CenturyTel Inc. Monday said it will buy Embarq Corp., a larger fellow telephone company, for stock initially valued at $5.8 billion. Analysts said the move was a harbinger of further deals for rural phone companies, which are suffering from line losses as consumers choose phone service from wireless or cable companies. The combined company will have about 8 million lines spanning 33 states, mainly in rural areas. Even though CenturyTel is the acquirer and its management will dominate the combined company, Embarq shareholders will own two-thirds of it. CenturyTel would also assume $5.8 billion of Embarq's debt in the deal, the companies said. The headquarters for the combined company will be in Monroe, La., where CenturyTel is based, but there will be a "significant presence" at Embarq's current headquarters in Overland Park, Kan., the companies said.
Fed sets rates for buying commercial paper The Federal Reserve said Monday it is asking a rate of 1.88 percent to buy unsecured commercial paper, plus a 1 percent surcharge, and a rate of 3.88 percent for asset-backed commercial paper. The Fed said earlier this month it would start buying commercial paper to bolster the market. Commercial paper is the short-term debt that companies sell for their short-term financing needs. Sometimes it is unsecured; other times, it is backed by assets such as mortgages.
Microsoft to offer information storage space After more than two years as Microsoft's low-profile chief software architect, Ray Ozzie has something to say: Windows Azure. The man who replaced Bill Gates as the company's top technical thinker told a Los Angeles conference for software developers Monday that Microsoft Corp. will compete with Amazon.com, IBM and other rivals in selling information storage space and computing power "in the cloud," distributed across massive data centers worldwide. The system, Windows Azure, will let companies and hobbyists build Web-based programs without having to invest in their own server farms.
GM to give two factories a week off General Motors Corp. will temporarily close two factories for one week each to keep inventory in line with lower demand, it said Monday. The Detroit-Hamtramck assembly plant, which makes the Buick Lucerne and Cadillac DTS sedans, will be idled for one week starting Nov. 24. A factory in Bowling Green, Ky., that makes Chevrolet Corvettes and the Cadillac XLR sports cars will be idled the week of Dec. 1.
E.U. predicts growth of 0.4% or less next year European business leaders issued a bleak outlook Monday, predicting economic growth in the European Union will slow to 0.4 percent in 2009 -- and to only half that in its 15 euro-zone nations. BusinessEurope, which represents 20 million small, medium and large companies across Europe, urged the European Central Bank to be ready to make "further interest rate cuts" to ease the pain of an accelerating economic slowdown.
