.

Retail gas prices are $3.54 per gallon. The average per gallon in the Gulf Coast Region reached $3.384, down from $3.413 a week ago. Nationally, the price is 26 cents less than the same time period last year.

Average diesel fuel price is calculated by the Energy Department from a sample of about 400 retail diesel outlets in the continental United States. Gas prices are figured from a sample of 800 gas stations nationwide.

Dell buyout votes there, source says

Dell Inc. and Silver Lake Management LLC have secured the votes needed for approval of their proposed $24.9 billion leveraged buyout, according to a person with knowledge of the matter.

Holders of two-thirds of the voting shares have indicated their support for the proposed transaction, the largest leveraged buyout since 2007, said the person, who asked not to be identified because the outcome isn’t public.

Michael Dell is poised to buy out the company after a seven-month contest that left the fate of the world’s third-largest computer maker in doubt for much of the year. Billionaire financier Carl Icahn dropped his opposition to the deal Monday, removing what for several months was one of the largest obstacles to getting the buyout approved.

“It’s going to make the shareholder meeting a lot easier,” Shannon Cross, an analyst at Cross Research, said of Icahn’s decision.

The results of the voting will be disclosed at a Thursday meeting at Dell’s Round Rock, Texas, headquarters.

Investors, including Franklin Mutual Advisers and Black Rock Inc., are supporting the offer after the buyout group sweetened its proposal to $13.75 per share, plus a 13-cent special dividend and guaranteed payment of the company’s third-quarter dividend.

Walgreen buying Kerr Drug operations

DEERFIELD, Ill. - Walgreen Co. plans to buy Kerr Drug’s 76 retail drugstores and its specialty pharmacy business, a move that will help the nation’s largest drugstore chain expand its North Carolina presence.

The deal also includes a distribution center, but does not include the long-term care pharmacy business of Kerr, a privately held regional chain.

Financial terms were not disclosed.

Kerr Drug’s retail drugstores and specialty pharmacy business had fiscal 2012 sales of $381 million. In contrast, Walgreen recorded nearly $72 billion in revenue during fiscal 2012.

Deerfield, Ill.-based Walgreen has 8,117 drugstores in all 50 states, the District of Columbia and Puerto Rico.

CVS Caremark Corp. is the second-largest drugstore chain with more than 7,500 stores, while Rite Aid Corp. has about 4,600.

Walgreen said Tuesday that it expects the acquisition to close this year. Once complete, Kerr Drug’s retail drugstores will continue to run under their current brand in the near term.

Business, Pages 28 on 09/11/2013

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