Stocks in the news: General Motors, Prudential Financial, Elan
General Motors Corp. (GM) filed for Chapter 11 bankruptcy protection Monday morning. With the U.S. government now the majority owner with a 60 percent stake, the Canadian government owning 12.5 percent and the UAW 17.5 percent, GM will undergo severe restructuring. GM's bankruptcy filing is the fourth-largest in U.S. history and the largest for an industrial company. GM has $172.81 billion in debt and $82.29 billion in assets.
Ford Motor Co. (F) is now officially the last one standing off the Big Three Detroit automakers. Ford is preparing an effort to gain market share with plans to increase production of cars and trucks in the third quarter by about 10 percent from a year ago level. It will be Ford's first significant production increase in almost two years. Shares 3.8 percent ahead of the bell.
[Update 9:35 am:Cisco (CSCO) will replace General Motors (GM) in the Dow Jones Industrial Averages; Travelers (TRV) will replace Citigroup (C).]
Prudential Financial (PRU) said it will offer $1.25 billion of its common stock, after turning down Federal aid from the U.S. Treasury's Capital Purchase Program. It intends to use the net proceeds for general corporate purposes, which may include adding capital to its insurance and other subsidiaries, or repaying debt.
Kohlberg Kravis Roberts & Co., which operates KKR Financial Holdings (KFN), a specialty-finance company, swung to a pretax loss of $1.2 billion in 2008 as the economic downturn hurt the private-equity firm's investments and as leveraged buyouts became harder to finance. KKR is considering a deal to take itself public by buying its Amsterdam-listed affiliate KKR Private Equity Investors. KFN shares jumped 8 percent before the bell.
AstraZeneca (AZN) and Merck & Co (MRK) said that they will collaborate to research a novel combination anticancer regimen composed of two investigational compounds from AstraZeneca, which according to trials could enhance their anticancer properties.
Elan Corp. (ELN) is said to be in advanced talks to sell a minority stake to Bristol-Myers Squibb (BMY) according to Reuters sources. Elan is also in talks with a second suitor, but the status of those discussions was unclear. This could be the first move in a multi-step transaction to sell Elan outright. ELN shares soared over 16 percent ahead of the bell.
SunTrust (STI) said on Monday that it is selling $1.4 billion worth of its common stocks and starting a $1 billion buyback of preferred shares and hybrid securities. The company said the fund raises would fulfill its requirements under the stress test.
Goldman Sachs Group Inc. (GS) is raising as much as $1.92 billion selling shares in Industrial & Commercial Bank of China Ltd. after the stock jumped 29 percent in the past two months. Goldman is selling almost the entire stake it's free to divest under a revised lockup agreement with ICBC.
Morgan Stanley (MS) and Citigroup (C) said Monday that they have closed their previously announced wealth management joint venture ahead of schedule.
Bank of America (BAC) -- O. Temple Sloan resigned from the board after 13 years as a director.
Yahoo Inc. (YHOO) was upgraded at Barclays to Overweight from Eequal-Weight, with the analyst saying the company is well positioned to benefit from a rebound in branded advertising spending, despite the current pricing pressures. Shares gained 2.4 percent before the bell.
Playboy Enterprises Inc. (PLA) is likely to offer its vacant CEO post to Scott Flanders, president and chief executive of Freedom Communications Inc, according to the Wall Street Journal. Shares dropped 20 percent in after-hours trading Friday.