Hewlett-Packard once again raised its offer for storage company 3PAR on Thursday, outbidding Dell’s revised deal made earlier in the day.
HP’s new offer is $27 per share, up from its previous bid of $24 a share and Dell’s latest offer of $24.30, which was made Thursday morning.
The deal values 3PAR at $1.8 billion, up from the $1.6 billion that Dell offered. HP’s latest bid represents a 180% premium over 3PAR’s closing price of $9.65 the day before Dell’s initial bid.
Both Dell and HP submitted bids for the company last week, but HP raised its bid to just under $1.6 billion after Dell’s initial $1.15 billion offer was announced publicly. On Wednesday, 3PAR told Dell that Dell had three days to raise its offer, or it would go with HP’s deal.
"Not only is our offer superior to Dell’s proposal, HP remains uniquely positioned to execute on this combination given the number of synergies between the two companies," said Dave Donatelli, general manager of HP’s servers and storage unit, in a prepared statement.
As part of 3PAR’s revised deal with Dell reached Thursday morning, the storage company would owe Dell $72 million if it accepts HP’s higher offer business
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First Fidelity Bank is acquiring deposits previously held by the Arizona operations of Home National Bank.
Oklahoma-based RCB Bank acquired all 15 branches of Home National Bank from the FDIC on July 9.
Under the purchase contract with RCB, First Fidelity Bank will expand its Phoenix-area market presence with the acquisition of approximately $80 million in deposits. First Fidelity says the transaction will close in roughly 90 days, subject to regulatory approval. Previous HNB Phoenix branch locations will operate under the RCB Bank name until then.
Oklahoma City-based First Fidelity is a family-owned, privately held full-service financial institution founded 90 years ago paperless payday loans. It expanded into the Arizona market with a loan production office in 2003. It has since grown to four Valley-area offices through a 2007 merger with the former Western Security Bank.
First Fidelity has 28 offices serving the Oklahoma City, Tulsa, Phoenix and Scottsdale markets. The bank has total assets of more than $1 billion.
For more: www.ffb.com.
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Nearly 200,000 homebuyers could lose out on the $8,000 tax credit because they can’t get deals done by the June 30 deadline.
What did they do wrong? They tried to take advantage of the distressed properties flooding the market.
For example, many are trying to take advantage of short sales, buying from sellers who owe more on their mortgage than the home is worth. In these deals, the lender has to agree to forgive the remaining debt, and that can take time — at least two to three months from the time an offer is made until lender approval. And that assumes a relatively clean deal, in which there’s no second mortgage. If there are any complications, expect six months or more.
"The lenders have improved but they’re still terrible," said Richard Smith, CEO of Realogy, the parent company of several franchise real estate brokers. "We started telling buyers back in January that short sales may not close in time for the credit."
Another factor slowing down closings is what gets found during inspections. The average foreclosed property comes with more maintenance and repair problems than conventional sales. Fixing those can take time, said Rick Davidson, CEO of Century 21.
Meanwhile, all deals these days are at risk because of appraisal issues. With home prices still shaky, mortgage lenders have gotten strict about making sure that the sale price is not inflated.
"New mortgage money is so concerned about pricing, they require another appraisal a couple weeks before closing," said Smith. "They’re consumed with value." Lining up an appraiser and getting a report can add days, even weeks to the time it takes to close.
Congress is mulling an extension that would allow people to finish their transactions as late as Sept. 30 and still claim the credit — as long as they signed sales contracts before the original April 30 deadline.
"Brokers and agents are concerned that if Congress does not pass an extension, many of these homes will end up back on the market, defeating the whole purpose and benefit of the tax credit," said Tara-Nicholle Nelson, a spokeswoman for real estate website Trulia.
But the extension is hardly a sure thing, according to Regan Lachapelle, deputy communications director for Senate Majority Leader Harry Reid, who introduced the measure. "We are still working to get the votes we need," said Lachapelle.
It is not the kind of view you expect these days in downtrodden Michigan. From this rooftop plaza on the 17th floor of Bridgewater Place, evidence of urban renewal spreads in every direction. Directly to the south is the modern campus of Grand Valley State University, home to 11,000 students. Across the Grand River lies the sprawl of the redeveloped entertainment district, with its new arena and convention center, steps away from downtown business and government office buildings. Atop a hill to the east is the city’s crown jewel: a $1 billion (and growing) medical complex that includes a cancer research center, specialized treatment facilities, and a medical school.
This is Grand Rapids, a small city (pop. 200,000) in western Michigan with a redevelopment plan that has lessons for other cities looking to engineer new growth after the decline of old-economy industries. That this plan has taken hold in, of all places, the Rustbelt of Michigan makes it all the more remarkable. Two decades ago the city could have been headed the way of Flint, Pontiac, and, yes, Detroit. But instead its fortunes have steadily improved, thanks to a remarkable combination of business leadership, public-private cooperation, and the deep pockets of local philanthropists.
Grand Rapids is much smaller than that city on Michigan’s eastern coast, Detroit (pop. 800,000). Its populace is a bit more diverse, its suburban leaders were willing to work with city government, and its issues were much less complex. But at a moment when corporate, philanthropic, and political leaders in Detroit are just beginning the process of working together to help revive the city (see "Downsizing Detroit" on time.com), the Grand Rapids reinvention is worth examining. For years Detroiters were promised that one master project after another would solve their woes. None did. But in Grand Rapids, business leaders painstakingly set goals, aligned with government officials, generated support, and empowered key players. "Every community has a culture, and you have to pick out what works in your own town," says Birgit Klohs, the energetic head of Right Place, a local economic development group. "You have to figure out who the leaders are, get them onto a team, create the vision, and get everybody headed in the same direction."
During the dismal recession of the early 1990s, things were not going well in a town some still call "Bland Rapids." Sure, the city had the Gerald R. Ford Museum, honoring its most famous citizen. But its signature furniture-making industry had long since given way to more anonymous auto parts and steel office furniture, businesses that were both hit hard by the economy. And while Grand Rapids was suffering from statewide and national economic trends, the pain was local: high unemployment, a lifeless downtown, and little to build upon for the future, given its dependence on cyclical industries with scant growth potential.
But Grand Rapids had an unusual set of assets. "The wealth in this city in proportion to its size is extraordinary," says John Canepa, who retired as chairman and CEO of Old Kent Bank. Much of that wealth is in companies, many closely held, like Amway, the direct seller of health and beauty products; Meijer’s, a supermarket chain; and Steelcase (SCS), the office furniture giant. The founders of those companies or their descendants still reside in the Grand Rapids area, and match their deep roots with deep pockets of philanthropic dollars. Says David Van Andel, son of Amway co-founder Jay Van Andel: "If you want to be a player in this community, it is give first and get later."
Back in 1991, the community needed lots of giving. So Dick DeVos, son of Amway’s other founder, Rich DeVos, convened a group of more than 50 community and civic leaders to begin the process of revitalizing downtown. The group, which at first called itself Grand Vision, began making plans for an entertainment and sports arena and the expansion of local convention facilities. Rather than tackle the project on its own, the group conducted a feasibility and economic-impact analysis and studied the project for two years. Then DeVos got together with Canepa and David Frey, another local banker, to make the plan a reality. "We decided," says Frey, "that we were not going to let the economic vagaries of the state define our city." They built community support and went to work.
The group, renamed Grand Action, was able to do so courtesy of $21 million from a group of private donors led by Jay Van Andel, who was awarded the privilege of having the arena named after him. (As you’ll see, the city is awash in buildings named for its wealthy patrons.) The arena had reasonable goals and was an immediate success.
The arena was the start of a 20-year effort that hasn’t stopped. In cooperation with city officials, business leaders revamped downtown. One strand of the plan was designed to woo and satisfy visitors. A gift from Amway’s Rich DeVos led a $33 million fundraising effort toward construction of a $212 million convention center that bears his name. To comfortably house all those conventioneers, DeVos and Van Andel sponsored the building of a new J.W. Marriott Hotel downtown. And to entertain them, other givers added even more. After watching a play from the balcony of the aging Civic Theatre, supermarket magnate Fred Meijer decided to help finance a $10 million renovation — which was then rechristened the Meijer Majestic Theater. Steelcase heir Peter Wege gave $20 million to help fund the creation of an art museum (which for some reason does not bear his name). And the 132-acre Frederik Meijer Gardens and Sculpture Park … well, you can figure out who helped fund that beauty.
But the plan was more far-reaching than simply a play for tourists. Grand Action knew it had to lead the city into growing businesses, and plunged into two areas that have grown quite nicely in the past couple of decades: education and health care. With the help of local businessmen — Rich DeVos, Ford adviser William Seidman, banker Dick Gillett, and Steelcase executive Bob Pew — Grand Valley State University built a satellite campus on the Grand’s west bank, with Steelcase donating much of the land. And Frederik Meijer donated more land for yet another campus to the west of Grand Rapids, in a suburb called Holland, a name that reflects the region’s deep Dutch roots.
In health care, the catalyst was once again a private donor — this one with a very personal reason for the investment. In 1996, Jay Van Andel decided to fund a new institute for biomedical research, with an emphasis on cancer and Parkinson’s — the disease that contributed to his death in 2004 at the age of 80. Outsiders urged him to erect it on a greenfield site outside the city or, more sensibly yet, to connect it to the University of Michigan medical school across the state in Ann Arbor. Van Andel decided his institute belonged in Grand Rapids. "They told us we were nuts," recalls his son David, who heads the institute. "We had no affiliation with any medical school, no history of medical research. But our family had a big stake in the community."
The result of all this hard work? Exactly what Grand Action had hoped for: a more stable economy, one that can better withstand the ups and downs of economic trends. Now, manufacturing ranks as the region’s second leading employer, replaced at No. 1 by those sectors poised for the demographics of the early 21st century: education and health services.
Despite its intensive redevelopment, Grand Rapids has not solved all its problems. Unemployment is still high. Michigan’s manufacturing decline, which has emptied thousands of square feet of factory space in the city, has disproportionately hit minorities. But 20 years of reinvention have seeped into the city’s blood. Grand Rapids is now trying to redefine itself as the greenest city in the U.S. It claims more LEED-certified buildings per capita, a measurement of environmentally friendly design, than any city in the U.S.
It’s this kind of planning, a continual reinvention with clear goals, that has been lacking in Detroit. For years city leaders failed to deliver a long-term vision of an economic future that could alleviate the impact of a declining auto industry. Now, with a businessman mayor, Dave Bing, who imagines a reinvention driven by private and public capital, the city is trying to embark on such a plan. In Grand Rapids they’re rooting for their bigger neighbor to the east. "We cannot afford to see Detroit fail," says Mayor George Heartwell. But if Grand Rapids’ recovery took two decades, how long will it take Detroit?
Toyota is planning to suspend production at two U.S. plants as sales lag following the automaker’s massive recall of its vehicles.
Mike Goss, a Toyota spokesman, said the company will retain all of its workers during the suspensions, which will take place at plants in Kentucky and Texas in the weeks ahead.
The temporary shutdowns are aimed at adjusting production levels following a series of recalls that forced Toyota to halt sales of some of its most popular models.
"We don’t want inventory to build up for our dealers," Goss said. "We can’t keep sending vehicles to dealers until they can start moving those vehicles."
He said the company has used other methods to slow production in the past, such as limiting overtime, but that "elimination days are kind of the final step in that process."
The Kentucky plant, where Toyota’s top-selling Camry is made, will not produce cars on Feb. 26. Goss said the plant could go dark on a few more days the following week, though no official plans have been made.
The Texas plant will halt production the week of March 15 and again in mid April. The plant, where Toyota makes Tundra pickup trucks, will be modified to begin producing Tacoma trucks during the suspension, Goss said.
Toyota has recalled more than 8.1 million vehicles worldwide for problems related to sudden acceleration and unresponsive break pedals, among other things. The company has apologized for the safety lapses and pledged to repair the recalled vehicles quickly.
Meanwhile, the number of customer complaints filed with federal safety regulators has spiked in recent weeks. According to the National Highway Traffic Safety Administration, there have been a total of 34 Toyota complaints alleging fatalities since 2000.
The widely publicized safety issues have taken a toll on sales. Earlier this month, Toyota said January sales fell 16% from a year earlier, worse than a forecast of a 12% year-over-year decline from sales tracker Edmunds.com.
To help revive sales, the automaker is considering a variety of incentive options aimed at drawing customers back into its showrooms.
At the same time, Toyota has launched a public relations campaign aimed at salvaging the company’s once-sterling reputation.
Toyota’s president, Akio Toyoda, and other company executives will take questions about the recall efforts Wednesday at a press conference in Tokyo.
The company has been ramping up lobbying, consulting and attorney teams ahead of appearances on Capitol Hill. Toyota is scheduled to go before two House committees next week and a Senate committee next month.
NEW YORK — Wal-Mart Stores Inc. will cut about 11,200 jobs at Sam’s Club warehouses as it turns over the task of in-store product demonstrations to an outside marketing company.
The move is an effort to improve sales at Sam’s Club, which has underperformed the company’s namesake stores in the U.S. and abroad.
The cuts represent about 10 percent of the warehouse club operator’s 110,000 staffers across its 600 stores. That includes 10,000 workers, most of them part-timers, who offer food samples and showcase products to customers. The company also eliminated 1,200 workers who recruit new members.
Employees were told the news at mandatory meetings on Sunday morning.
"In the club channel, demo sampling events are a very important part of the experience," said Sam’s Club CEO Brian Cornell in a phone interview. "Shopper Events specializes in this area, and they can take our sampling program to the next level."
Shopper Events, based in Rogers, Ark., currently works with Wal-Mart’s namesake stores on in-store demonstrations. Sam’s Club is looking to the company to improve sampling in areas such as electronics, personal wellness products and food items to entice shoppers to spend more.
Sam’s Club has performed more poorly than Wal-Mart Stores Inc.’s namesake stores in the U.S. and abroad. Cornell has been working to improve results since taking the helm in early 2009, introducing new store formats, price cuts and offering more variety and more brands of items from take-home meals to baked goods.
As consumers eat out less in the shaky economy, Sam’s Club has tried to steal customers from grocery chains and rival warehouse stores such as Costco Wholesale Corp no fax payday loans. by offering more everyday goods such as food and health and beauty items and by paring its assortment of general merchandise such as furniture and clothes.
But in Wal-Mart Stores’ most recent quarter, revenue at the Sam’s Club division slipped nearly 1 percent to $11.55 billion while U.S. Walmart stores posted a 1.2 percent sales increase to $61.81 billion. Earlier this month, Wal-Mart Stores closed 10 underperforming Sam’s Club locations, resulting in the loss of about 1,500 jobs.
"Sam’s has been the relative laggard, and it has lagged relative to its direct competitors, Costco and the smaller BJ’s (Wholesale Club)," said Craig Johnson, president of retail consultancy Customer Growth Partners.
The move to outsource its food sampling efforts is a way for the company to tout its fresh food offerings in a cost-effective manner, Johnson said.
—"’Fresh’ is where the real competitive battles are being fought in the club sector," he said.
Shopper Events will launch a new demo program called "Tastes and Tips" with new carts, signs, uniforms and a trained team, said Cornell. He said the move was not made to save money.
"It’s not a cost-cutting measure, it’s really an investment in enhancing our demo program," he said. Cornell added that Shopper Events planned to hire "roughly the same number of people" cut, and said Sam’s Club workers are invited to apply for those positions.
Television shopping giant QVC said Black Friday generated more than $32 million in orders - a 60 percent increase over last year’s sales.
That represents 765,000 units ordered in a 24-hour period for the shopping channel, which offers its own brand of holiday specials. Officials called its programming “the largest and most aggressive Black Friday event in the multimedia retailer’s 23-year history.” That meant lots of deals and much less talk.
QVC.com contributed 40 percent of the sales.
Top sellers included a Sylvania digital camcorder, Playhut Travel Lounger, Nintendo Wii, Olympus 5x zoom Camera.
The U.S. economic recovery will extend into next year as manufacturing expands and the pace of firings abates, reports today indicated.
The Conference Board’s index of leading indicators, a gauge of the outlook for the next three to six months, rose 0.3 percent in October, preserving a string of gains that began in April. Other reports showed claims for jobless benefits held at a 10-month low and Philadelphia-area manufacturing accelerated.
The rally in stock prices, low short-term interest rates and slowing job losses that propelled the leading index signal consumer confidence and spending are likely to stabilize, limiting the risk the economy will retrench. The data supported Treasury Secretary Timothy Geithner’s forecast today that the emerging expansion will be sustained into 2010.
“It’s very clear that the economy is now expanding, but I don’t see it being a vigorous expansion,” said Michael Moran, chief economist at Daiwa Securities America Inc. in New York, who correctly forecast the leading index. “We are seeing a gradual improvement, but the key word is ‘gradual.’”
Stocks extended a global drop as concern grew that the rally outpaced the prospects for economic growth and Bank of America Corp. downgraded chipmakers. The Standard & Poor’s 500 Index fell 1.3 percent to close at 1,094.9, with Intel Corp. and Texas Instruments Inc. losing ground.
Economists forecast the leading indicators index would increase 0.4 percent, according to the median of 58 estimates in a Bloomberg News survey.
Geithner Forecast
“We expect continued growth in the fourth quarter and ahead in 2010,” Geithner said today in testimony before the Joint Economic Committee of Congress.
He urged Congress to pass a financial regulation overhaul intended to strengthen the banking system and guard against “market-driven excess,” to avoid a repeat of the worst crisis since the Great Depression. Congress is considering a plan that includes changes to oversight of large banks, consumer protection and derivatives.
Federal Reserve Chairman Ben S. Bernanke last week said “significant economic challenges remain” due to a weak labor market and reduced bank lending.
The number of Americans filing claims for unemployment benefits held at 505,000 in the week ended Nov. 14, matching the prior week’s reading as the lowest since January. The number of people collecting unemployment insurance dropped in the prior week, while those getting extended payments jumped.
‘Glacial Pace’
“The labor market is improving, but at a glacial pace,” said Tom Porcelli, a senior economist at RBC Capital Markets in New York, who had forecast claims at 503,000 . “People are having a hard time finding a job as companies remain wary of the economic recovery.”
President Barack Obama on Nov. 6 signed into law a plan to extend jobless benefits, expand a tax credit for first-time homebuyers, and provide tax refunds to money-losing companies. The measure gives jobless people as many as 20 additional weeks of unemployment assistance.
The president has also announced plans to convene a jobs summit at the White House next month.
Manufacturing in the Philadelphia region expanded in November at the fastest pace in more than two years, reflecting gains in orders and sales, figures from the Fed Bank of Philadelphia also showed today.
Factory Rebound
The bank’s general economic index rose to 16.7 this month, exceeding the median forecast of economists surveyed and the highest level since June 2007, from 11.5 in October. Readings greater than zero signal growth.
Six of the 10 components in the leading index contributed to last month’s increase, led by the difference between short- and long-term borrowing costs, fewer jobless claims and higher equity prices. A longer factory workweek, a rise in money supply and an increase in factory orders for consumer goods also helped. Weaker consumer expectations, fewer building permits, shorter delivery times and a drop in orders for business equipment limited the advance.
Manufacturers that export to China and other emerging economies are among companies profiting from growth abroad. Caterpillar Inc., the world’s largest maker of bulldozers and excavators, posted third-quarter earnings that beat analysts’ estimates and issued a full-year forecast that exceeded the highest prediction.
“We are seeing encouraging signs that indicate a recovery may be under way,” Chief Executive Officer Jim Owens said in a statement Oct. 20. “When it comes, it can come quickly, and we, our dealers and our suppliers will be prepared.”
The world’s largest economy probably expanded at a 3 percent annual pace from October through December after growing at a 3.5 percent rate in the prior quarter, according to the median estimate of economists surveyed earlier this month. That followed a 3.8 percent contraction in the 12 months to June, the economy’s worst performance since the 1930s.
The U.S. recession that began in December 2007 cost the top metropolitan areas all of the 2.29 million jobs they had gained in the previous expansion, according to a report released on Wednesday.
“All of the job growth that occurred in the top U.S. metropolitan areas from August 2000 through August 2007 was erased by the subsequent recession,” New York City Comptroller William Thompson said in a quarterly economic report.
The net loss is 7,000 jobs.
The two mature cities with the biggest job losses were Chicago, whose employers cut 257,700 workers, and Detroit, which lost over 467,400 jobs, the report said.
Boston lost 103,500 jobs, followed by Minneapolis-St. Paul, with a loss of 35,500 positions; St Louis, which shed 28,400 jobs, and Philadelphia, where 21,400 positions were lost.
But there were two upbeat notes in this sour trend.
In spite of the financial crisis on Wall Street and thousands of high-paying jobs lost after Lehman Brothers filed for bankruptcy in September 2008 and other banks merged, New York City emerged as part of a positive trend over the entire nine-year period covered by the city comptroller’s report.
The New York-New Jersey area was one of only two “mature metropolitan areas” that succeeded in increasing jobs from August 2000 to August 2009. The New York-New Jersey area added 95,700 positions over that nine-year period, according to the report from Thompson, a Democrat.
Baltimore was the other bright spot, chalking up a gain of 26,500 jobs in that nine-year period,
But in the last expansion, New York City underperformed Washington, D loans until payday.C., Baltimore and Philadelphia in increasing the number of high-paying professional and business services jobs that tend to face less of a threat from foreign rivals than manufacturing, for example.
FEELING WALL STREET’S PAIN
Although New York City fared better than some of its peers, the city comptroller’s report revealed the widespread devastation caused by Wall Street’s implosion due to the credit crunch and the stock market’s slide after the housing market’s bubble burst. A total of 40,000 financial jobs have been lost since August 2007. And the city’s jobless rate jumped to 10.3 percent in September from 6 percent a year-ago.
New York City’s fortunes rise and fall with Wall Street because banks and brokerages spur hiring in service sectors, from florists to law firms, during profitable years.
General sales-tax collections fell 12 percent in the third quarter from a year ago, while income taxes withheld from paychecks dropped 7.2 percent. Manhattan’s office vacancy rate shot up to 11.1 percent in the third quarter — the highest level since the 2004 third quarter, the report said, citing Cushman & Wakefield data.
How swiftly the city exits the downturn rests partly with Congress. The federal government’s newfound zeal for reining in Wall Street’s risk-taking and compensation could crimp the financial industry’s ability to kickstart the city’s economy.
A spate of attacks in Pakistan’s Punjab as Islamic militants work more closely with the Taliban has raised business concern in the province that generates more than half of the country’s economic growth.
Forty-two people were killed last month in Punjab, home to Pakistan’s largest bank and companies producing clothing for retailers Levi Strauss & Co. and Gap Inc. Recent increases in surveillance and arrests are unlikely to reverse the violence that killed more than 220 people in the province in the first 10 months of this year, 20 percent more than 2008, said Ayesha Siddiqa, a Punjabi researcher on military and security issues.
The Karachi Stock Exchange 100 Index fell 2 percent last month, the most since January and only the third negative month this year, as bombings and militant assaults in major cities nationwide hurt investor confidence.
“The implications of this war spreading to Punjab are pretty severe,” said Standard Chartered Plc economist Sayem Ali in Karachi. Punjab represents 55 percent of Pakistan’s gross domestic product, he said. With foreign direct investment down by 60 percent in the three months to September, “our domestic security problems cloud companies’ strategies for coming back into Pakistan any time soon.”
Since the army began its biggest anti-Taliban offensive on Oct. 17 near the border with Afghanistan, bombings have killed about 350 people nationwide, mostly civilians.
Cricket Ambush
While Punjab has seen fewer terrorist attacks than Pakistan’s ethnic Pashtun northwest, guerrillas in Lahore attacked three police headquarters last month and ambushed the Sri Lankan national cricket team’s bus in March. Militants last month raided the army headquarters in Rawalpindi, also in Punjab. The province is home to about half of the country’s 180 million people.
The government must continue to stand up to the guerrillas or “the violence will continue to spread and investors will not feel safe anywhere” in Pakistan, said Habib-ur-Rehman, who manages $48 million of stocks and bonds at Karachi-based Atlas Asset Management Ltd.
Punjab is home to much of Pakistan’s textile sector and the nation’s largest bank by market value, MCB Bank Ltd. Textiles account for two-thirds of the country’s exports in a $165- billion economy.
Pakistan’s overseas direct investment fell 58 percent to $463 million in the three months ended Sept. 30, from $1.1 billion a year ago, according to data from the central bank.
Surveillance Cameras
“We have to keep so many security guards, set up surveillance cameras at the factories,” said Raza Mansha, chief executive of D.G. Khan Cement Ltd., Pakistan’s second-biggest cement maker, based in Lahore, Punjab’s capital and the country’s second-largest city. It “adds to our non-productive expenses and gives foreign visitors a bad impression guaranteed online payday loans.”
D.G. Khan Cement and MCB Bank are part of the Nishat Group, Pakistan’s largest industrial group. D.G. Khan shares fell 16 percent in October and have risen 4.3 percent this month. MCB was down 4 percent in October and is up 7 percent this month.
The benchmark share index has gained 56 percent this year after losing 59 percent in 2008. It rose 2.6 percent yesterday.
Interior Minister Rehman Malik told reporters last month that at least two Punjab-based groups — Jaish-e-Muhammad (Soldiers of Muhammad) and Lashkar-e-Jhangvi (the Army of Jhang, a southern Punjab city) — were operating jointly with the Taliban and al-Qaeda to attack the Pakistani state.
Limited Crackdown
Still, Pakistan’s crackdown on jihadist groups in the province has been limited, and won’t reverse the decades of growth that have made the militant groups a durable part of the political landscape, said Siddiqa.
“The state’s response really has been business-as-usual — selective pressure” rather than a systematic campaign against Islamic radicalism, Islamabad-based Siddiqa said in a phone interview.
For Umer Mansha, chief executive officer of Lahore-based Nishat Mills Ltd., that’s a worrying message. His company produces garments for San Francisco-based Levi-Strauss, the closely held maker of blue jeans and Dockers pants, and Gap, based in the same U.S. city and operator of the Old Navy and Banana Republic chains.
“Textile buyers like to come, see and feel the product,” Mansha, whose company is also part of the Nishat Group, said in an interview Nov. 12. “Buyers are simply not willing to come here. It’s very hard to get new clients.”
More Than Last Year
More than 10,000 Pakistanis — civilians, security forces and militants — have died in the country’s violence this year, a rate 75 percent higher than last year’s record, according to the New Delhi-based Institute for Conflict Management.
“The tactics used in recent attacks in Punjab, plus the literature recovered by police in making arrests, shows that there is more coordination and contact now between Punjab militants and the Arabs of al-Qaeda,” said Muhammad Amir Rana, director of the Islamabad-based Pak Institute for Peace Studies.
Punjab Home Ministry and police officials didn’t respond to phone calls and e-mail messages asking how many alleged perpetrators have been detained in the province.
The “poverty of southern Punjab in particular, and the covert support and funds that militants have had” from Arab donors and Pakistan’s military, “have let them build durable organizations,” said security researcher Siddiqa. “Militancy in Punjab is now a fixture.”
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