Equitable Resources Rating Cut By S&P on Debt Outlook
Standard & Poor’s lowered Equitable Resources Inc.’s credit and senior unsecured ratings to BBB from A- with a negative outlook on Wednesday, a day after the North Shore-based company dropped plans to buy two natural gas companies from Dominion Resources Inc. Equitable had been on S&P’s CreditWatch list since the deal to acquire Dominion Peoples and Hope was announced in March 2006. S&P at that time was concerned Equitable would finance the purchases largely with debt. That risk is gone, but S&P said it took the company off CreditWatch and lowered the ratings because Equitable plans to finance its rapid exploration and production growth mostly with debt. It had $1.1 billion in debt as of Sept. 30.
Oil futures prices fall
Energy futures fell Wednesday, at times dropping below $90 a barrel after the government said crude oil supplies jumped unexpectedly last week. In its weekly inventory report, the Energy Department’s Energy Information Administration said crude oil supplies rose by 4.3 million barrels last week, the first increase since the week ended Nov. 9. Analysts surveyed on average expected a decline of 300,000 barrels. Supplies of gasoline and distillates, which include heating oil, rose last week roughly in line with expectations.
ArcelorMittal selling land
ArcelorMittal is launching a national marketing campaign to sell off more than 1,700 acres of land in and around its West Virginia steel operations, from quarter-acre residential parcels to large, wooded lots. ArcelorMittal will work with local and state officials to ensure proposed redevelopment projects make sense for Weirton, whose population and economy have dwindled since the bankruptcy of the former Weirton Steel Corp., said Keith Nagel, director of environmental affairs and real estate for the steelmaker. About half the acreage owned by Weirton Steel had nothing to do with steelmaking.
Chocolatier may face fine
Owners of a Strip District chocolate company soon could pay more than $10,000 in overtime compensation and penalties. U.S. Department of Labor filed a federal lawsuit Wednesday against Fudgie Wudgie Fudge & Chocolate Factory and its owners, Christine Falvo and Christopher Warman. The lawsuit claims the business, which does more than $500,000 in annual sales, paid workers less than the required time and a half for overtime. It also accuses the company of failing to keep accurate work records for certain employees. The Labor Department wants a federal judge in Pittsburgh to order the company to pay $5,289.49 to employees as well as a civil penalty of $5,797. Neither Falvo nor Warman could be reached for comment.
Au Bon Pain investment
Au Bon Pain said Wednesday that a private equity firm would invest more than $100 million to expand the bakery cafe chain, including new franchise locations overseas. LNK Partners and Au Bon Pain’s management will jointly acquire a majority ownership stake in the Boston-based company. Compass Group PLC, an existing investor in Au Bon Pain, will remain a part-owner, while an investor group led by PNC Mezzanine Capital will sell its interest. Au Bon Pain has nine locations in Western Pennsylvania, including two at the airport, two at Oxford Centre, U.S. Steel Tower, PPG Place, Fifth Avenue Place, Oliver Building, and South Hills Village.
Ex-Brocade CEO sentenced
The former CEO of Brocade Communications Systems Inc. was sentenced on Wednesday to 21 months in prison for orchestrating a scheme to tamper with financial records of stock options the company offered. Gregory Reyes, Brocade’s CEO from 1998 to 2005, was also ordered to pay a $15 million fine. At the sentencing hearing, U.S. District Judge Charles Breyer said Reyes obstructed justice in preparing for trial. Reyes became the first executive to go on trial over stock options backdating when his case went before a federal jury in San Francisco in June 2007. He was convicted in August of 10 counts of securities fraud.
Other business news:
– Small-business owners now can file their state taxes electronically because of improvements to Pennsylvania’s filing system, state Revenue Secretary Tom Wolf said Wednesday. Last year, 52 percent of all state taxpayers filed electronically. This year, Schedule C for reporting business profits or losses has been added to the Internet-based system, accommodating small businesses. Taxpayers have until midnight April 15 to file 2007 returns; online returns can be filed via www.revenue.state.pa.us, under pa.direct.file.
– KDKA-TV’s Jon Delano was appointed to the board of directors at Pennsylvania American Water Co. Delano, with a background in politics, is the station’s money and politics editor and an adjunct professor at Carnegie Mellon University’s H. John Heinz School of Public Policy & Management. Pennsylvania American provides water or wastewater service to more than 2.1 million people in Pennsylvania.
– Lanxess AG said it will close down its Ion Exchange Resins business unit in Birmingham, N.J. in May. The production and marketing center, which employs about 90 people, “is no longer competitive,” said Dr. Rainier van Roessel, a member of the Lanxess Board of Management, in a statement Wednesday. Lanxess has it’s North American headquarters in Findlay.
– Pittsburgh-area stocks fell on Wednesday. The Bloomberg Pittsburgh Index of local stocks fell 1.58 to 323.85.
Originally published by staff and wire reports.
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