As Rate Hike Nears, Fed’s Hints on Future to Be Scrutinized
WASHINGTON (AP) – It’s not about what it will do. It’s about what it will say.
The worst-kept secret in the financial world is that the Federal Reserve is all but sure Wednesday to raise interest rates from record lows by a modest quarter point. The uncertainty hinges on what the Fed will say about how much and how fast it expects to raise rates again in coming months. A relatively aggressive pace would contribute to higher borrowing rates and risks slowing the economy. It could also roil financial markets.
Cheniere Energy Replacing CEO Souki
HOUSTON (AP) – Cheniere Energy has announced the departure of its co-founder and chief executive under pressure from activist investor Carl Icahn.
Icahn first revealed a sizeable stake in Cheniere in August, then two weeks later announced that he had upped that stake to more than 11 percent. The company agreed to seat two of his associates on the board and on Monday, announced that it was replacing Charif Souki, who helped to found the company and has ambitiously tried expand the company’s reach.
Cheniere named board member Neal Shear as interim president and CEO.
Newell Rubbermaid Buying Jarden in Cash-and-Stock Deal
ATLANTA (AP) – Newell Rubbermaid is buying Jarden Corp. in a cash-and-stock deal that it says will generate about $16 billion in revenue per year with brands such as Paper Mate, Sharpie, Elmer’s, Rubbermaid, Lenox, Yankee Candle and Graco.
Jarden shareholders will receive $21 in cash and 0.862 shares of Newell Rubbermaid stock for each share they own. The implied total value is $60 per share worth about $13.2 billion. The company says that holders of convertible bonds also qualify for the deal, boosting the price of the overall transaction to about $15.4 billion.
Newell Rubbermaid shareholders will own about 55 percent of the combined business.
Dow Chemical’s Board Reaffirms Support for DuPont Deal
NEW YORK (AP) – Dow Chemical’s board reaffirmed its support for the company’s merger with DuPont on Monday after a news report said activist investor Daniel Loeb wants Dow’s CEO to be removed.
The Wall Street Journal said Loeb, who heads Third Point LLC, wrote a private letter to Dow’s board over the weekend that questioned the timing of the merger and pushed for Dow CEO Andrew Liveris to be removed. Loeb’s firm has a 2 percent stake in Dow, according to FactSet.
Dow’s board said in a statement Monday that they fully support the deal. A Dow representative did not immediately respond to a request for comment.
Natural Gas, Used to Heat Homes, Plunges on Mild Weather
NEW YORK (AP) – Mild temperatures have cooled demand for natural gas, sending its price down sharply Monday. Stocks of companies that produce natural gas also fell.
Natural gas is used to heat more than half of U.S. households, according to the American Petroleum Institute. But with unseasonably warm temperatures, there’s less demand for it. Temperatures in Chicago, Detroit, New York and Washington have been as much as 25 degrees above normal in the past five days, according to AccuWeather. And the weather forecasting company expects the mild weather to continue next week, with temperatures expected to be between 20 and 30 degrees above normal.
Besides warm weather, there’s also an oversupply of natural gas that’s pushing prices down. Raymond James analysts said last week, in a note to clients, that they expected natural gas prices to remain “depressed” into next year due to the oversupply.
FAA to Require Most Drones to Be Registered and Marked
The federal government will soon require that drones be registered to make it easier to identify owners and educate amateur aviators.
The move, announced Monday by the Federal Aviation Administration, comes at a time when the agency is receiving more than 100 reports per month about drones flying near manned aircraft. The FAA prohibits drones and model airplanes from flying higher than 400 feet or within 5 miles of an airport.
The FAA estimates that 1.6 million small unmanned aircraft will be sold this year, with half during the last three months of the year.