U.S. plans to take over Sears' pensions
CHICAGO -- A federal agency is preparing to take responsibility for Sears' pension plans, which cover more than 90,000 people.
The Pension Benefit Guaranty Corp. said in a news release Friday that it believes Hoffman Estates, Ill.-based Sears Holdings Corp.'s "continuation of the plans is no longer possible" after the company filed for bankruptcy.
The agency covers individuals' pensions, up to certain limits, if an insured pension plan shuts down without enough money to pay all benefits. It estimates Sears' two pension plans are underfunded by about $1.4 billion.
Ron Olbrysh, chairman of the National Association of Retired Sears Employees, said the guarantee means retirees aren't worried about losing pensions, but they do have concerns about other benefits.
"The pensions are secure through Sears or through the Pension Benefit Guaranty Corp.," he said. "The big impact if Sears does liquidate is that retirees will lose life insurance."
Sears will remain responsible for the plans until it agrees to have them terminated or a court orders the plans terminated, according to the agency. The agency is seeking to take over the plans as of Jan. 31.
-- Chicago Tribune
Ford official confirms electric pickups
DETROIT -- Ford Motor Co. confirmed plans to build a fully electric F-Series pickup, which industry observers called an unexpected move that protects the truck franchise against Tesla and other competitors.
"We're going to be electrifying the F-Series -- battery electric and hybrid," Jim Farley, Ford president of global markets, said this week during a presentation at the Deutsche Bank Global Automotive Conference in the MGM Grand in Detroit.
In framing the company's redesign, Farley said a move toward all-electric and hybrid would "futureproof" the billion-dollar F-Series franchise, which he called a "global juggernaut."
"Ninety percent of our capital now is allocated toward trucks and utilities," Farley said. "We have the F-Series, the world and America's best-selling truck. More than a million units were sold last year. F-Series' core strength at the end of the day is: There's a truck for every customer, and we know those customers really, really well."
-- Detroit Free Press
Malaysia wants U.S. firm to pay $7.5B
PUTRAYAJAYA, Malaysia -- Malaysia's Finance Minister Lim Guan Eng said Friday that an apology by Goldman Sachs for its role in the alleged multibillion-dollar ransacking of state investment fund 1MDB was insufficient and that it must pay $7.5 billion as compensation.
Goldman Chief Executive Officer David Solomon apologized Wednesday to the Malaysian people for former banker Tim Leissner's role in arranging bond sales for 1MDB. They provided a means for associates of former Malaysian Prime Minister Najib Razak to allegedly steal billions over several years from the fund.
Solomon has said the investment bank conducted due diligence but was misled by Leissner and former Malaysian government officials.
"That's insufficient, necessary but not sufficient," said Lim. "Apology with $7.5 billion is what matters ... there has to be accountability."
The 1MDB fund was set up for economic development by Najib when he took office in 2009. It instead accumulated billions in debt and is being investigated in the U.S. and several other countries.
-- The Associated Press
Judge halts prep for offshore drilling
COLUMBIA, S.C. -- A federal judge in South Carolina has turned back an attempt by President Donald Trump's administration to continue preparatory work for offshore drilling during the federal government's partial shutdown, issuing a ruling in a federal lawsuit challenging the overall expansion plans.
In his order, U.S. District Judge Richard Gergel halted federal agencies "from taking action to promulgate permits, otherwise approve, or take any other official action" for permits to conduct testing that's needed before drilling work can begin.
The ruling comes a few days after Trump's decision to recall workers at the Bureau of Ocean Energy Management so they could continue to process testing permits for possible drilling off the Atlantic coastline.
Earlier this month, South Carolina joined a federal lawsuit opposing the administration's plans to conduct offshore drilling tests using seismic air guns. Gergel is overseeing that case, initially filed by environmental groups and municipalities along the state's coast.
-- The Associated Press
David's Bridal chain exits bankruptcy
PHILADELPHIA -- America's largest wedding gown retailer emerged from bankruptcy on Friday, just weeks after it first sought protection from creditors.
David's Bridal Inc. cut its debt load by about $450 million and is now owned by lenders including Oaktree Capital Group. The company, which filed for bankruptcy in November, was looking to exit bankruptcy quickly to avoid scaring off brides who might fear a store under court protection from creditors was at risk of collapsing, destroying wedding plans in the process.
January is a critical time for companies like David's Bridal, as people who get engaged over the holidays begin shopping for wedding dresses.
David's Bridal, based in the Philadelphia suburb of Conshohocken, is one in a procession of retailers to file for Chapter 11 court protection after struggling with heavy debt loads. This week Gymboree filed to liquidate in bankruptcy, less than two years after it reorganized in bankruptcy.
-- Bloomberg News
Morgan Stanley pays CEO $29M for '18
NEW YORK -- Morgan Stanley raised Chief Executive Officer James Gorman's compensation by 7.4 percent to $29 million for 2018.
Gorman, 60, got a $13.75 million incentive tied to achieving future targets, and $6.875 million in both cash and restricted shares, according to a regulatory filing Friday. The package, which includes his $1.5 million salary, surpasses the $27 million he was paid for 2017 as the most he's received since taking the helm.
Morgan Stanley this week posted its highest-ever annual profit, even as fourth-quarter performance disappointed investors. The bank was helped by U.S. corporate tax cuts, a jump in deal fees and a bigger rise in trading revenue than many rivals. Gorman said Thursday he's looking for acquisitions to build his firm's asset-management unit, its smallest division.
The incentive award converts to shares if the firm hits goals for return on equity and total shareholder return.
-- Bloomberg News
Business on 01/19/2019