Kmart recast as urban store
Kmart Corp emerged from bankruptcy yesterday as a smaller and more urban-based merchant, ending the largest reorganization by a US retailer almost 16 months after seeking protection from creditors. Kmart, the No. 3 US discounter, formalized an agreement with creditors that leaves ESL Investments Inc, the hedge fund run by Edward Lampert, as its largest investor with about a 50 percent stake. The company won court approval two weeks ago for the reorganization plan that erased US$7.8 billion in debt. The retailer slashed about 57,000 jobs while closing 599, or one third, of its stores. Many of the outlets Kmart is left with are in or near older urban areas after it failed to compete with bigger rivals Wal-Mart Stores Inc and Target Corp in suburban and rural locations.
■ IPR protection
Communists purge piracy
More than 48,000 fake music, video and computer discs and over 1,200 books have been destroyed in Hanoi in a purge against piracy, Vietnamese officials said yesterday. A further 6,000 "illegally printed products" ranging from calendars to banners were burnt as the VCDs, DVDs, CDs and CD-Roms were ground into pieces and then cere-moniously crushed by a steamroller. Of the books destroyed, 210 contained "bad content" and 1,015 "superstitious content." The communist government still remains suspicious about pagan and other traditional beliefs, fearing they could undermine its power. Pirated goods, ranging from designer luggage to computer soft-ware, are widely available for sale in Vietnam despite repeated warnings from the World Bank about the negative impact on foreign investment.
■ Free trade
WTO approves sanctions
The EU yesterday was due to get the final go-ahead to hit the US with a record US$4.04 billion worth of trade sanctions in a long-running row over tax breaks for major exporting firms, diplomats said. The WTO was set to approve a detailed list of products against which the EU can retaliate, clearing the last hurdle to the levying of the punitive duties which the Geneva-based trade referee had agreed last August. Under WTO rules, authorization by the organization's Dispute Settlement Body yesterday afternoon is effectively automatic -- it would need a unanimous decision of all 146 WTO members, including the EU, to block it, diplomats noted. However, the EU says it will not use the new powers as long as the US government and Congress make progress on reforming a system it says gives US firms an unfair trade advantage.
Yamaha's profits increase
Yamaha Motor Corp's second-half profit rose almost seven times because of cost cuts and more sales of two-wheelers and all-terrain vehicles in the US and Asia. Group net income for Yamaha, the world's second-largest motorbike maker, jumped to Japanese Yen 14.1 billion (US$120 million) in the six months to March 31, from Japanese Yen 2.05 billion a year earlier. Sales rose 8.6 percent to Japanese Yen 487.2 billion, from Japanese Yen 448.5 billion. Second-half figures were derived by subtracting first-half results from those for the full year. Yamaha plans to trim total costs 30 percent. The company will rely more on sales of smaller, cheaper bikes in Southeast Asia and China as demand in the US, its most profitable market, slows and the yen strengthens against the US dollar.