Deal :Berkshire to Pay $4.5 Billion for Pritzkers' Marmon

Warren E. Buffett may be a choosy shopper, but when he sees a firm he likes, he moves fast.
After just two weeks of negotiations, Mr. Buffett, who has been looking for acquisitions on which to spend his company’s billions of dollars, snagged an industrial conglomerate in a deal announced Tuesday. The Pritzker family of Chicago will sell to Mr. Buffett’s firm, Berkshire Hathaway, a 60 percent stake in Marmon Holdings for $4.5 billion.
The deal would go a long way toward unwinding the business holdings of the Pritzkers, a process that started in 2001. For Mr. Buffett, the deal represents his largest acquisition outside the insurance industry and suggests that he is finally finding some deals he can get excited about.
Berkshire will acquire the remaining 40 percent of Marmon over the next five or six years at a price that will be based on the future earnings of the company. In 2006, Marmon posted revenue of $7 billion and profit of $1 billion from operations like wire and cable, railroad tank cars and water treatment systems.

Dec. 26 (Bloomberg) -- Billionaire Warren Buffett's Berkshire Hathaway Inc. will pay $4.5 billion for 60 percent of Marmon Holdings Inc., adding another family run company that prospered without shareholder demands for short-term profits.
Chicago's Pritzker family, which controls Global Hyatt Corp., built Marmon into a group with $7 billion in annual sales and 125 units including operations serving the railroad and energy industries. Operating income more than tripled from 2002 to 2007, Omaha, Nebraska-based Berkshire said in a statement yesterday.
Marmon has ``businesses that are fairly niche-oriented where they have dominant positions established over time,'' said Thomas Russo, who manages about $3.5 billion at Gardner Russo & Gardner in Lancaster, Pennsylvania and counts Berkshire as its largest holding. ``They have a history under the Pritzkers of being liberated from the quarterly earnings game.''
Buffett, 77, built Berkshire over four decades, buying out- of-favor stocks and manufacturers to transform a failing textile maker into a $210 billion holding company. His biggest investment last year was the $4 billion purchase of Iscar Metalworking Cos. from Israel's Wertheimer family.
Marmon is ``our kind of company,'' Buffett said in an interview with CNBC today. ``It's in some very basic businesses but good businesses.''
Berkshire, which had more than $45 billion in cash as of Sept. 30, is as prepared as it has ``ever been'' to buy a ``big business outright,'' Buffett told shareholders at an annual meeting in May. He's said he'd be willing to spend as much as $60 billion on the right company.
The Marmon acquisition is set to be completed in the first quarter of 2008, with Berkshire acquiring the remainder of the company by 2014 at a cost based on future earnings.
Trains, Cranes
Marmon employs 21,500 people, mostly in North America, the U.K., Europe and China, according to the company's Web site. Its businesses include a dozen companies that manufacture wire and cable products for energy and construction use.
The Chicago-based group also has a transportation-services operation that produces railroad cars and leases tank containers in China. Operating income was $794 million last year, according to the Web site.
The businesses ``are not prone to widespread technical obsolescence,'' Russo said. ``They would have a relationship with their suppliers and customers that give them an ongoing partnership.''
Berkshire had about 217,000 employees as of Dec. 31 in businesses ranging from auto insurer Geico Corp. and carpet manufacturer Shaw Industries to ice cream company International Dairy Queen Inc. and business-jet fleet operator NetJets Inc.
Largest Since 2005
The Marmon takeover is the largest announced by Buffett since 2005, when Berkshire's utility company agreed to buy PacifiCorp from Scottish Power Plc for $5.1 billion in cash and assume $4.3 billion in debt. Buffett has also been investing in railroads, disclosing in April that he purchased a $3 billion stake in Fort Worth, Texas-based Burlington Northern Santa Fe Corp., the second-largest railroad in the U.S. after Union Pacific Corp.
Buffett prefers buying companies outright rather than investing in stocks because ``that way he can control the reinvestment decisions,'' Russo said. ``He would have the appetite and the balance sheet to underwrite almost limitless investments through their operating entities.''
Marmon has an ``impressive record of growth and profitability,'' Buffett said in the statement. ``The decision to purchase and work out the details of this transaction was done without delay.''
Berkshire spokeswoman Jackie Wilson and Chief Financial Officer Marc Hamburg didn't return calls seeking comment. David Dees, a spokesman for Marmon, had no comment.
Pritzker Breakup
The Pritzker family has discussed breaking up its holdings since the 1999 death of Jay Pritzker, who began the hotel company in 1957 by buying the Hyatt House in Los Angeles. The family's investments range from a global credit-check company to a maker of artificial joints. Marmon was acquired in 1953 by Jay and his brother Robert, according to the statement.
``This transaction is being done in the context of the previously reported restructuring of our family business interests,'' Marmon Chairman Tom Pritzker said in the statement.
In August, the family said it would sell a minority stake in Global Hyatt to investors including Goldman Sachs Capital Partners for $1 billion. In 2006, the family agreed to sell snuff maker Conwood for $3.5 billion to Reynolds American Inc.
In January 2005, actress Liesel Pritzker and brother Matthew Pritzker, settled a $2 billion suit accusing Tom Pritzker and other relatives of cheating them out of their inheritance.
Inheritance Suit Settled
The siblings claimed their trust-fund assets were being transferred to accounts benefiting other relatives and the family foundation. Terms of the deal weren't disclosed.
Tom Pritzker was ranked by Forbes as the 117th wealthiest person in the U.S. with a net worth of $3 billion. Buffett was second with $52.4 billion, the magazine said.
Buffett will work with Tom Pritzker, Marmon Chief Executive Officer Frank Ptak and former CEO John Nichols over the next five to six years ``in continuing to build Marmon,'' Berkshire said in the statement.
Berkshire, which traded at $2,950 on Dec. 31, 1987, is poised to post its 17th annual gain in 20 years. It climbed $3,980 Dec. 24 to $137,980 in New York Stock Exchange composite trading. The stock is up 25 percent in 2007, outpacing the 5.5 percent gain for the Standard & Poor's 500 Index.
The company's largest purchase was the acquisition of General Re, the largest U.S. reinsurance company. The stock deal was valued at $16 billion when it was completed in 1998.
`Simple' Businesses
Buffett's investment criteria include companies with ``good returns on equity,'' little or no debt, ``simple'' businesses that he can understand, and consistent earnings, he said in Berkshire's latest annual report. Buffett doesn't participate in auctions for companies and can tell prospective sellers within five minutes of an offer if he is interested in completing a deal, he said in the report on March 1.
The Marmon acquisition ``was done just the way Jay would have liked,'' Buffett said in the statement. ``No consultants or studies.''

Merrill raising up to $6.2 billion:

Investment Contract :Merrill Lynch & Co. will raise up to $6.2 billion to be invested by Singapore-based investment firm Temasek Holdings Pte. Ltd. and U.S.-based Davis Selected Advisers L.P., the investment bank said Monday.
Along with the private placement of common stock, Merrill (MER:Merrill Lynch & Co., IncNews, chart, profile, more Last: 53.90-1.64-2.95%
1:00pm 12/24/2007
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MER 53.90, -1.64, -2.9%) said it's selling its middle-market commercial finance business for an undisclosed amount. New York-based Merrill said the placement of newly issued stock is expected to close by mid-January. Chief Executive John Thain, who assumed Merrill's top position in November, said the private placement will bolster Merrill's capital position. Thain came to Merrill from NYSE Euronext (NYX:NYXNews, chart, profile, moreLast:
Delayed quote dataAdd to portfolioAnalyst Create alertInsiderDiscussFinancials Sponsored by:NYX, , ) more than one month ago, amid a difficult period during which Merrill sustained significant write-downs related to troubles in the U.S. housing market. The private placement also creates a strategic partnership with Temasek, Merrill said in a statement, describing Temasek as having "sizable investments across Asia, particularly in Singapore, China and India." Temasek will invest $4.4 billion in Merrill common stock, with the option to buy an additional $600 million in stock by March 2008. Its ownership position in Merrill won't exceed 10%, Merrill said. Davis, meanwhile, will make a "long-term investment" of $1.2 billion, Merrill said. Neither Temasek nor Davis will have any "role in the governance" of Merrill, the firm said. Meanwhile, Fitch Ratings maintained a negative outlook on Merrill following news of the investment, saying in a statement that it believes "there is a high probability that additional losses will be recognized in fourth-quarter 2007 fiscal year which collectively may result in [the firm] posting a loss for its 2007 fiscal year." Fitch had lowered Merrill's long-term issuer default rating in October. Following an initial rise early in Monday's abbreviated trading session, Merrill shares closed nearly 3% lower, ending at $53.90. Also Monday, Merrill said it is selling Merrill Lynch Capital, the firm's middle-market commercial finance business, to GE Capital (GE:GENews, chart, profile, moreLast:
Delayed quote dataAdd to portfolioAnalyst Create alertInsiderDiscussFinancials Sponsored by:GE, , ) . Financial terms were not disclosed. Merrill's commercial real-estate finance unit is not part of the unit being sold, the firm said. Fox-Pitt Kelton said in a note to clients that the sale should "free about $1.3 billion [in] capital for Merrill. Thus, the total capital 'raise' is $7.5 billion." Fox-Pitt Kelton had previously estimated that Merrill's write-downs related to subprime and other troubled mortgage markets amounted to $8.6 billion. Merrill's sale of Merrill Lynch Capital "continues to signal that problems are significant, but that [management] is taking steps to get beyond it," the firm told clients

Sony Forks Over Chip Production To Toshiba :can do a better job of supplying the brains for the PlayStation 3.

Sony and Toshiba are collabrating for chip development :

Sony announced on Thursday a plan to sell its loss-making multimedia microprocessor operations to Toshiba for an undisclosed amount, hoping that its trusted joint venture partner can do a better job of supplying the brains for the PlayStation 3.

Following a month of leaks to various media outlets by unnamed sources, the world's second-largest consumer electronics company made an announcement late on Thursday that it will unload production lines for its Cell processor in a joint venture arrangement for a reported amount of about 100 billion yen ($856.38 million) to Toshiba.

The sale, drawn up in preliminary form as a nonbinding memorandum of understanding, is the latest swing of the ax by Sony Chief Executive Howard Stringer, who has cut the workforce and closed factories to boost profitability. In February he promised to cut back on development costs for the expensive, loss-making chips and to consider outsourcing production to outside partners.

Toshiba appears to be the best available buyer: Along with IBM (nyse: IBM - news - people ), Toshiba helped Sony develop the Cell, which bundles multimedia game features onto a single chip using 65-nanometer technology. Cell is produced in a plant in Nagasaki, in southwestern Japan; costly investment would be needed to prepare it to produce chips using next-generation 45-nanometer technology.

In addition to the sale of the Cell line, Toshiba is also taking over the manufacturing equipment for a line of image-processing chips also used in the PlayStation 3. Both sides were mum on how much the sale was worth but Nikkei Business Daily reported before the announcement that the sale price was about 30 billion yen ($256.92 million).

In a joint announcement, the two companies said Sony would transfer to Toshiba its advanced 300-millimeter wafer line fabrication facilities installed in a plant operated by its subsidiary, Sony Semiconductor Kyushu Corp., by the end of March 2008. The facilities house the Nagasaki Technology Center, responsible for developing the Cell line.

While the ownership of the asset would go to Toshiba, Sony and its gaming unit, Sony Computer Entertainment, would jointly participate in the production process as a minority shareholder of 40% in a new joint venture to be set up in April with Toshiba, which would take the remaining 60%.

Sony (nyse: SNE - news - people ) shares swooned after initial press rumors of the sale a month ago, but on Thursday afternoon, they were up 30 yen, or 0.55%, at 5,430 yen ($46.57).

The sale allows Sony to pass on the heavy cost of microprocessor development to Toshiba, Japan's largest microchip maker. It could possibly lower Sony's procurement costs for Cell chips if Toshiba can reap production efficiencies from commercializing the chips in a broader range of applications. Sony will also be able to invest the proceeds of the sale to bolster its world-leading position in image-processing chips for its digital cameras and cell phones.

For Toshiba (other-otc: TOSBF - news - people ), buying the Cell line would give it a huge upgrade in the system chip business, where it is lagging far behind Intel (nasdaq: INTC - news - people ) and Samsung (other-otc: SSNLF - news - people ), with the anchor of having Sony as a reliable buyer.

Both companies said they would jointly advance the Cell chips to the next stage of technology: Toshiba was reported by Nikkei Business Daily as intending to roll out a 45-nanometer version of the Cell in two years and employinh the cutting-edge chips in personal computers and flat-panel televisions.

The market has been concerned about Sony's growth prospects over the longer term beyond its recent obsession with asset sales and cost cutting. The sale of Cell follows after it sold part of Sony Financial last week, bringing the unit public in a 320 billion yen ($2.74 billion) share sale. (See: " Sony Cashes In On Financial Unit")

While it is planning to sink more money into research and development to reclaim technical leadership, exciting new growth areas seem far off, and it will now have to rely on Toshiba, a competitor on the consumer electronics front, for future generations of microprocessors for its games consoles.

Technorati : chip ps3 +

Aerotropolis: A city by itself

The first phase of the modernisation of Delhi International Airport by the GMR-led consortium, which will be completed by 2010 will see an investment of US$ 1.5 billion in commercial real estate development transforming Delhi airport into an airport city - an aerotropolis

According to the land concession agreement for the Delhi airport, of the 5,000-acres of land belonging to the airport only five per cent, or 250 acres can be used for commercial purposes. This will see high-density development of hotels, business centres, retail spaces, convention and exhibition centres, golf courses and entertainment centres. Says Mridul Upreti, head, Capital Markets, Jones Lang LaSalle Meghraj, "An aerotropolis, because of its high density and high quality development, strategic location and good connectivity would soon outdo even Connaught Place in economic activity and commercial rentals."

Ever since Dr John D Kasarda, director of the Kenan Institute of Private Enterprise, USA, first introduced the concept of an aerotropolis, the span of an airport has gone up exponentially. In the new model, airports, besides their core infrastructure and services, have created significant non-aeronautical commercial facilities, services and revenue streams. Consequently, they are extending their formal reach and impact with development along airport arteries up to 20 kms outwards.

In fact, Hong Kong International Airport already has a mini-city on a nearby island for its 45,000 workers, and soon the SkyCity, a complex of office towers, convention centres, and hotels is also being developed. China is spending US$ 12 billion for the Beijing Capital Airport City that will accommodate four lakh people. Dubai is also looking at developing the largest aerotropolis, Dubai World Central, a US$ 33 billion airport city capable of supporting a permanent population of 7.5 lakh.

But can such a development take place in India? According to Sanjay Dutt, deputy MD, Cushman and Wakefield, whenever there is large scale economic activity, the area around it becomes vibrant. Airports are the hub of very enormous economic activity including cargo, car rentals, hotels, retail, etc. Says Dutt, "Prices shoot up because people start calculating returns on property near the airport. In a developing economy like India, the value is expected to go up significantly. It can even go up by 100 per cent".

However, DTZ director Vivek Dahiya feels that as the cantonment area on three sides and Palam Village on the fourth surround Delhi airport, no major development can take place outside the airport area. "Moreover, the DDA master plan does not allow for commercial centres like hotels to come up near the airport. Only if DDA revisits the policy and allows commercial development can the real estate prices around the airport also go up."

Interestingly, many airports are now getting a bigger of their revenues from non-aeronautical sources than from aeronautical sources (landing fees, gate leases, passenger service charges). Globally, 70 per cent of an airport revenue is generated through non-aeronautical sources, while in India it is still a lowly 30 per cent.

Due to the significantly higher incomes of airline passengers (typically three to five times higher than national averages) and the huge volumes of passengers flowing through the terminals , it should not be surprising that terminal retail sales per square metre average three to four times greater than shopping malls and downtown shops. As a result, terminal commercial lease rates tend to be the highest in the metropolitan area.

Commenting on the high commercial rentals of airports in India, Dutt says, "The passenger is bound to shop, eat, etc, and has certain needs. Therefore, outlets at the airports design and put retail items accordingly. Moreover, the quality of experience is assured. Secondly, in India, the quality of retail space is very limited and so is organised retail. With lots of airports getting privatised and developed, we will witness a rush to occupy retail space."

The new US$ 4 billion Suvarnabhumi airport in Thailand, will see more than 100 million passengers a year passing through the airport, about as many as JFK, LaGuardia, and Newark airports combined. Within 30 years, a city of 3.3 million citizens - larger than Chicago now - will have emerged around Suvarnabhumi.

Delhi International Airport, has already invited expression of interest from Indian and international real estate investors to develop a complete range of hospitality services to build various categories of hotels and related facilities at the Delhi airport. But no other airport in India is looking at developing similar facilities. According to analysts, commercial development near the Mumbai airport would affect real estate prices. "Mumbai airport is in the heart of the city, unlike Delhi. If the slums get cleared, the real estate value of the area surrounding the airport will substantially increase," Dahiya said.

Amsterdam Schiphol, through its Schiphol Real Estate Group, has been working for over a decade on the cityside commercial development. Nearly 58,000 people are employed at Schiphol, which integrates multi-modal transportation, regional corporate headquarters, retail shopping, logistics and exhibition space to form a major economic growth pole for the Dutch economy. Others, though not quite on the scale of Amsterdam Schiphol or Seoul's Incheon, have given commercial development a high priority in their master planning (Brisbane, Vienna, Calgary, Zurich and Stockholm-Arlanda). Many of these have implemented the airport city concept in their strategic development.

There are different requirements that can stipulate the developing of an aerotropolis. For companies engaged in IT services it is very important to have good air connectivity. According to a report, high-tech professionals travel by air at least 60 per cent more frequently than others. Such firms are increasingly looking at setting up their offices near airports. The Washington-Dulles Airport access corridor in Northern Virginia and the expressways leading to Chicago's O'Hare International Airport are good examples.

When commercial centres start coming up around an airport, it also leads to a high rate of employment generation faster than other suburbs situated at similar distances from other city centres, which further leads to development of an aerotropolis.

Technorati : Aerotropolis:

Microsoft developing (OCS)office communication server 2007

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Microsoft Corp. is looking for develop their office communication server

While most enterprise IT shops today still don't know what Unified Communications really is, information systems leaders at Global Crossing in 2005 had a pretty good idea of what it was and how the company could benefit from it.

ADVERTISEMENT On Oct. 16, Global Crossing IS leaders will participate in the launch of Microsoft's UC platform and demonstrate how their UC implementation via Office Communications Server 2007 and Exchange Server 2007 helped improve worker productivity by streamlining exception handling.

Microsoft Corp. is expanding its work with enterprise telephony vendors to make its Office Communication Server (OCS) 2007 work more closely with office phone systems.

On Tuesday, at the launch of OCS, the company plans to unveil a formal program to certify interoperability between IP (Internet Protocol) phone systems and OCS. As part of that, Microsoft will discuss a specification to let enterprises migrate one building at a time to its software-based unified communications system and still have calls go across the organization as if on the same PBX (private branch exchange). Two models of Cisco Systems Inc.'s popular ISR (Integrated Services Router) branch-office platform will be among the products certified for this type of interoperability, according to Zig Serafin, general manager of Microsoft's Unified Communications group.

Microsoft's initiative, called the OCS 2007 Open Interoperability Program, will formalize work that has already been going on with some third parties. As that work has expanded, it's reached a point where it needs to be more organized, Serafin said. The idea is to let customers know what will work with OCS, and Microsoft will provide a table on its Web site where potential customers can check the certifications of third-party products.

Although promoted as an effort to coexist with the IP (Internet Protocol) phone systems now established or taking root in enterprises, the program also will make it easier for customers to migrate away from dedicated communications systems and phones themselves, the company acknowledges. Voice call control is new to Microsoft's unified communications system with OCS 2007, but the software giant envisions a day when separate platforms such as Cisco's CallManager won't be needed, industry analysts say.

Cisco, Avaya Inc. and other vendors have already moved the voice call-control functions of traditional circuit-switched PBXes (private branch exchanges) into server software, but they sell that software along with IP handsets and other gear. Microsoft intends OCS, together with Office Communicator 2007 client software or special OCS phones made by Polycom Inc. and LG Electronics Inc., to ultimately replace those dedicated systems.

There are three methods of interoperability that will be certified under the program.

- SIP CSTA (Computer Supported Telephony Applications) is based on a standard by the European Communications Management Association (ECMA). It lets users control calls through the Office Communicator client on the PC, though in most cases still using the handset and PBX.

- OCS Coexistence lets the user pick up a call on either the existing handset or a client that uses OCS, namely Office Communicator or a special OCS phone.

- Direct SIP (Session Initiation Protocol) interoperability allows for some parts of an enterprise to use traditional or IP PBXes and others to use OCS, with transparent connections between them using gateways, according to Microsoft. SIP is the emerging standard protocol for exchanging information on voice, videoconferencing and other communications sessions.

Microsoft has already certified gateway products from five vendors for Direct SIP interoperability, Serafin said. Among them are Cisco's Integrated Services Router 2851 and 3845. In fact, all ISRs with voice capability can interoperate with OCS, according to Mike Wood, [cq] director of product marketing in Cisco's access routing group. Gateways from Dialogic Inc. also have already been certified.

As a newcomer to telephony, Microsoft will take time to displace many standalone telephony systems, so interoperability will be critical, analysts said.

Most enterprises that adopt OCS still have phones connected to PBXes and will dial through the PBX, said Brent Kelly, [cq] a senior analyst at Wainhouse Research LLC. To start, most OCS users will keep their PBXes in place and take advantage of CSTA to gain the click-to-call benefits of OCS, he said.

"Right now, OCS doesn't have a voice model that's good enough for the enterprise," Kelly said.

However, there are a number of barriers to interoperability, too, said IDC analyst Nora Freedman. While Direct SIP interoperability is a good idea, it will take a long time to really work because SIP is so new, she believes.

"We're still battling proprietary SIP extensions from all the notable vendors," Freedman said.

Meanwhile, CSTA could be a distraction for enterprises trying to make the transition to unified communications because it brings yet another standard into the picture, she said. And for now, it's hard for early adopters to get theses kinds of systems put together, she added.

"Now we have a wealth of product but a drought of system-integrator experience in this," Freedman said. Resellers are working feverishly to build up their expertise, she said.

Microsoft's plan for telephony is bold, looking to eventually eliminate OCS as a separate product and make it, and telephony itself, just a set of features in applications, believes Zeus Kerravala [cq] of Yankee Group Inc. But for the time being, the job at hand is making OCS work with existing phones, he said.

"The first phase is just to get it out there,"

Technorati : communication server

The Geothermal Energy Industry Connects With the Financial Community for a Major Deal Making Event

Meet leading project developers, investors, lenders, power purchasers, technology experts and other active market players looking to craft deals and discover:

• How to benefit from the increasing flow of available capital


• Who will be making deals


• What terms are available


• What opportunities exist for partners & investors

About The Summit:

Geothermal is poised to meet the rapidly growing demand for renewable, zero-carbon power. Expansion opportunities across the US have enormous potential for geothermal energy growth. The opportunities for geothermal have never been more promising and the financial community sees it as the next big renewable play.

The Geothermal Finance & Investment Summit will bring together leading project developers, investors, lenders, EPC contractors, and other players to share their perspectives on the market for geothermal finance and investment. You will not only hear from this group about the latest developments in the geothermal finance and investment markets, but the Summit will also provide an outstanding opportunity to meet and network with active market players and to accurately gauge the current pulse of the industry.

The Summit is designed to provide the latest intelligence on the current market environment for putting together geothermal deals. The players in the market will discuss what they are looking for when they get involved in deals, what future opportunities exist for partners and investors, and how to successfully get deals done in 2008 and beyond. You will hear:

• Developers offer their perspective on the current market


• Investors discuss criteria used in evaluating geothermal investments


• Lenders outline terms and structures for debt-financing


• Technology companies and EPC contractors provide their perspective on physical development of projects


• Utilities discuss purchasing geothermal baseload to meet RPS requirements

Pre-Summit Workshop:

Financing Geothermal Projects

An in-depth full-day workshop, Financing Geothermal Projects, precedes the Summit. The workshop will provide an in-depth tutorial by top lawyers and consultants on how to best structure your project and allocate risk for maximum project success.

To register
or obtain more information about this unique event, please visit the event website at http://www.infocastinc.com/geotherm.html, or call (818) 888-4444.

Technorati : Geothermal Energy Industry Connects

International Privacy Standard proposed by Google

This seems to me like it will be good for global businesses as a universal standard will allow a more streamlined approach to how to handle individual data.The world's largest Internet search company wants to create new ways to help keep Internet users safe.

Search giant Google Inc. will propose on Friday that governments and technology companies create a transnational privacy policy to address growing concerns over how personal data is handled across the Internet.

Google's global privacy counsel, Peter Fleischer, will make the proposal at a United Nations Educational, Scientific and Cultural Organization meeting in Strasbourg, France, dealing with the intersection of technology with human rights and ethics.

Fleischer's 30-minute presentation will advocate that regulators, international organizations and private companies increase dialog on privacy issues with a goal to create a unified standard.

Google envisions the policy to be a product of self-regulation by companies, improved laws and possible new ones, according to a Google spokesman based in London.

"We don't want to be prescriptive about who does that and what those standards are because it should be a collaborative effort," the spokesman said.

Other organizations have already made progress on privacy standards, he said. For example, Asia-Pacific Economic Cooperation (APEC) created a nine-point Privacy Framework designed to aid countries without existing policies.

Google today proposed that governments and technology companies need to work together to create an international method that details how the personal information of users should be handled on the Internet. Google's Peter Fleischer, chief privacy officer, challenged members of the United Nations to help make sure user privacy remains safe.

"People look to us to show some leadership and be constructive," Fleischer said before speaking before the United Nations Educational Scientific and Cultural Organization. "By supporting global privacy standards, there will be a debate and part of that debate will be what are motives our."

A large problem is that privacy standards can vary greatly among countries, something that can cause issues for companies that operate in many countries. Along with not having a federal privacy law to protect consumers, laws in the United States often vary state-by-state: another roadblock that will likely need to be fixed.

Another problem facing companies such as Google is that many of the laws are extremely out of date when compared to how the Internet has progressed. An Internet law created by lawmakers just 10 years ago cannot fairly be used today.

"Privacy laws have not kept up with the reality of the internet and technology, where we have vast amounts of information and every time a credit card is used online, the data on it can move across six or seven countries in a matter of minutes," Fleischer said.

Assuming that data is passed through a small handful of information in a short amount of time, companies need to create a safeguard to make sure the data remains safe -- especially since a lot of nations have minimal data protection laws, Fleischer added.

The Asia-Pacific Economic Cooperation (APEC) recently created a privacy framework that organizers hope will help nations modify existing laws that deal with user privacy and protection. However, much work must be done due to legal gray areas and loose translation of the privacy framework - for example, general principles are highlighted, but nations are responsible for their own enforcement.

Google already has spoken with Yahoo! and Microsoft over privacy standards, and now plans to speak with regulators from a number of different nations.

At a time when Google is worried about government regulation and laws over privacy, critics of the search engine company claim its recent acquisition of DoubleClick Inc are concerned Google now has the ability to store too much user data. Due to rising pressure from European officials, Google agreed to hold cookies up to two years only - the company originally scheduled cookies to be deleted in 2038.

Some other privacy standard

The P3P standard

The P3P specification has a double nature. On the one hand it is standardizing technical issues to facilitate the exchange of privacy meta information. On the other hand it requires the website to provide certain information necessary to enable the user of do-it-yourself privacy protection (e.g. the entity processing the data, types of collected data, purpose of collection and the type of processing). Requiring this information P3P sets a (minimum) privacy standard.

By offering a P3P policy, websites are giving a binding promise to their users that they will follow the P3P standard as a whole. It is part of the promise to provide the information required by the P3P specification truly and comprehensively. It also includes a careful interpretation according to the P3P specification of what personal identifiable data actually is. All things considered using P3P means agreeing on a legally binding (minimum) privacy standard between the parties.

Legal Privacy Standard

Some countries have their own data protection laws requiring i.e. special user information or allowing data use for special purposes only. These legal privacy standards are especially within European Union member states higher than the P3P specification's requirements (e.g. which information has to be provided in the P3P policy).

The relations between the P3P privacy standard, other legal privacy standards and the parties involved are illustrated in the following chart.

Technorati : International Privacy Standard

Hazy Logic spinned off

PB : Md. Moshiur Rahman sponsored by www.careerbd.net and www.24hournews.blogspot.com

The Marlboro Man is surrendering his passport.

After spinning off Kraft Foods, tobacco giant Altria Group is set to hive off its international arm, Philip Morris International. It seems like an odd decision. The risk of crippling U.S. lawsuits -- a major rationale for separating the businesses in the first place -- has mostly subsided. And a spinoff might not unlock much shareholder value anyway.

Getting rid of Kraft was a no-brainer. Making Oreos and cigarettes under the same roof never made much sense. But PMI is a different story. Synergies with the domestic cigarette business would vanish by separating them. And strategically, PMI's growth balances the domestic arm's weaknesses.

Tobacco consumption in the U.S. is shrinking. Overseas, the tobacco trade is booming, particularly in emerging markets, and accounts for about two-thirds of Altria's overall profit. There's an argument for milking the mature cash flows of the domestic business to feed faster-growing markets.

That's especially true when it's not clear what financial engineering can accomplish. Assume that Altria's international business fetches an enterprise value comparable to British American Tobacco's, at 12 times earnings before interest, tax, depreciation and amortization. For Altria's U.S. arm, assign a multiple of six times -- a premium to Carolina Group, the tobacco unit of Loews Corp. The result is a blended multiple of about 10 times -- in line with Altria's $146 billion market value.

Sure, PMI now can offer its managers incentives with a currency all their own. And removing any lingering association with the U.S. might make it easier for PMI to woo potential acquisition targets overseas. Yet these are fuzzy benefits. Without a clear path for creating value, Altria's board may regret letting the Marlboro Man's more-worldly cousin ride off into the sunset.

Pox on Both Housing Markets

A year ago, Britain probably looked more vulnerable than the U.S. to problems in the housing economy. Confidence, the expectation that prices would only go up, was equally extravagant in both countries. Economic news also was equally supportive, with solid growth and low unemployment.

But house prices looked bubblier in Britain. In the decade up to 2006, the gap between growth in house prices and in nominal per-capita gross domestic product was 69 percentage points in the United Kingdom. In the U.S., it was 20 percentage points. Also, the recent increase in overnight interest rates should have been more painful in the U.K., since almost all British mortgages are variable-rate, in which the interest rate changes along with short-term rates, although sometimes after a delay. Most U.S. mortgages have fixed 30-year rates.

Yet it was the U.S. housing market that got into trouble -- the average home price is down 3% in a year, and unsold new houses are piling up. Repossessions are up in the U.K., but so is the average price -- 12% from a year ago, according to Halifax, a U.K. bank.

Two trans-Atlantic differences explain some of the U.K.'s resilience. Construction of new housing is a big and highly cyclical industry in America and a midsize and stable affair in the U.K. The U.K. doesn't have to deal with the price-depressing effect of homes dumped on the market by cash-strapped builders.

Second, lenders in the U.K. have to keep a higher proportion of their loans on their own balance sheets -- something like 80%, against 20% in the U.S. That has probably kept British lenders from going to extremes in subprime lending.

Still, investors in U.K real estate shouldn't assume the housing ladder will reach to the sky. Two million borrowers face higher interest payments in the next year, when their two-year teaser rates expire. If enough of them are forced to sell, or if unemployment picks up, the U.K. could start to look a bit more American.

From More source

(MSN)Altria to split up Philip Morris.

Altria Group on Wednesday said it would split the international and domestic operations of Philip Morris, the world's biggest cigarette maker, into separate public companies in a long-anticipated move.

The fast-growing international unit, Philip Morris International, will be spun off to shareholders, severing it from Philip Morris USA, which is suffering from falling US cigarette consumption. The spin-off is set for next year after a unanimous board vote. Timing will be given on January 30.

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Louis Camilleri, Altria chief executive, will become chief executive of PMI, whose operations are based in Lausanne, Switzerland, but with a small headquarters office retained in New York. Altria will in effect become PMUSA, led by Michael Szymanczyk, and it will retain its 28.6 per cent stake in the brewer SABMiller.

The move will complete the break-up of the Altria conglomerate, highlighted by the closure of the New York headquarters, cutting about 400 parent company jobs with an estimated $250m in cost savings.

Altria has restructured, including a spin-off in March of Kraft, its US food unit, to boost value for shareholders as the US tobacco litigation threat receded.

The last step marking a milestone in the global tobacco industry was to restructure Philip Morris, which makes Marlboro, one of the world's most recognisable brands, and PMUSA's and PMI's increasingly different business agendas. Mr Camilleri said: "I am convinced that this transaction will enhance growth at both Altria and Philip Morris International."

A standalone PMI would be a fast-growing global contender. It has a 15.4 per cent share of the international cigarette market, but only 5 per cent of its profits come from emerging markets, which make up 60 per cent of international cigarette consumption. Its balance sheet would be strong and its stock would be robust currency to participate in rapid industry consolidation.

PMI, which accounts for almost three-quarters of the cigarette makers' total revenue, has made recent acquisitions in Indonesia and Pakistan and eyed fast-growing Asian and eastern European cigarette markets.

Bonnie Herzog, analyst at Citigroup, said: "It's at this point that we expect the beast to be unleashed...and shareholders will be rewarded."

Separating PMI and PMUSA is likely to cheer Wall Street as it will free both groups to become more efficient. Altria shares were up by just over 1 per cent at $69.80 at the close.

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