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Tue, Oct 28, 2003 - Page 12 News List

World Business Quick Take

AGENCIES

■ Motoring
Fiat, GM delay agreement

Fiat SpA and General Motors Corp agreed on Sunday to delay by a year the start of agreement that would allow the Italian carmaker to sell its struggling auto unit to the US giant. GM currently owns 20 percent of Fiat Auto, and Fiat SpA had the right to sell the remaining 80 percent to GM starting next year. However, under the new agreement, the exercise of the "put" option will be delayed until Jan. 24, 2005, and will last until 2010. The move came as Fiat flails with major losses in its auto unit, and tries desperately to rebuild the company. Despite these problems, top Fiat officials have said repeatedly that they do not want to use the put option. Fiat reported a US$4.7 billion net loss last year.

■ Soft drinks

Cadbury plans job cuts

Cadbury Schweppes PLC, the world's third largest soft-drink producer and a leading confectionery maker, said yesterday it plans to cut 10 percent of its 55,000-strong global work force. The company also said it plans to close some 20 percent of the 133 factories it operates worldwide. Cadbury said it expected the moves to yield savings of US$640 million a year by 2007. The company did not specify in which countries the job cuts would be made, and a spokeswoman could not immediately be reached for comment. But chief executive Todd Stitzer said that "as and when we take action, people will be spoken to sensitively and thoughtfully." Confectionery sales suffered during the European heat wave in August, and the company has also complained of tough market conditions in the US beverages market and the Asia-Pacific region.

■ Television

Sharp focusing on LCDs

Japan's Sharp Corp announced yesterday that it will double capacity for liquid-crystal display (LCD) televisions to 40,000 units a month at its factory in Barcelona, Spain, next April. "The European LCD TV market has been expanding faster than we expected. We are increasing our production capacity [in Europe] to deal with the growing demand," said Masaaki Takeda, Sharp spokesman. The Barcelona plant will stop making cathode-ray tube TVs by the end of the year, he said. Sharp will eventually make similar changes at factories in Mexico and China, although the exact timing for the move is not set yet, he said. The company plans to only make LCD TVs in Japan by 2005, he said.

■ Telecoms

China buys networks

China Telecom Corp Ltd, China's largest fixed-line telephone operator, has agreed to buy six provincial networks from its parent for 46 billion yuan (US$5.5 billion) to boost revenue and expansion, the firm said yesterday. China Telecom said in a statement that it will take over networks in Anhui, Fujian, Jiangxi, Guangxi and Sichuan provinces, as well as in Chongqing, from China Telecommuniations Corp, which owns 77.78 percent of China Telecom. The Hong Kong-listed firm said the total acquisition price includes a cash consideration of 11 billion yuan paid upon the closure of the deal and another 35 billion yuan, due in 10 years. China Telecom expects its telecom assets to generate net profit of 6.352 billion yuan this year. The deal will also boost China Telecom's user base by about 74 percent.

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