Page 24 - ARUBA TODAY

Friday 21 July 2017 BUSINESS
A24

Spice maker McCormick buys Reckitt unit for $4.2 billion

By DANICA KIRKA rival bidders to purchase number three brands, re- egy to re-focus on con- Kapoor, CEO of RB.
Associated Press the business that makes spectively. sumer health and hygiene Reckitt’s food business is
LONDON (AP) — U.S. spice French’s mustard and “RB Foods’ focus on creat- products after it bought headquartered in Chester,
maker McCormick & Com- Frank’s RedHot brands. The ing products with simple, U.S. baby formula maker New Jersey.
pany has bought Reckitt deal, disclosed on the Lon- high-quality ingredients Mead Johnson. The company employs
Benckiser’s food business don Stock Exchange on makes it a perfect match The company’s brands in- 450, including some 360 in
for $4.2 billion in cash, in a Wednesday, will create a for McCormick as we con- clude Nurofen, Woolite Springfield, Missouri.
deal it regards as a “per- combined group with an- tinue to capitalize on the and Clearasil. McCormick has said it
fect match” but that some nual sales of around $5 bil- growing consumer interest “This transaction marks an- wants to strip out around
investors think may be a bit lion. in healthy, flavorful eating,” other step towards trans- $50 million in cost “syner-
too pricey. French’s and Frank RedHot said Lawrence E. Kurzius, forming RB into a global gies” after the takeover,
The Sparks, Maryland- brands will become Mc- McCormick’s CEO. leader in consumer health the majority of which would
based company fought off Cormick’s number two and The deal is part of RB’s strat- and hygiene,” said Rakesh be achieved by 2020.q

US housing construction starts rebound solidly in June

make up for the decrease ages of labor and lots to
in existing homes being list- build on, which will boost
ed for sale. pricing.”
The June housing figures So far this year, builders
point to healthy demand have turned their attention
that new construction toward single-family hous-
alone has been unable es and away from rental
to satisfy. Fewer existing apartments. Starts of single-
homes are being listed for family houses have risen 7.9
sale, while purchase prices percent, while construction
for newly built homes have of multi-family buildings has
surged at pace more than slipped 4.2 percent.
six times wage growth. Housing starts jumped a
As a result, more Americans stunning 83.7 percent in the
are rushing to purchase Northeast and 22 percent
homes but are struggling to in the Midwest, growth that
do so because of a lack of is unlikely to be sustained.
supplies and higher costs. The government’s home
Builders also face higher construction report can be
costs for land and materi- volatile on a monthly basis.
als, putting a limit on just Sales edged up in the West
how much construction but declined in the South.
can occur. Building permits, an indica-
“Steady gains in construc- tor of future construction,
Builders work on the roof of a home under construction at a housing plan in Jackson Township,
Butler County, Pa. On Wednesday, July 19, 2017, the Commerce Department reported on U.S. tion are expected over were up 7.4 percent to 1.25
home construction in June. the next year, supported million. Construction firms
(AP Photo/Keith Srakocic) by still-strong fundamen- are confident that demand
tal demand for housing,” will continue, but they have
By JOSH BOAK east and Midwest. straight monthly declines said Jennifer Lee, a senior also begun to temper their
AP Economics Writer Housing starts climbed 8.3 and marked the strongest economist at BMO Capital expectations.
WASHINGTON (AP) — percent in June to a season- pace of building since Feb- Markets. The National Association of
Homebuilders ramped up ally adjusted annual rate of ruary. Home construction “But acting as a bit of a Home Builders/Wells Fargo
construction in June to the 1.22 million, the Commerce has risen 3.9 percent year- roadblock are problems builder sentiment index fell
fastest pace in four months, Department said Wednes- to-date, but that slight in- that the builders face: ris- to 64 in July, the lowest lev-
led by surges in the North- day. The gain ended three crease has been unable to ing lumber costs, and short- el since November. q

Trading helps Morgan Stanley’s profit beat forecasts

By KEN SWEET ed the same from Morgan ing revenue of $1.2 billion, ley is moving away from ever.
AP Business Writer Stanley. But while Morgan down just slightly from $1.3 relying on stock trading to “Our second-quarter re-
NEW YORK (AP) — Invest- Stanley did report a mod- billion a year earlier. The focusing on more stable sults demonstrated the
ment bank Morgan Stan- est decline in trading rev- division at Goldman Sachs businesses, like asset and resilience of our franchise
ley said its second-quarter enue, it was nowhere close that trades similar securities wealth management. in a subdued trading envi-
profit rose 11 percent from to those seen by its rivals. reported a drop of 40 per- Morgan’s better-than-ex- ronment,” James Gorman,
a year ago, and the bank’s Morgan Stanley said this cent. Bank of America had pected quarter was also chairman and CEO of Mor-
trading desks were able to week it earned $1.76 billion a decline of 14 percent reflected in its return-on- gan Stanley, said in a state-
outmaneuver its rivals in a in the three months that and JPMorgan was down equity ratio, a measure of ment.
quiet market. ended June 30, or 87 cents 19 percent. an investment bank’s prof- Morgan Stanley’s wealth
After the bank’s major per share, compared with Stock trading, a market itability, which improved to management division also
competitors — Goldman $1.58 billion, or 75 cents per that historically is Morgan 9.1 percent from 8.3 per- had a relatively strong
Sachs, JPMorgan Chase, share, in the same period Stanley’s strongest, had cent a year earlier. That’s quarter, reporting a profit
Citigroup and Bank of a year earlier. That hand- a modest increase in rev- still below the long-term of $1.1 billion compared
America — all reported ily beat analysts’ expecta- enue. goal of Morgan’s manage- with $859 million a year ear-
declines in trading during tions of 76 cents per share. The strong quarter in trad- ment for a return-on-equity lier. Assets under manage-
the period, many expect- The bank had bond trad- ing comes as Morgan Stan- of above 10 percent, how- ment also increased.q