While executives promoted their US$15.6 billion deal to unite Phillips Petroleum Co and Conoco Inc as a merger of equals, analysts described the combination as a deal done to survive. \nIf Phillips and Conoco hadn't decided to join forces, analysts said Monday, they risked losing market share to competitors in an unhealthy business climate for all but the largest petroleum companies. \n"This is absolutely a matter of survival -- survival not necessarily to thrive, but to guarantee they will survive," said Fadel Gheit, an analyst at Fahnestock & Co. "If oil and gas prices collapse, smaller companies will be swept away." \nOil prices have already plunged to their lowest level in more than two years despite efforts by OPEC to trim production and stop the free fall. Gas is now selling for less than US$1 a gallon in some parts of the country and is averaging US$1.23 a gallon at stations nationwide, according to the Lundberg Survey. \nIn a conference call with analysts Monday, top Phillips and Conoco officials said the merger will allow them to save at least US$750 million annually, in part through the elimination of an unspecified number of jobs from the combined company's roster of 58,000 employees. \nPhillips chairman James Mulva said it's too soon to say how many positions will be cut, but Gheit predicted about 10 percent of the work force would be eliminated. \n"You cannot say you are cutting costs if you cut less than 5 percent," Gheit said "And if you want to be aggressive with a sharp knife you can cut 15 to 20 percent, which I see as unlikely." \nThe combined company will be the country's top refiner and a gas retailing giant, with about 17,000 filling stations nationwide. Conoco sells gasoline, diesel fuel, and other petroleum products at 5,000 outlets in the US, while Phillips sells fuel at more than 12,000 stations under brands such as Phillips 66, Circle K, and 76. \nThe all-stock deal, announced Sunday, gives the new company -- named ConocoPhillips -- a US$35 billion market value. It puts it in the No. 3 position behind Exxon Mobil Corp and ChevronTexaco Corp in the US, and ranks it sixth-largest in the world. \nConocoPhillips will likely have reserves of 8.7 billion barrels of oil equivalent and daily production of 1.7 million barrels. \nOfficials took pains Monday to describe the deal as a merger of equals, though under its terms, Phillips shareholders will end up with a 56.6 percent stake in the new company and Conoco shareholders will own 43.4 percent.
CLOSE ENCOUNTERS: Several of the PLA fighter jets that crossed the median line of the Strait came within 68km of Hsinchu, drawing warnings from Taiwan, the ministry said At least 18 Chinese military aircraft yesterday flew into the nation’s air defense identification zone (ADIZ) on the second day of a US delegation’s visit, the Ministry of National Defense said, adding that the military responded by deploying an air defense missile system to monitor their activities. A delegation led by US Undersecretary of State for Economic Growth, Energy and the Environment Keith Krach on Thursday started a three-day visit to Taiwan. The ministry from Thursday started publicizing the actions of the Chinese People’s Liberation Army (PLA) in Taiwan’s ADIZ on its Web site and Twitter. According to ministry reports, 18 PLA aircraft
TWO CASES: The five allegedly conspired with conglomerates, threatening the nation’s governance and subverting the rules of ethical conduct, a deputy chief prosecutor said Taipei prosecutors yesterday charged three legislators and one former lawmaker with contravening the Anti-Corruption Act (貪污治罪條例) in a case linked to former Pacific Distribution Investment Co (太平洋流通) chairman Lee Heng-lung’s (李恆隆) battle with the Far Eastern Group (遠東集團) over ownership of the Pacific SOGO Department Store (太平洋崇光百貨) chain, while independent Legislator Chao Cheng-yu (趙正宇) was indicted in a separate case involving two funeral services companies and a plot of land in a national park. Chinese Nationalist Party (KMT) legislators Chen Chao-ming (陳超明) and Sufin Siluko (廖國棟), Democratic Progressive Party (DPP) Legislator Su Chen-ching (蘇震清) and former New Power Party legislator
PENGHU INSPECTION: Taiwan cannot let its enemies strut around in its airspace, Tsai said, one day after a Chinese spokesman denied a median line exists in the Taiwan Strait Following China’s assertion on Monday that there is no “median line” in the Taiwan Strait, President Tsai Ing-wen (蔡英文) yesterday pledged to defend the nation’s airspace during a visit to an air force base in Penghu, saying that Taiwan cannot allow others to flex their military muscle in its territorial airspace. Tsai praised the “heroic performance” of the pilots of the Indigenous Defense Fighters who have been intercepting Chinese People’s Liberation Army Air Force planes in recent days. “I have a lot of confidence in you. As soldiers of the Republic of China [ROC], how could we let enemies strut
Swedish Member of Parliament Hampus Hagman is pushing for changing the name of the nation’s trade office in Taipei to signal improved relations with “Asia’s perhaps foremost democracy.” Hagman on Wednesday last week proposed renaming the Swedish Trade and Invest Council to “Sweden’s Office in Taipei,” following similar changes by other nations. The Swedish Trade and Invest Council, part of Business Sweden, is owned by the Swedish government and Swedish industry. Taiwan and Sweden share important values such as respect for democracy, human rights, the rule of law and freedom of speech, Hagman said in the motion, adding that the two nations