The daily business briefing: February 20, 2018
Rite Aid shares soar on reported deal talks with Albertsons, Donald Trump Jr. heads to India to sell condos, and more
Rite Aid shares jump after report of deal talks with Albertsons
Rite Aid shares soared 23 percent higher in pre-market trading on Tuesday after The Wall Street Journal reported supermarket chain Albertsons was in talks to buy the remainder of Rite Aid not being sold to Walgreens. The partnership would create a company with revenue of $83 billion, and help Idaho-based Albertsons confront increasing competition from Whole Foods owner Amazon. The proposed cash-and-stock deal would give Albertsons shareholders 71 percent of the combined company, with the rest going to Rite Aid investors, the Journal reported. Representatives of the companies did not immediately comment.
Donald Trump Jr. starts India trip to sell condos
Donald Trump Jr., the president's eldest son, starts an unofficial trip to India on Tuesday to promote family real estate projects, although he also plans to make a foreign policy speech at an event with Indian Prime Minister Narendra Modi. Ahead of Trump Jr.'s arrival, newspapers have run ads inviting people to reserve condominiums in the latest Trump Tower project for a booking fee of $38,000 that will come with an invitation to "join Mr. Donald Trump Jr. for a conversation and dinner." President Trump has put his sons in charge of running the company although he hasn't divested, and ethics experts say the combination of the invitation to dine with Trump Jr. and his decision to make a policy speech present a potential conflict of interest.
GM to revamp Kansas plant to make Cadillac crossover SUVs
General Motors said Monday that it would spend $265 million to rework its plant in Kansas City, Kansas, to build the Cadillac XT4 crossover sport utility vehicle there. The plant currently has 2,235 workers making the Chevrolet Malibu, down from 3,000 after a cut due to slumping Malibu sales. GM spokeswoman Mary Padilla said assembling the Cadillac crossovers there will secure about 500 jobs. GM also is revising its plans in South Korea, where it last week announced that it would be shuttering one of its four factories. GM said it would decide the future of the other three within weeks. The South Korean government designated the city of Gunsan, home to the shuttered factory, an employment "crisis zone" after GM's announcement.
Walmart shares drop as quarterly earnings fall short of expectations
Walmart shares dropped by 4 percent in pre-market trading Tuesday after the retail giant reported quarterly adjusted earnings that fell short of analysts' expectations. Walmart said it made an adjusted $1.33 per share, but analysts polled by FactSet had projected $1.37 per share. Quarterly sales, however, beat expectations, with total revenue reaching $136.3 million, ahead of the $134.9 million FactSet estimate. Same-store sales in the U.S. rose by 2.6 percent, up from a 1.8 percent gain reported a year ago. Walmart made progress in its online efforts to battle Amazon, with online sales up 23 percent in the crucial holiday quarter and 44 percent on the full year.
Hundreds of KFC restaurants close in U.K.
Nine hundred KFC outlets in the U.K. and Ireland have been forced to shut down due to a shortage of chicken. The company issued an apology to customers and said the glitch was due to "teething problems" in working with DHL, its new delivery partner. "We know that this might have inconvenienced some of you over the last few days, and disappointed you when you wanted your fried chicken fix — we're really sorry about that," the company said in a statement. KFC said Monday that since the initial closures over the weekend, nearly 300 of the stores had managed to reopen.