GM, Ford U.S. March Sales Increase Less Than Predicted General Motors Co. and Ford Motor Co. posted gains in U.S. vehicle sales that trailed analysts' estimates while Chrysler Group LLC and Nissan Motor Co. reported better-than-projected increases.
GM sales rose 12 percent to 231,052 while Ford deliveries advanced 5 percent to 222,884 cars and light trucks. The average of 10 estimates was for a 19 percent gain at GM and 5.5 percent at Ford. Chrysler, controlled by Fiat SpA, said its U.S. sales climbed 34 percent to 163,381 and Nissan's sales rose 13 percent to 136,317, exceeding predictions.
Light-vehicle sales in March may have run at a 14.5 million seasonally adjusted annual rate, the average estimate of 16 analysts surveyed by Bloomberg. Job gains and buyers who put off car purchases during the recession are driving the fastest three-month auto-sales pace in four years, even as average U.S. unleaded gasoline prices rose 20 percent since the end of 2011.
"As unemployment comes down and consumer confidence goes up, we see the consumer going out and buying that new vehicle that they put off buying for a number of years," Joseph Spak, an analyst for RBC Capital Markets in New York, said in an interview yesterday on Bloomberg Television's "Street Smart."
The average estimate of 10 analysts surveyed by Bloomberg was for Chrysler's sales to rise 31 percent. The average of seven estimates was for an 11 percent climb at Nissan.
The Fiat 500 achieved record monthly sales of 3,712, according to Chrysler's statement. Ford said deliveries of the Focus compact rose 65 percent to 28,293.
Broad Gains
Gains extended beyond the Fiat 500. Sales of Ford's F- Series pickups increased 9 percent to 58,061. Chrysler said deliveries of its 200 and 300 sedans more than doubled from a year earlier. Sales of the Jeep Liberty, Wrangler and Grand Cherokee sport-utility vehicles each climbed by at least 43 percent, and Ram pickup deliveries increased 23 percent to 26,960.
"People didn't buy for a number of years, so you still have some remaining pent-up demand," Bert Boeckmann, the owner of a Ford dealership in North Hills, California, said yesterday in a phone interview. "You have a more positive attitude from people about buying cars right now, and you have people who are justifying it on the basis of improving their mileage."
A 14.5 million sales rate for March would exceed the 13.1 million pace from a year earlier and set an average rate of 14.6 million for the first quarter, ahead of analysts' estimates for full-year deliveries. Total light-vehicle sales may rise to 1.42 million, the average of eight analysts' estimates. That would be the highest monthly total since August 2007, according to researcher Autodata Corp.
Jobs, Confidence
The 1.2 million jobs created the past six months, the best six-month job growth stretch since 2006, has sent unemployment to a three-year low, according to Labor Department figures. The Conference Board's consumer confidence index held near the highest level in a year in March, the New York-based private research group said on March 27.
Analysts at Morgan Stanley, Deutsche Bank AG, Citigroup Inc. and TrueCar.com last month increased their estimates for full-year sales. The four companies increased 2012 estimates by an average of 550,000 vehicles to 14.5 million. IHS Automotive said today it estimates 14.2 million light-vehicle deliveries in the U.S. this year, up from a previous estimate of 14 million.
Auto Recovery
"We see the economy slowing over the next three to six months," George Magliano, senior principal economist for IHS Automotive, said today at an auto forum in New York. "That is going to slow down the auto recovery, but it certainly isn't going to derail it."
GM sales were boosted by the Chevrolet Sonic subcompact that gets 33 miles (53 kilometers) per gallon in combined city and highway driving. The carmaker said today it delivered more than 100,000 vehicles, including the Sonic, that get 30 mpg or more in highway driving.
Toyota Motor Corp. probably increased total sales by 15 percent, according to seven analysts' average estimate. The Toyota City, Japan-based automaker began U.S. deliveries of its 50 mpg Prius c hybrid subcompact last month. The Prius "family" of four models, including the original hatchback, exceeded 25,000 units in March, a record for the model line, Bob Carter, group vice president of U.S. sales, said yesterday in an e-mail.
Volkswagen AG's namesake brand increased sales by 35 percent to 36,588, according to a company statement. The gain is matches the 35 percent gain estimated for combined total deliveries of its Volkswagen and Audi brands, the average of three estimates.
Honda Motor Co.'s sales may have increased 5.3 percent, the average of seven analysts' estimates. Affiliates Hyundai Motor Co. and Kia Motors Corp. may have combined to sell 18 percent more vehicles than a year earlier, the average of five analysts' estimates.
Molson Coors Agrees to Buy Brewer StarBev for $3.5 Billion
Molson Coors Brewing Co., the U.S. maker of Carling lager, agreed to buy StarBev LP for 2.65 billion euros ($3.54 billion) to add beer brands such as Staropramen and provide a route into central and eastern Europe.
The acquisition from private-equity firm CVC Capital Partners Ltd. and StarBev management will help Denver-based Molson Coors expand outside its main regions of North America and the U.K., where high unemployment and aggressive competition are weighing on growth. StarBev operates nine breweries in Central and Eastern European countries including the Czech Republic, Hungary, Romania and Bulgaria.
"Molson Coors's portfolio has had an extremely mature- market focus," said Melissa Earlam, an analyst at UBS AG in London. "Relative to their peers, they're very underrepresented in emerging markets."
Molson Coors fell 1.2 percent to $45.10 at 9:54 a.m. in New York. The shares had gained 4.9 percent this year before today.
StarBev generated earnings before interest, taxes, depreciation and amortization of 241 million euros in 2011, Molson Coors said in a statement. The acquisition represents a multiple of about 11 times Ebitda, the company said.
The deal would be the largest brewery acquisition since SABMiller Plc bought Australia's Foster's Group Ltd. in December for about $12.9 billion, including debt, according to data compiled by Bloomberg.
Deal Financing
"The headline multiple for the deal looks quite reasonable, and net-net, what they're buying looks to be more profitable than I'd expected," Earlam said.
Committed financing is in place to complete the acquisition from CVC and StarBev management, Molson Coors said. Production and purchasing efficiencies resulting from the deal will lead to pretax savings of about $50 million by 2015, the brewer said.
Permanent funding for the transaction will take the form of $3 billion in cash and debt and the issue of 500 million euros of convertible debt to the seller, Molson Coors said.
Brewers including Kirin Holdings Co., Asahi Group Holdings Ltd. and Suntory Holdings Ltd. of Japan had expressed interest in buying StarBev, people with knowledge of the plans said in February. CVC, which manages a 10.8 billion-euro European buyout fund, purchased the operations from Anheuser-Busch InBev NV in 2009 for 1.5 billion euros.
AB InBev, the world's biggest brewer, had a right of the first option to buy StarBev, according to people with knowledge of the matter. It sold the assets to pay down debt from InBev NV's $52 billion acquisition of Anheuser-Busch Cos. in 2008.
StarBev Brands
StarBev has more than 20 brands including local labels such as Borsodi, Kamenitza, Bergenbier, Ozusko, Jelen and Niksicko, and also distributes brands such as Stella Artois, Beck's, Hoegaarden, Lowenbrau and Leffe under license.
"StarBev, as a market leader in the CEE region, provides Molson Coors with a great platform for growth and an excellent foundation from which to extend our key brands, such as Carling, into Central and Eastern Europe," Molson Coors President and Chief Executive Officer Peter Swinburn said today in the statement. The beer market in the region is "attractive, with strong historical trends and upside potential," he said.
The acquisition will "also enhance our portfolio in some of our current and planned markets," Swinburn said, as the company seeks to "deepen our reach into growth markets."
Antitrust Approval
CVC is looking to return cash to investors and invest the remainder of its pool before raising a new one next year. The firm is considering selling shares in car-racing company Formula 1 through a listing in Singapore, people familiar with the matter said last month. Earlier this year, it agreed to buy Ahlsell AB, a Swedish construction products supplier, from Cinven Ltd. and Goldman Sachs Group Inc.
The StarBev acquisition is subject to approval from European competition authorities, according to the statement, and is expected to close in the second quarter of 2012. StarBev competes with brewers including SABMiller, Heineken NV and Carlsberg A/S in the central and eastern European region.
Morgan Stanley served as the lead financial adviser to Molson, while Barclays Plc and Deutsche Bank AG acted as co- advisers and Kirkland & Ellis LLP provided legal counsel. Morgan Stanley and Deutsche Bank are providing committed debt financing for the deal.
Nomura Holdings Inc. Provided financial advice to Starbev and CVC, while Freshfields Bruckhaus Deringer LLP served as legal adviser.
Facebook Files Patent Counterclaims Against Yahoo Facebook Inc., which operates the world's biggest social-networking site, accused Yahoo! Inc. of infringing 10 patents through its home page and Flickr photo- sharing service and in ads displayed throughout its site.
Facebook, which was sued by Yahoo for patent infringement last month, made the counterclaims today in a federal court filing in San Francisco. Facebook denied stealing Yahoo's technology, saying its rival's patents are either invalid or its claims legally barred and the lawsuit should be dismissed.
"While we are asserting patent claims of our own, we do so in response to Yahoo's shortsighted decision to attack one of its partners and prioritize litigation over innovation," Ted Ullyot, Facebook's general counsel, said in an e-mail.
Yahoo, owner of the most popular U.S. Internet portal, has been struggling to keep pace with Google Inc. and Facebook, which have lured away users and ad dollars. Facebook filed for an initial public offering in February that may value the business at $75 billion to $100 billion, people familiar with matter have said.
David McCombs, an intellectual property lawyer at Haynes & Boone LLP in Dallas, said the countersuit by Facebook means "the gloves are off, and they will fight it out."
'Picks a Fight'
"If someone picks a fight with you, then you certainly would respond in kind, typically," he said today in a phone interview. "You would expect Facebook to have intellectual property assets that would be applicable to anyone that's operating in that space."
Yahoo, based in Sunnyvale, California, alleged in its lawsuit that Facebook infringes patents covering functions critical to websites, including Internet advertising, information sharing and privacy. It's seeking an order barring Facebook from infringing 10 patents and for triple damages.
The lawsuit followed Yahoo's statements in February that Menlo Park, California-based Facebook, like other Web companies, must license its technology.
"We have only just received Facebook's answer and counterclaims, but on their face we believe they are without merit and nothing more than a cynical attempt to distract from the weakness of its defense," Yahoo said in an e-mailed statement. "We have proposed that Facebook join us in discussions to resolve the matter, but our overtures have been rejected. As a result, we are prepared to continue to seek redress through the courts."
Facebook's Counterclaims
In its counterclaims, Facebook says its patents are infringed directly by Yahoo's home page and Flickr and through advertisements displayed throughout Yahoo's site on finance, sports, games and shopping services.
Facebook patents at issue in the counterclaims include those related to technologies for generating a feed of stories personalized for social network users, posting headlines and distributing user profiles over a network. The company is seeking court orders declaring that it doesn't infringe Yahoo patents, blocking Yahoo from using its patents and awarding it unspecified damages from Yahoo.
Yahoo lost its No. 1 spot to Facebook last year in the U.S. market for display advertising, which includes video and graphically based marketing messages, according to EMarketer Inc. In January, Yahoo reported fourth-quarter revenue of $1.17 billion, excluding sales passed on to partner sites.
Facebook, which has more than 845 million users, is seeking $5 billion in what could be the largest Internet IPO on record.
The case is Yahoo! Inc. v. Facebook, 12-cv-01212, U.S. District Court, Northern District of California (San Jose).
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