Business Briefs - Monday

FINANCE

Billionaire buys Bear Stearns stake

A British investor has acquired a 7% stake in the U.S.' No. 5 investment bank for $860.4 mil, becoming one of its largest shareholders. Joseph Lewis, who runs investment firm Tavistock Group and controls 170 companies, disclosed that he has bought 8.1 mil shares in Bear Stearns BSC in an SEC filing. The investment firm's shares have fallen about 30% amid losses related to the mortgage market crisis, spurring speculation it will be a takeover target. Shares rose 2% to 107.50.

Blackstone makes first China buy

The private equity firm bought a 20% stake in China National BlueStar, a chemical company for $600 mil. This is its first deal in China since the Chinese government bought a $3 bil stake in Blackstone BX in May. BlueStar makes industrial silicon, titanium dioxide powder, chromate anhydride, epoxy resins and silicane cable materials. The investment is seen as relatively large as Chinese regulators have been reluctant to approve outside investments. Its shares rose 1.6% to 21.88.

Ceridian CEN, the payroll processor, and shareholder Pershing Square Capital Management settled the hedge fund's proxy contest, clearing the way for a $36-a-share buyout by Thomas H. Lee Partners and Fidelity National Financial. Shares edged up 0.6% to 35.01. CHEMICALS

Credit market woes delay buyout

Myers Industries MYE, a maker of plastic and rubber products, said its $778 mil buyout by private equity firm GS Capital Partners was postponed until Q4 due to tightening credit markets. The deal became the largest leveraged buyout thus far impacted by the sudden tightening of the commercial paper market last month. The lack of buyers for bonds tied to leveraged buyouts threatens to unravel some $330 bil in buyout and merger deals. Myers Industries MYE rose 1% to 20.94.

DIVERSIFIED

3M: Building, electronics weak

The manufacturer's MMM CEO, George Buckley, said he has seen no improvement in the construction or electronics industries. He said that for most of the year there was a softness in the consumer electronics area, but not so much in LCD TVs. Buckley said 3M would consider taking on additional debt for acquisitions. He added that given the current credit crunch, competition for acquisitions has thinned out. 3M fell 1.2% to 87.82.

TECHNOLOGY

New AMD design: 4 cores, 1 chip

The chipmaker launched a new product that it hopes will re-energize its sagging fortunes. AMD's AMD new "quad-core" server processor isn't the first chip with 4 cores -- Intel claimed that title -- but its chip is more energy-efficient, AMD says. Energy consumption is a growing issue for data centers, and that may give AMD an advantage over Intel INTL. Shares climbed 2.6% to 12.94.

Yahoo shake-up may disappoint

The Internet company's new strategic plan, which co-founder Jerry Yang promised in July to issue within 100 days, may not be unveiled within that timeline and appears unlikely to be dramatic, a published report said. After replacing ousted CEO Terry Semel, Yang was urged by investors and analysts to overhaul the company amid significant market losses to Google. But insiders say Yahoo executives discussed, but dismissed, major moves, such as outsourcing its search-ad efforts or laying off much of its more than 11,000 workers. Shares fell 2% to 23.30.

Arrow Electronics ARW, a maker of computer and electronics parts, said its North American components business will work with IBM IBM on advanced chip design and manufacturing services. Financial details were not disclosed. Arrow rose 0.85 to 41.62. IBM edged up 0.2% to 115.80. ENERGY

JA Solar inks silicon supply deal

The maker JASO of solar cells used to convert light to electricity said it inked a long-term contract to receive silicon wafers from JiangSu Shunda Semiconductor Develop Company. JA will prepay about $46.4 mil in three installments for the monthly deliveries. Its wafer supply from Shunda will increase over the pact's 41-month duration. JA also revised its monthly prepayment terms on an existing contract with JingLong Group. JA surged 3.3% to 40.19.

TRANSPORTATION

Airlines back off rate increases

Increased domestic fares implemented last week were withdrawn by U.S. airlines. According to farecompare.com, Delta DAL rolled back 10% of its fare increase. The fare tracking Web site said the move shows the pressure of low-cost airlines, which have not raised their prices. AMR Corp's American Airlines AMR, Continental and Northwest Airlines NWAC also scaled back their price hikes. Shares of Delta, American, Continental and Northwest fell.

LAN Airlines LFL, a Chilean carrier, said Aug. traffic jumped 21% as capacity increased 17.8%. Load factor rose 2 percentage points to 77.8%. Int'l passenger traffic grew 19.6%. Shares rose 1% to 15.76. GM, Ford seen forming health trust

In a bid to resolve health care concerns of its union workers, General Motors GM and Ford F are likely to establish a trust fund for health care costs to be administered by the United Auto Workers union, according to JPMorgan. The deal would be modeled after one adopted by Goodyear Tire & Rubber, and would be funded at 60-70 cents on the dollar, the firm said.

BUILDING

Weyerhaeuser may close plants

The paper and lumber giant said it may have to close plants and trim operations at its wood products business due to weak housing market. Weyerhaeuser WY said the market for wood products had not improved in Q3. Struggling housing markets have damaged demand for wood products over the past several months. Shares fell 0.7% to 66.85.

MEDICAL

Pfizer warns on AIDS medicine

The drug maker warned health care professionals that its HIV drug Viracept contains some traces of a potential human carcinogen. Pfizer noted the presence of ethyl methanesulfonate, a process-related impurity, in Viracept. In June, Roche recalled all packs of Viracept in Europe due to similar concerns, but Pfizer said its found relatively low levels of the impurity and planned no recalls. Shares fell 1.2% to 23.96.

Sanofi-Aventis SNY paid $190 mil to settle allegations that it inflated the price of antinausea drug Anzemet in Medicare claims, the Justice Dept. said. It rose 0.3% to 41.24.