Industry Week in Review – February 15, 2013
On Tuesday Italian authorities arrested Finmeccanica CEO Giuseppe Orsi for possible engagement in corrupt activities. Prosecutor Eugenio Fusco noted that Mr. Orsi and Bruno Spagnolini, CEO of helicopter unit AgustaWestland, had been under investigation for several months for whether or not AgustaWestland paid bribes in order to secure a $750 million sale of 12 helicopters to the Indian government. The arrest comes after several legal issues for the Italian defense contractor, as other prosecutors have been investigating alleged corrupt activities in the Company’s Latin American, Asian, and domestic operations. The Company announced on Thursday that Alessandro Pansa would replace Orsi as CEO and COO, with Admiral Guido Venturoni becoming vice-chairman of the group.
In Washington, the Senate delayed Defense Secretary Nominee Chuck Hagel’s confirmation vote after failing to garner the 60 votes required to overcome a Republican filibuster. Senate Republicans have been demanding additional information from both the White House and from Mr. Hagel, and refused to allow a vote on his nomination before receiving sufficient time to review the requested information. The Senate is expected to hold a vote closing the debate immediately after the upcoming recess, at which point the chamber will be able to hold a vote on the nomination.
Big Movers
Ultralife Corp. (Up 15.7%) – shares were up for the week following the release of 4Q12 earnings. The Company announced EPS of $0.12 for the quarter, beating consensus estimates of $0.04, while revenues of $29.3 million for the quarter beat estimates of $27.5 million.
GenCorp Inc. (Up 9.7%) – shares were up for the week after the company released earnings for its fiscal fourth quarter ended November 2012. The Company earned $2.8 million on sales of $298.2 million for the quarter, up from earnings of $500,000 on sales of $252.2 million in fiscal 4Q11.
Finmeccanica SpA (Down 16.3%) – shares were down for the week following the arrest of CEO Giuseppe Orsi on suspicion of corrupt activities, described above.
Relevant Transactions
Chicago Bridge & Iron completed its $3.1 billion purchase of The Shaw Group, which was initially announced in July 2012. The boards of both companies had approved the deal in December. According to CB&I President Phillip Asherman, the transaction expands the Company’s capabilities and expertise, enabling it to address energy infrastructure needs around the globe.
