Pacific Northwest Northrop Grumman and Boeing both said the U.S. Air Force discovered errors in its calculation of the operating costs...
Errors found in tanker costs
Northrop Grumman and Boeing both said the U.S. Air Force discovered errors in its calculation of the operating costs of the competing aircraft in the aerial-refueling tanker contest that Northrop won in February.
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Northrop said in a statement Thursday that the “minor errors should have no impact” in the pending ruling on Boeing’s protest of that award.
Boeing, in a separate statement, said its case is “bolstered by new revelations” and that the Air Force now concedes that Boeing’s most probable life-cycle cost is lower than Northrop’s.
The Air Force said it cannot legally comment on the tanker proposals, the evaluation process or its selection decision. In a statement, however, the Air Force said it “stands by its process and its decision.”
The U.S. Government Accountability Office, a congressional watchdog agency, must make its recommendation on Boeing’s protest to the Pentagon by June 19.
35 new 737 orders worth $2.36 billion
Boeing won orders valued at about $2.36 billion at list prices for 35 of its 737 jets.
The planes, listed on Boeing’s Web site Thursday as having come from unnamed customers in the past week, bring the total orders for this year through June 10 to 453.
The 737’s order total for the year now stands at 336.
Sights set to attract 30 million by 2017
Clearwire, the high-speed wireless Internet company planning to combine with a Sprint Nextel unit, said it may attract more than 30 million customers by 2017.
If about 15 percent of people in its coverage area buy its service, Clearwire’s sales may reach $17.5 billion in nine years, Chief Financial Officer John Butler said Thursday at an investor conference in New York. The figures were part of a financial model outlining the company’s growth plans.
The Kirkland company now has about 450,000 customers in 50 markets, Chief Executive Officer Benjamin Wolff said.
More European outlets planned
Starbucks will open more than 150 outlets in European airports and train stations during the next three years with licensee SSP.
The agreement awards licensing rights for its brand that are exclusive in Germany and other countries, Seattle-based Starbucks said Thursday. SSP, a former unit of catering company Compass Group, sells food at travel-linked sites in 29 nations under brands from Upper Crust to Burger King.
Airline’s CEO eyed for board
Alaska Airlines Chief Executive William Ayer will be named chairman of Puget Energy’s board of directors if regulators consent to a takeover of the utility by a group of investors led by Australian investment bank Macquarie.
Puget Energy said Thursday that current chairman Stephen Reynolds, who is also chief executive officer, will remain on the board. Another incumbent director, Herb Simon, will also stay. The continuity of these directors is meant to ensure that the company will have leadership “firmly rooted in Washington” even after its purchase by the Macquarie-led group, said Reynolds in a statement.
Seven other members of the board, representing the interests of the consortium led by Australian investment bank Macquarie, will be announced when the merger is approved, the company said.
The $7.4 billion deal was announced last October, and approved by Puget Energy’s shareholders and the Federal Energy Regulatory Commission. The Washington Utilities and Transportation Commission, which has the last word, is scheduled to make a decision in September.
Merger talks end, stocks fall 7.4%
The stock of Greenbrier, the biggest U.S. railroad-flatcar maker, fell 7.4 percent Thursday after billionaire investor Carl Icahn said his American Railcar Industries is no longer in talks about a merger.
The Lake Oswego, Ore., company dropped $1.72 to $21.37.
Negotiations were terminated because of “certain unresolved issues,” Icahn said in a regulatory filing Wednesday. The two companies aren’t pursuing further discussions “at this time,” according to the filing.
“I don’t think Greenbrier’s management or some of the larger shareholders would really want to sell unless they got $32 to $34 a share,” said Longbow Research analyst Paul Bodnar. “I don’t think Icahn was ready to go there.”
Nation and World
Executive shake-up as losses mount
Lehman Brothers shook up its management Thursday, removing two top executives in a concession that attempts to quell Wall Street anger over recent losses have failed.
The nation’s fourth-largest investment bank said Chief Financial Officer Erin Callan and Chief Operating Officer Joseph Gregory have been removed from their positions, days after the investment bank announced a $3 billion quarterly loss.
Investors were shaken after the company disclosed Monday it needed $6 billion of fresh capital to offset that loss, its first since going public in 1994.
Stimulus checks lift retail sales
Retail sales jumped by the largest amount in six months in May as 57 million economic-stimulus payments helped offset the head winds buffeting consumers.
The Commerce Department reported Thursday that retail sales soared 1 percent last month, the biggest increase since November.
A wide variety of retailers enjoyed a good month, including the biggest increase at department stores and other general-merchandise stores in a year.
Retail gas outlets will be sold off
Exxon Mobil is getting out of the retail gasoline business, a market where profits have gotten tougher because of high crude-oil prices.
The world’s largest publicly traded oil company said Thursday it will sell its 820 company-owned stations and 1,400 more outlets operated by dealers to gasoline distributors across the U.S.
The Irving-based company didn’t disclose financial details but said the transition will take place over a number of years.
Invitrogen to buy Applied Biosystems
Invitrogen, which makes technologies for disease research and drug discovery, on Thursday agreed to pay $6.4 billion in cash and stock for scientific-instruments maker Applera’s Applied Biosystems Group.
Applied Biosystems is one of several competitors in the race to develop faster, cheaper DNA analysis devices for sequencing human genes. Earlier this year, the company announced it had sequenced an entire human genome for less than $60,000, down from the $3 billion spent on the Human Genome Project just five years ago.
Invitrogen makes a broad range of biochemicals and equipment used in government, academic and corporate medical-research labs.
The two companies’ complementary technologies “will drive the price of decoding that genome ever lower,” said Invitrogen Chief Executive Greg Lucier.
Compiled from Seattle Times staff, Bloomberg News and The Associated Press