Oil price rise widens US trade deficit by $4.7 billion in Q1'07
Mumbai: US trade deficit widened by $4.7 billion in the first three months of 2007, following a rise in oil prices, data released by the commerce department showed. This took the country's balance of payments to $192.6 billion, from a revised $187.9 billion in the last quarter of 2006.

US trade gap widened despite an increase in goods exports to $270.1 billion from $266.5 billion, as imports rose to $471 billion from $466.8 billion.

Capital payments to foreigners also increased considerably to $20.7 billion from $26.1 billion due in part to money paid to the Middle East and private remittances.

The rise in trade deficit, however, was less than analysts had forecast and many expect it to narrow over time as exports increase.

The US has seen its trade deficit at record highs for five years in a row despite robust growth in exports.

"Robust export growth, and some cooling in import growth, should keep the deficit down this year," he added.

Some analysts say the trade deficit was caused by an overvalued dollar against the Chinese yuan as well as an inadequate energy policy making the US overly dependent on foreign oil. These underlying trends, they say, needs to be reversed.

But there is more to it than just the overvaluation of the dollar. Rising oil prices made it worse for the increasing US trade deficit.. The value of petroleum imports shot up by $230 billion between 1996 and 2006, which represents a 300 per cent increase. Because the volume of oil imports increased only 35 per cent, the vast majority of the surge in import values occurred because of the sharp rise in petroleum prices.

Reducing the current account deficit is rather straightforward, at least in theory. Because the US has been spending more than it produces, it has been incurring current account deficits. Therefore, reducing the deficit simply means bringing spending back in line with production. Slower US economic growth should translate into slower spending growth, and dollar depreciation can help shift production from foreign economies to the US via changes in relative prices. It sounds simple, at least, in theory. However, a closer look at the the structure of the trade deficit reveals that a significant narrowing of the deficit may be more difficult to achieve in practice.
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Huntsman acquires majority stake in Saudi polyurethane JV
Mumbai: Huntsman Corporation has signed an agreement with Saudi's Basic Chemical Industries Limited to transfer majority ownership in Arabian Polyol Company (APC) — an existing joint venture of the two companies in Saudi Arabia — from BCI to Huntsman.

The joint venture, which manufactures and sells MDI-based polyurethane systems in the Gulf countries, will be re-named Huntsman APC. Financial arrangements of the deal are yet to be disclosed.

"This increase in our shareholding demonstrates Huntsman's determination to bring new investment to emerging markets," said Nick Webster, vice president of Huntsman's polyurethanes division in Europe and the Middle East . "Construction in the Gulf countries continues to grow at about 15 per cent per year and BCI's local skills and leadership in chemicals will continue to be invaluable to us as we further develop and innovate in this important market," he added.

"Our joint venture with Huntsman, a world leader in MDI-based polyurethanes, has operated very successfully for more than 20 years and we warmly welcome this demonstration of Huntsman's accelerated commitment to growth opportunities in the Gulf region," said Mike Layous, managing director of BCI.

Huntsman APC will be based at the existing Dammam site on Saudi Arabia 's east coast, supported by a Huntsman sales office in Dubai.

Huntsman is a global leader in manufacturing and marketing of differentiated chemicals. It manufactures a variety of products for global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging.

A pioneer in innovative packaging and a great achiever in integrated petrochemicals business, Huntsman today has 14,000 employees and over 75 operations in 24 countries. The company had 2006 revenues of over$13 billion from all operations.

BCI, located in Dammam, Saudi-Arabia, is a producer and distributor of more than 600 chemical products in the inorganic and specialties segments (hydrochloric acid, adhesives, polyurethanes, water treatment, resins etc.). Established in 1975 as a manufacturer of commodities and specialties chemicals for local and export markets, the group now has an annual turnover of $150 million employs around 400 workers.
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Delphi agrees to sell its Mexican brake plant, moves bankruptcy court
Mumbai: Delphi Corporation has announced an asset sale and purchase agreement between two of its subsidiaries and Robert Bosch LLC and its affiliate Frenados Mexicanos, S.A. de C.V., for the sale of their brake components business, including a manufacturing plant in Saltillo, Mexico.

The company also filed a motion with the US bankruptcy court for the southern district of New York to request a hearing on the bidding procedures on June 26.

On completion of the bidding procedure process, a final sale hearing is anticipated to be set for July 19, 2007 . The final sale of the plant is subject to the approval of the US bankruptcy court.

As outlined in the court filing, pursuant to the procedures outlined in the bankruptcy code, the $15 million asset sale and purchase agreement between Delphi and Bosch includes: Purchase of land, transfer of facility lease, machinery and equipment, assignment and assumption of certain contracts, etc.

Delphi, which filed for bankruptcy in October 2005, long ago opted to pursue a $3.4 billion equity plan from a group led by Appaloosa and Cerberus Capital Management that would take a controlling stake in the parts supplier, although Delphi has said Cerberus is expected to depart from the group.

But Highland, a hedge fund whose $4.7 billion plan was rebuffed earlier this year, said in a filing it met with Delphi and GM and signed a nondisclosure agreement to evaluate a possible transaction with Delphi, where Highland would be the lead investor.

Highland , which has called the current equity plan a "sweetheart deal" for its investors, had renewed requests for meetings with Delphi in April with the intention of exploring a possible alternative to the Cerberus-Appaloosa plan.

Delphi is one of the top auto parts suppliers globally and could have annual sales of about $21.2 billion once it completes the sales of some business units.
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French reactor builder Areva bids $2.5 billion for uranium explorer UraMin
Mumbai: State-owned French nuclear reactor builder Areva has made a $2.5-billion cash offer to acquire all the shares in uranium explorer UraMin.

The cash offer which would be made through its indirect subsidiary CFMM Developpement, values Toronto-listed UraMin at $7,25 a share, which represented a premium of 21 per cent over the company's 20-day weighted average trading price ending June 8.

The board of directors of UraMin had determined that the offer was fair and in the best interest of its shareholders and recommended that the offer be accepted. All directors and certain other shareholders, representing some 25 per cent of the outstanding shares, had entered into lock-up agreements with Areva and had agreed to tender all their sharesm UraMin added.

Areva, which already owns 5.5 per cent of UraMin, said the acquisition would "perfectly fit" into its strategy to significantly increase its uranium production in the medium term.

The explorer said it would mail the offer and takeover circular to its shareholders. The offer would be open for more than 35 days. However, it cautioned that no assurance could be given that the negotiations would be successful, the company said in a statement.

Established in 2005, UraMin owns uranium properties in Namibia , South Africa, and the Central African Republic . The explorer is currently focusing on the development of its advanced stage exploration projects at Trekkopje in Namibia, Bakouma, in the Central African Republic ,and Ryst Kuil, in South Africa.

UraMin has added Niger to its exploration portfolio, this shortly after it announced last month that Senegal has become one of its new hunting grounds. Other exploration projects include Mozambique, Chad and Canada.

UraMin's foray into Niger revolves around areas called Kamas 1 to 4, located in the Tim Mersoi basin.

Through a South African joint venture, UraMin also enjoys additional prospecting license applications for uranium deposits in the Karoo. More advanced projects, currently undergoing feasibility studies, include prospects in the Central African Republic and South Africa.

All of these projects form part of UraMin's ambition to produce 18-million pounds of uranium oxide by 2011.

Niger has been mining uranium since 1971, for an historic production of more than 100,000 tons of uranium to the end of 2006.

With an output of more than 3 093 t of uranium in 2005, the West African country was the world's sixth-ranked uranium producer, contributing 7,75% of world production.

The company currently has a market capitalisation of some $1,9-billion and trades on the Alternative Investment Market of the London Stock Exchange and the Toronto Stock Exchange.
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Celanese Corporation Completes Acquisition of Acetate Products Limited
Dallas: Celanese Corporation (NYSE:CE), a global hybrid chemical company, today announced completion of the acquisition of the cellulose acetate flake, tow and film business of Acetate Products Limited (APL), a subsidiary of Corsadi B.V. The transaction excludes the limited business activity in Romania as regulatory review continues and is expected to be completed by the end of the first quarter of 2007. The purchase price for the transaction was approximately USD $110 million. Celanese announced its intent to purchase APL in August 2006.

"This acquisition builds on our global acetate business and further enhances our strong capability to supply our customers," said Douglas Madden, president of Celanese Acetate. "We will immediately begin integrating the APL business into the Celanese Acetate products network."
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Celanese Completes Sale of Oxo Products and Derivatives Businesses
Celanese Corporation (NYSE:CE), a global hybrid chemical company, today announced that it completed the sale of its oxo products and derivatives businesses, including European Oxo GmbH ("EOXO"), a joint venture between Celanese AG and Degussa AG, to Advent International, for the purchase price of EUR€480 million, which is approximately USD $630 million at current exchange rates. The transaction excludes limited business activity in Turkey , which remains subject to customary regulatory review. Celanese announced its agreement to sell these businesses in December 2006.

"This sale is consistent with Celanese's strategy to divest non-core businesses and to increase focus on our core acetyl chain and downstream specialty businesses," said David Weidman, chairman and chief executive officer. "We are transforming Celanese into an attractive, integrated hybrid portfolio of leading global businesses positioned to increase value and deliver sustainable growth."

The sale includes oxo and derivatives businesses at Celanese's Oberhausen, Germany, and Bay City, Texas, facilities as well as portions of its Bishop, Texas, facility. The sale also includes EOXO's facilities within the Oberhausen and Marl , Germany , plants, and the 50 percent interest in the EOXO joint venture previously owned by Degussa.

As a global leader in the chemicals industry, Celanese Corporation makes products essential to everyday living. Our products, found in consumer and industrial applications, are manufactured in North America , Europe and Asia . Net sales totaled $6.7 billion in 2006, with over 60 per cent generated outside of North America.
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Australia announces huge national broadband plan
Sydney: Australian Prime Minister John Howard has announced a 2.0 billion dollar (1.68 billion US) plan to provide fast and affordable Internet access across the Australia.

Optus, the Australian offshoot of Singapore company Singtel, had been awarded a 958-million-dollar contract to build a broadband network in the bush with rural finance company Elders.

The joint venture, known as OPEL, would contribute a further 900 million dollars to provide broadband of at least 12 megabits per second by June 2009.

Howard said plan will deliver to 99 percent of the Australian population very fast and affordable broadband in just two years' time.

An expert group will also develop a bidding process for the building of a fibre-to-the-node (FTTN) broadband network, funded solely by private companies, in major cities of the country.
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Microsoft to pick up stake worth $12 mln stake in China TV maker
Shanghai: Microsoft Corp. is acquiring around one per cent stake in state backed company Sichuan Changhong Electric Co. for 94 million yuan ($12.3 million) and will form a cooperative alliance with the TV and electrical appliance maker. The two companies will cooperate to develop, make and market TVs, computers and other digital home-entertainment products, said Sichuan Changhong in a stock filing to the Shanghai Stock Exchange.

Under a memorandum of understanding, the Chinese company would place 15 million new shares with Microsoft at a price of 6.27 yuan each, a 43 percent discount to its last traded market price of 10.92 yuan.

Changhong's shares hit the upper circuit on Monday and helped to lift other technology stocks including TCL Corp. which rose 4.72 percent, and Datang Telecom Technology Co. up 5.02 percent.
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