Morgan Stanley to buy stock-plan firm
NEW YORK -- Morgan Stanley agreed to buy Solium Capital Inc. in a bid to add younger clients and tech startups to its stock-plan administration business.
The firm will pay $25.48 a share in cash, according to a statement Monday, or about 43 percent higher than Solium's closing price on Friday. The agreement values Solium at about $900 million.
Morgan Stanley will add Calgary-based Solium's 3,000 stock-plan clients and 1 million participants to its rival offering, which has 320 clients and 1.5 million participants. Solium's clients include such startups as Stripe Inc., Instacart Inc. and Shopify Inc., giving Morgan Stanley's investment bankers a chance to pitch those firms capital-raising ideas, while its advisers court tech workers as they start to accumulate wealth.
The large premium Morgan Stanley agreed to pay "might raise a brow, but we think this makes significant strategic sense," analysts at Evercore ISI said in a note, adding that the link-up "provides a real path towards the organic growth and next generation of clients that many investors have been questioning."
The Wall Street bank entered into a partnership with Solium in 2016 to administer equity-compensation plans for its corporate clients and their employees. The deal announced Monday won't affect Morgan Stanley's buyback plans, and is expected to be completed in the second quarter, according to the statement.
-- Bloomberg News
Toys R Us backers plan holiday revival
NEW YORK -- Toys R Us fans in the U.S. should see the brand re-emerge in some form by this Christmas season.
Richard Barry, a former Toys R Us executive and now chief executive of the new company called Tru Kids Brands, told The Associated Press he and his team are still working on the details, but they're exploring various options including freestanding stores and shops within existing stores. He says e-commerce will play a key role.
Toys R Us, buckling under competition from Amazon and several billions of dollars of debt, filed for Chapter 11 reorganization in September 2017 and then liquidated its businesses last year in the U.S. as well as several other regions including the United Kingdom.
In October, a group of investors won an auction for Toys R Us assets, believing they would do better by potentially reviving the toy chain, rather than selling it off for parts. Starting Jan. 20, Barry and several other former Toys R Us executives founded Tru Kids and are now managing the Toys R Us, Babies R Us and Geoffrey brands. Toys R Us generated $3 billion in global retail sales in 2018. Tru Kids estimates that 40 percent to 50 percent of Toys R Us market share is still up for grabs despite many retailers like Walmart and Target expanding their toy aisles.
-- The Associated Press
NYC mayor defends Amazon subsidies
ALBANY, N.Y. -- It was "mission critical" for New York City to land one of Amazon's second headquarters and the tens of thousands of jobs the company promises to create, Mayor Bill de Blasio said Monday, just days after a report said the company was having second thoughts because of opposition from some influential local politicians.
De Blasio, a Democrat, told lawmakers at a state budget hearing on local government funding that the type of high-paying jobs the Amazon deal could bring to Queens are the kind the city needs to expand its technology sector. Amazon has said it would bring at least 25,000 and as many as 40,000 jobs to the Long Island City neighborhood over 10 to 15 years.
The mayor and Democratic Gov. Andrew Cuomo last year brokered the deal with Amazon, offering some $2.8 billion in city and state tax incentives and subsidies.
But the Amazon deal is facing staunch opposition from some fellow Democrats in the New York City Council and the state Senate, who say too much was given away to one of the world's richest companies.
Sen. Michael Gianaris, the No. 2 lawmaker in the Democrat-controlled Senate, is one of the leading opponents of the Amazon deal. His opposition and that of others, including New York City Council Speaker Corey Johnson, has Amazon executives rethinking the New York location, according to a report last Friday by The Washington Post, which cited two unnamed people familiar with the company's thinking.
-- The Associated Press
Bankrupt utility will shake up board
SAN FRANCISCO -- Pacific Gas & Electric Corp., which filed for bankruptcy last month, announced a boardroom shakeup that would bring back at most half of the current board members.
No more than five of the utility owner's 10 current board members will stand for re-election at its upcoming shareholders meeting, according to a statement Monday. The company wants mostly independent directors, and the new board will have 11 of them, it said.
"We fully understand that PG&E must re-earn trust and credibility with its customers, regulators, the communities it serves and all of its stakeholders," according to the statement.
The utility owner has faced pressure from lawmakers, regulators and shareholders to revamp its management after 2017 and 2018 fires exposed it to liabilities that could exceed $30 billion and pushed the company into bankruptcy last month.
The next shareholders' meeting is scheduled for May 21.
-- Bloomberg News
Texas company recalls chicken items
HARLINGEN, Texas -- A Texas company is recalling nearly 50 tons of chicken products due to misbranding and the labels not indicating the items contain an allergen -- eggs.
The U.S. Department of Agriculture says the recall involves Vics Acquisition of Harlingen.
A company that Vics Acquisition co-packs for discovered the problem Friday. The USDA was notified Saturday. Officials have no reports of anyone getting sick.
The products, Happi Foodi Bloody Mary Inspired Chicken, Southeast Grocers Brand Marsala Chicken and Southeast Grocers Brand Mediterranean Herb Chicken items were produced Aug. 7 through Oct. 15.
The products include 1½ pound packages of frozen steam bag meals with various lot codes and the establishment number P-34622. Use-by dates range from last Thursday through April 15.
Happi Foodi items were shipped nationwide. Southeast Grocers Brand products went to retailers in Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina.
-- The Associated Press
Business on 02/12/2019