BUSINESS BRIEFS Home Depot acquires Kmart stores
TROY, Mich. -- Kmart Holding Corp.'s sale of 13 stores to The Home Depot Inc. could cost up to 1,200 Kmart employees their jobs in coming months.
Under an agreement announced in June, Kmart will sell no fewer than 13 stores for $173 million in cash and up to 19 stores for $288.5 million. Nine of the stores already have been sold.
The Kmart employees being laid off will receive no severance pay, company spokesman Steve Pagnani told the Detroit Free Press for a story today.
Kmart, which emerged from bankruptcy in May 2003, has struggled to maintain sales, but has taken advantage of demand for its valuable real estate. In June, the company announced plans to sell 54 of its stores to Sears, Roebuck and Co. for up to $621 million.
Sears plans to occupy those stores by April 2005, when approximately 5,000 more Kmart workers will lose their jobs.
Report: Economic recovery drooping
NEW YORK -- Offering more evidence that the nation's economic recovery is losing steam, a closely watched gauge of future business activity fell in July for the second consecutive month.
The Conference Board said Thursday that its Composite Index of Leading Economic Indicators dropped by 0.3 percent in July to 116.0, following a revised decline of 0.1 percent in June. Last month was the first time in more than a year that the index had lost ground, and the July decline was larger than the 0.1 percent dip forecast by analysts.
The index is closely followed because it is designed to forecast the economy's health over the coming three to six months. Economists said the new reading, taken together with a mixed batch of other recent data, points to slower growth in the months ahead.
Google shares jump following auction
SAN JOSE, Calif. -- In a debut vaguely reminiscent of the dot-com boom, shares of Internet search giant Google Inc. surged in their first day of public trading Thursday as investors who avoided the company's auction-based offering readily jumped into the familiar territory of the stock market.
Though the 18 percent jump boosted the paper worth of Google shareholders and insiders, it also raised questions about the effectiveness of the unorthodox auction, which was designed to gauge true demand and set a rational price that wouldn't be subject to big swings.
Google shares finished the day at $100.34 with more than 22 million shares having changed hands, making it among the 10 most active issues on the Nasdaq Stock Market. The closing price was $15.34 higher than the final IPO price set by the auction, but still lower than the $108 bottom of the company's initial range.
United faces huge pension fund default
CHICAGO -- United Airlines warned that it likely will have to terminate its employee pension funds in order to secure the loans it needs to get out of bankruptcy -- a drastic step that would represent the largest pension default ever by a U.S. company.
The statement, made in bankruptcy court papers filed Wednesday and seen publicly Thursday, confirmed the fears of unions that had already gone to court in July to fight United's decision to halt pension contributions while it is in Chapter 11.
Cash-strapped United faces half a billion dollars in pension contributions in the next two months, and $4.1 billion by the end of 2008.
US Airways union zeroing in on deal
ARLINGTON, Va. -- Union leaders representing US Airways pilots said Thursday that a new labor agreement could be struck soon, telling their rank and file a new deal is "our last opportunity to control the fate of our airline and our careers."
US Airways Group Inc. has said that new labor deals with unions are necessary to avoid a second trip into bankruptcy and possible liquidation.
Though the Arlington, Va.-based airline has warned that bankruptcy looms if deals are not reached by at least Sept. 30, progress has been slow.
A deal with the pilots would be the first significant step in US Airways' plans to cut costs by $1.5 billion a year, including labor savings of $800 million.