Business Brief for December 10, 2005
Saturday, December 10, 2005
These are short blurbs about current events in the business world.
Alltel to spin off wireless unit
Alltel intends to spin off its local-telephone unit and merge it with Valor Communications Group. The deal, worth $4.9 billion, will create a local-telephone company with a rural focus and 3.4 million access lines in 16 states. The deal forecasts $40 million in cost savings annually. The deal still requires shareholder and regulator approval and if approved will close by mid-2006. This leaves Alltel to concentrate on it's wireless services. Alltel said it plans a $3 billion share buyback program after it completes the spinoff in mid-2006. Alltel stock is up 10.3 percent this year.
- "UPDATE 3-Alltel to spin off unit in $4.9 bln deal plus debt" — , December 9, 2005
- Chuck Bartels. "Alltel to expand core business with deal" — , December 9, 2005
Internet portal Yahoo! acquires del.icio.us
On Friday, Yahoo!, a website listed by Alexa to receive the most traffic, bought out del.icio.us, a website used for sharing favorite web pages. Yahoo claims that this acquisition does not have a major financial impact on them, and that del.icio.us will still run as an independent website. del.icio.us currently has over 300,000 members since the website's creation two years ago.
Coke plans to sell Coffee under the Godiva brand
In the North American market, Coca-Cola plans to launch a line of ready-to-drink coffee in the second half of 2006, according to the industry magazine Beverage Digest. The drinks will be offered under the Godiva brand name which already sells coffee in several flavors. The spokesmen for both companies would not confirm or deny the report. Mary Minnick, Coke's marketing chief, has earlier said that Coke intends to launch "indulgence coffees" in the North American market.
In the European market Coke intends to offer Coffee, named Coca-Cola Blak, in France next month. "We believe we have created a new category of soft drink an adult product in a carbonated beverage, and a whole new drinking experience. This brand is ideal for any part of the day when people are looking for renewed energy or simply to take a break," said Coke's VP of global core brands Marc Mathieu.
Coke has attempted to enter the coffee market before. A few years ago Coke acquired the brand Planet Java forming a joint venture with Nestle. The drink never caught on and was shelved.
- "Coke said to plan Godiva coffee drink" — , December 10, 2005
- Brian Tracey. "Coke thinks coffee-cola is it" — , December 8, 2005