Detroit/Washington: Chrysler LLC filed for bankruptcy on Thursday and announced an industry-changing deal with Fiat, after being pummeled by sliding auto sales and unable to reach agreement on restructuring its debt.

Despite weeks of intense negotiations, Chrysler failed to gain full support from its lenders to avoid the first-ever bankruptcy filing by a major US automaker. The move was hailed by President Barack Obama as a critical step in saving 30,000 jobs at Chrysler, majority-owned by Cerberus Capital Group, and hundreds of thousands more jobs at affiliated suppliers and dealers.

At the same time, Chrysler entered an expected alliance with Fiat SpA, in which the Italian carmaker was given an initial stake of 20 percent. The deal will allow Fiat to own up to 35 percent as it makes investments in US operations and small-car technology for Chrysler.

Over time, Fiat could eventually own 51 percent after Chrysler has repaid its loans to the US Treasury. Chrysler has struggled in recent years to compete, hurt by its near total reliance on the US market, poor quality and a truck and SUV-dominated vehicle line-up with the lowest combined fuel economy of any major automaker.

Founded in 1925 by Walter P Chrysler, three years later the company laid the cornerstone for the Chrysler Building, briefly the world’s tallest building and still a landmark on the Manhattan skyline.

The Chapter 11 filing, in US Bankruptcy Court in Manhattan, has implications for the entire industry–including Chrysler’s rivals and suppliers. As part of the filing, the US government will provide up to $3.5 billion in debtor-in-possession (DIP) financing and up to $4.5 billion in exit financing.

Obama said he hopes the entire process will take only 30 to 60 days. Some of Chrysler’s 3,600 US dealers are expected to close, and Chrysler Financial will stop providing loans for new cars and trucks. Instead, General Motors Corp’s financing arm, GMAC, will provide loans to Chrysler dealers and customers. The legal proceedings will be overseen by Judge Arthur Gonzalez, the same jurist who oversaw the Enron and WorldCom bankruptcies.

In addition to Fiat’s ownership stake, U.S. officials expect Chrysler to be 55 percent owned by the United Auto Workers’ healthcare trust fund while the U.S. and Canadian governments hold a combined stake of 10 percent.

Chrysler has three manufacturing plants in Canada and had to reach agreements with its unions there and the Canadian government under the restructuring. The automaker is not filing for bankruptcy in Canada, but the Canadian government, along with the province of Ontario, said they will provide $2.42 billion in financing to help the company restructure.

Fighting words

The bankruptcy signals that Obama is prepared to play hardball with holdout lenders rather than knuckle under to their demands and will likely set the tone for similar discussions with bondholders of General Motors–which is now on the clock to restructure its operations by the end of May.

While Obama voiced his support for Chrysler and the deal with Fiat, he was pointed in his criticism of the investors who did not agree to this deal. “I don’t stand with them. I stand with Chrysler’s employees and their families and communities,” the president said. “I don’t stand with those who held out when everybody else is making sacrifices. That’s why I’m supporting Chrysler’s plans to use our bankruptcy laws to clear away its remaining obligations.”

New Delhi: The Government has now opened up its New Pension scheme to all between the ages of 18 and 55. It promises returns of over 14 per cent and offers the lowest fund management charges in the world. This is particularly relevant if you are employed with a private firm and have no existing pension benefits.

This one is different from the existing pension schemes available with insurance companies.

Rather it’s similar to the pension scheme for central government employees, which yielded an average return of 14.5 per cent in 2008-09.

There are some other things that make the scheme viable.

The charges are extremely low at .0009 per cent. This is the lowest in the world compared to the 2 per cent charges for existing unit linked schemes.

The scheme is managed by the Pension Fund Regulatory and Development Authority (PFRDA) which certainly lends a sense of security in these troubled times.

Chairman PFRDA D.Swarup said, It’s very flexible. You have four different funds and also have the option to change your fund manager.”

Anyone between 18 to 55 can start investing even with 500 rupee as first installment. The minimum annual premium however must total to Rs 6,000.

Once invested, the person gets a Permanent Retirement Account Number or PRAN which can be accessed from anywhere.

Fund managers selected by the regulator will manage your funds.

Risk will have to be decided by the investor. However, an auto choice option profiles the investors risk appetite based on age. So a younger person will have more exposure to equity markets than someone who is 55 years old.

For this scheme to be a success, a lot will depend on the performance of private fund managers.

Beside tax benefit, safety, higher returns and flexibility are the things that make this scheme attractive during your winter days.

New Delhi: At a time when the global job scenario is gloomy, India Inc is expected to increase salaries up to eight per cent this year with infrastructure and FMCG sectors likely to see the maximum hikes, global HR consultancy Mercer says.

“Overall Indian companies are likely to increase salaries between six and eight per cent in 2009,” Mercer India business leader (information product solutions) Gangapriya Chakraverti told PTI.

Despite the economic slowdown troubling the corporate world, the country’s fast moving consumer goods (FMCG) and Infrastructure sectors are likely to see the highest increases in salaries this year.

“Sectors like FMCG and infrastructure are expected to get the highest hikes of 8-12 per cent this year,” Chakraverti added.

Meanwhile, financial services and Information Technology sectors, which have been severely impacted by the global slowdown, are unlikely to see any considerable increases in wages this year.

“IT and financial services may be the worst hit … IT sector may see an average salary increase of four per cent this year,” Chakraverti added.

With the beginning of the new financial year, companies are now drawing up plans related to the salary increments. However, in the wake of the severe economic conditions firms are looking for ways to answer the HR challenges in a balanced manner.

Mercer, which provides HR consultancy services to companies, has launched a new product for its clients to provide quarterly information such as changes in HR budget, staff turnover, headcount growth and planning, changes to benefits and incentive plans.

The services also include first-hand market information on how companies plan to address a specific hot issue as well.

Interestingly, focus on performance has been enhanced substantially following cost-cutting initiatives introduced by companies amid the slowdown.

The trend is shifting towards a greater difference between salary increases for the high performing individuals and the average performers.

New Delhi: Around 350 employees of Byrraju Foundation, a non-profit organisation founded by the family of tainted ex-promoter of Satyam Computer Ramalingam Raju, have quit since the multi-crore rupees scam surfaced in January.

The Foundation now has 850 people on its payroll, down from 1,200 immediately before the scam came to light, Byrraju Foundation CEO Jacob Verghese told PTI.

The employees left as they were told that only a part of their remuneration would be guaranteed as the Raju family would not be able to support the Foundation because of the legal trouble that they are in, he added.

“The Raju family used to provide Rs 10-20 crore out of the annual budget of Rs 30 crore of the Foundation. After the family got into legal trouble, we told the employees that only 40-50 per cent of their salaries would be guaranteed.

Many of them chose to quit,” Verghese said.

He, however, claimed many of those who left still work as volunteers on weekends for the initiatives of the Foundation.

On the funding of the Foundation, Verghese said the Rajus provided money out of their own pocket and “not a single penny was taken from Satyam”. The same is true for the Rs 30-40 crore per annum funding of EMRI, another

non-profit body set up by the Rajus.

Byrraju Foundation was set up in July 2001 to provide services in healthcare, environment, sanitation, primary education, adult literacy and skills development.

The Foundation works in 200 villages in six districts of Andhra Pradesh.

New Delhi: Bharti Airtel, India’s top mobile operator, reported a 21 per cent rise in quarterly profit as it added more users in the world’s fastest-growing wireless market and kept tariffs steady unlike its rivals.

The company, in which Southeast Asia’s top phone firm SingTel owns about 31 per cent, said its board had approved its maiden dividend and a two-for-one stock split.

Mobile operators have added subscribers at a rapid pace in India, with cheaper call rates and an expansion in networks boosting growth.

Operators signed up a total 130 million subscribers in the year to end-March, including a record 44.5 million last quarter.

But cut-throat competition is biting, with firms cutting tariffs and giving away free minutes.

“Our focus on rural penetration and customer affordability has been instrumental in delivering this strong growth,” Bharti Airtel Chairman Sunil Mittalsaid in a statement.

“The India growth story continues and we expect revival of the economy in the second half of this fiscal year.”

Bharti shares rose as much as 3.5 per cent in early deals after the results, and by 10:30 am (0500 GMT) had trimmed the gains to 0.7 per cent.

Bharti said January-March net profit rose to 22.39 billion rupees ($446 million) under US accounting standards from 18.52 billion rupees a year ago.

It suffered a forex loss of 2.36 billion Rupees as its net payout on foreign currency denominated loans increased due to a weaker Rupee, which fell 4 per cent against the dollar in January-March, the company’s fiscal fourth quarter.

Revenue rose 26 per cent to 98.25 billion rupees from 78.19 billion rupees.

A Reuters poll of 12 brokerages had forecast net profit of 22.1 billion rupees on revenue of 101.46 billion Rupees.

Bharti added a record 8.3 million mobile users last quarter to boost its total to nearly 94 million or about 24 per cent of the market.

EBITDA margin, a key gauge of profitability, was at 40.7 per cent in the March quarter.

Average revenue per user fell 15 per cent to 305 rupees last quarter as it won more new users in rural areas, where users talk less on phones and some use mobiles just to answer calls.

Minutes of usage fell 4 per cent to 485 minutes.

Bharti shares fell 13 percent in the quarter, underperforming a 0.6 per cent rise in the broader market.

Second-ranked Reliance Communications is set to announce a fall in net profit when it reports its earnings on Thursday.

New Delhi: Reliance Communications, India’s second-biggest mobile cell phone operator, posted a narrower-than-expected 3.3 per cent fall in quarterly profit on Thursday as the costs of expanding its GSM services weighed.

Reliance, which added a record 11.3 million subscribers during the March quarter after it expanded its GSM mobile operations to all of India, said its net profit fell to 14.54 billion rupees ($292 million) in its fiscal fourth quarter ended March, from 15.03 billion in the same period last year.

Revenue rose 15.3 per cent to 61.24 billion rupees. Analysts polled by Reuters had on average expected a net profit of 13.30 billion on revenue of 60.88 billion for the Mumbai-based firm, which had 72.7 million subscribers at the end of March accounting for more than 18 per cent of the wireless market.

Most of Reliance’s subscribers use a CDMA technology service but the company is aggressively pushing its GSM business with lower entry costs and free talk time.

It expanded its GSM service in January to cover all of India. Reliance’s larger rival Bharti Airtel on Wednesday reported a 21 per cent rise in quarterly profits.

MUMBAI: Shares of the country’s largest private sector firm, Reliance Industries, on Monday opened in the negative territory, while its refining subsidiary Reliance Petroleum started the day on a bullish note on the Bombay Stock Exchange. 

The board of directors of Reliance Industries and Reliance Petroleum on Monday approved the merger of the two firms, creating one of the world’s largest petrochemical entity and offered the shareholders of RPL one RIL share for every 16 shares held by them. 

Shares of Reliance Industries opened down 1.24%, then dipped further to touch an intra-day low of Rs 1,213.20, a fall of 4.09% from its last closing price. 

Meanwhile, shares of RPL opened up 7.61% on the BSE, and touched its intra-day high of Rs 82 after the board approved the scheme of amalgamation. 

“The share swap ratio was in favour of RPL and this got reflected during the opening trade on bourses,” Arun Kejriwal, director of Kejriwal research and investment services, said adding that at present both the shares would move according to broader market sentiment. 

Markets have adjusted to the share price difference and are ruling at par now, from here onwards shares of both the companies Reliance Industries and Reliance Petroleum would move in “uni-direction”, Kejriwal added.

In line with the smart recovery in local equity markets from its early low, the rupee also rebounded from its initial weakness and ended up by nearly four paise to 48.68/70 against the greenback.

In active trade at the Interbank Foreign Exchange (Forex) market, the local currency resumed sharply down at 48.83/84 a dollar from the previous close of 48.72/73, and touched a low of 48.88 per dollar.

More details

General Motors Corp. is planning to slash another 10,000 salaried jobs this year, saying the cuts are unavoidable with a government restructuring deadline looming and industrywide sales in one of the worst downturns in history.

The Detroit-based automaker said Tuesday it will reduce its total number of white-collar workers by 14 percent to 63,000. About 3,400, or 12 per cent, of GM’s 29,500 salaried US jobs will be eliminated.

Full details

Why is the trial for Satyam taking soo much of time, and Mr. Raju is given VVIP treatment?
what is the future of the people working in that company?

Where is 7000 Cr money? Any news on that? Why are ministers keeping their mouth shut in that?