Filed under: Deals, General Motors (GM)

General Motors (NYSE: GM) was cited in The Wall Street Journal last evening saying it would be selling its profitable medium-duty truck business to Navistar (OTC: NAVZ) in a deal that was announced this day as part of a non-binding deal between the two companies.

Financial terms of the deal are still unreleased, but GM continues to shed its business of non-core assets as a way to return to consistent profitability — specifically related to its North American operations. Since GM does not break out sales in exact fashion in its financial results, it’s unclear how much of an impact this deal will have on the automaker.

It is known that GM sells about 50,000 trucks from the medium-duty line per year in a product segment that includes dump trucks and small buses. Navistar’s expertise in this field makes it a perfect choice to purchase the business from GM, although it’s actually a profitable arm of the global automaker. Is raising capital more important, though, than selling 50,000 profitable products? This deal would seem to suggest a strong yes.

Right now, no official statement on closing an actual deal as been made on the GM sale except for the non-binding agreement between it and Navistar released just this morning. Will one come today? If not, it will be here soon.

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Filed under: Deals, Microsoft (MSFT), Viacom (VIA)

Microsoft (NASDAQ: MSFT) has joined up with media giant Viacom (NYSE: VIA) to share revenue and license content across its platforms — like its on the web MSN and Xbox 360 platforms — to the tune of $500 million.

The partnership will likely have an impact stretching over five years ($100 million a year) and will involve advertising in addition to content and revenue sharing during that time. Microsoft will gain the capability to get Viacom’s bevy of popular content on its properties, with lucrative shows and television channels Comedy Central, MTV Networks and Nickelodeon among others.

Microsoft will also purchase ads on Viacom’s television networks as well as its on the internet properties, and Viacom will most likely eventually drop Google’s (NASDAQ: GOOG) AdSense platform for Microsoft’s adCenter on the web advertising system in a blow to the search leader. Is Microsoft serious about competing with Google’s stranglehold on internet advertising? This latest deal with Viacom would seem to suggest a definite yes.

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Filed under: Deals, Competitive strategy, General Motors (GM)

General Motors (NYSE: GM) said Thursday it will sell its mid-size truck unit, which built about 40,800 vehicles in 2006, to Navistar International. Financial terms were not disclosed.

GM’s shares fell 20 cents to $26.46 in Thursday midday trading.

GM stated the agreement constitutes another step in the company’s plan to focus on designing, manufacturing and selling cars and light trucks around the world. GM added that the deal would leverage Navistar’s strengths in commercial trucks and engines, enhance its economies of scale and lower costs.

Good decision

Analyst C. Leonard Bauer, formerly of Prudential, stated he likes the sound of the Navistar deal.

“This will enable GM to allocate more resources on its core: vehicles and light trucks,” Bauer said. “I like the sale to Navistar in that it gets GM out of a space that did not represent a massive gainer. GM has seen the future, and for them it’s not in manufacturing mid-size trucks.”

GM evaluation

However, Bauer would not be a buyer of GM’s shares right now. Bauer said he does not currently own GM shares.

“GM is about half-way there, regarding the turnaround. They’ve done a good job on legacy costs and on re-focusing operations, but now we need to see the new roll-outs, at least two or three innovative, in-demand vehicles,” Bauer stated. “We also have to be concerned about the economic headwinds in 2008, a possible U.S. economic slowdown and high gas prices, which would certainly delay GM’s recovery.”

Bauer said he’ll review GM’s Q1 and Q2 2008 earnings reports before considering a purchase of GM, adding that he still sees the stock “testing $20 or perhaps even $15 in 2008.”

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Filed under: Deals, Industry, Law, Barclays plc ADS (BCS), Bear Stearns Cos (BSC)

Whatever the legal result of Barclays‘ (NYSE: BCS) lawsuit against Bear Stearns (NYSE: BSC) over hedge fund losses, the UK bank should have know better.

Much of the current problem related to mortgage-related securities bought and held by big financial companies is why the “due diligence” was so thin.

According to Reuters, “Barclays Bank Plc accused Bear Stearns Co Inc on Wednesday of loading one of its hedge funds with about $500 million in troubled assets just weeks before it collapsed with another fund.”

Barclays has a case if Bear Stearns simply dumped risky securities into the fund without any warning. But the UK bank certainly knew the overall asset mix of the pools and was still making a bet that mortgage-related securities would do well.

Did Bear Stearns lie to Barclays? Did it mislead the large bank? Perhaps. But the greed that drove big banks to invest in these instruments wasn’t limited to Barclays. Neither was the lack of understanding about how the securities worked, or what their risks were.

Barclays can blame itself on those counts.

Douglas A. McIntyre is an editor at 247wallst.com.

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Filed under: Before the bell, Earnings reports, Deals, Rumors, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Apple Inc (AAPL), General Motors (GM), Boeing Co (BA), Carnival Corp (CCL), Tribune Co. (TRB), Research in Motion (RIMM), Dow Chemical (DOW), Eaton Corp (ETN)

Before the bell: Futures rise following Oracle’s earnings; ahead of data

Following the new emission laws, General Motors (NYSE: GM) stated the law could “hamper muscle cars.” Also, the Wall Street Journal reported that GM may sell its medium-duty truck unit to Navistar International.

Tribune Co. (NYSE: TRB) is bracing for the “Sam Zell era” as he’s set to take the ailing newspaper and TV company private with the expected closing of his $8.2 billion buyout as soon as Thursday.

According to Think Secret, Apple Inc. (NASDAQ: AAPL) and Think Secret have settled their lawsuit in a confidential, “amicable” settlement. While no sources were revealed, Think Secret will no longer be published. Bloggers lament ThinkSecret: TUAW and Engadget — if this is true, I wonder if Apple made the right move.

Research In Motion (NASDAQ: RIMM) is expected to post earnings of 62 cents a share in the third quarter. Cruise operator Carnival Corp. (NYSE: CCL) is also scheduled to report earnings this day.

Eaton Corp. (NYSE: ETN) said it’s planning to buy two firms in Europe and Asia to expand its electrical systems business outside the United Says. The deal is valued at as much as $2.8 billion.

Boeing Co. (NYSE: BA) stated Thursday it signed a 10-year agreement with India’s Hindustan Aeronautics Ltd. “targeting the transfer of more than $1 billion of new aerospace manufacturing work to India.”

The EU isn’t happy with Google Inc’s (NASDAQ: GOOG) planned takeover of rival DoubleClick for $3.1 billion, saying it would “harm European citizens through greater intrusion of privacy, the EU’s top consumer lobby BEUC stated on Thursday.”

The large three Internet companies, Microsoft Corp. (NASDAQ: MSFT), Yahoo Inc. (NASDAQ: YHOO) and Google have agreed to a combined $31.5 million settlement with the U.S. government for accepting ads promoting illegal online gambling, as well as to cease accepting ads for sports wagering and other on the web gambling.

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