Alberta’s oil and gas sector showed off its renewed vitality, as some companies posted strong quarterly results and others intensified the recent merger mania. Alberta Energy Co. Ltd. of Calgary posted stunning firstquarter profits—almost $121 million, compared with $17.8 million for the same period last year. The company said the surge was due to increased production and higher world prices for crude oil. Ulster Petroleums Ltd. of Calgary also reported a big profit hike, noting that new natural gas finds and strong commodity prices helped it to a first-quarter profit of $10 million, up from $1.9 million a year earlier.
Ulster, the target of a hostile takeover bid from Hunt Oil Co. of Dallas, is one of several Alberta companies in-
volved in mergers and acquisitions. Last week, three Calgary energy service providers, Phoenix Technology Services Ltd., Octane Energy Services Ltd. and Total Energy Services Ltd., said that they would merge. And TransAlta Corp., which owns gas power plants in Canada and Australia, said it will acquire a 50-per-cent interest in a U.S. company that manages American power plants.
Alcan’s European merger plans stalled
An ambitious three-way merger between Alcan Aluminium Ltd. of Montreal, Zurich-based Alusuisse Lonza Group Inc., known as Algroup, and Pechiney of Paris, fell apart, leaving the Canadian company to pursue an earlier deal with the Swiss group. The three-way proposal, touted as a cost-saving measure for all three partners, died when Alcan refused to sell its 50-per-cent stake in a German aluminum plant to satisfy the European Commission’s concerns about market dominance. Alcan confirmed that it will make a new offer for the Swiss group by June 30.
It’s a good time to be a restaurant owner. According to Statistics Canada, out of every $ 100 Canadians spent on food in 1998, $34.60 went to meals
Personal spending by Canadians on restaurant, takeout and other _ catered food, including taxes (in billions) —
I 22 20 § .18 I
I 14 Ö
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
outside the home. Consumers ponied up $26.9 billion on eating out—a 42per-cent increase from 1989. People in British Columbia, Alberta and Quebec spent more, relative to population, than those in other provinces.
The shift from buying food in grocery stores to eating in restaurants, fast-food places and bars has been under way since the 1960s. Statistics Canadas explanation for this trend is not surprising: a growing Canadian economy, greater time pressures facing consumers, more single-person households—and the proliferation of restaurants.
Nelvana looks south
Canadian animation legend Nelvana Ltd. of Toronto plans to buy Klutz, a California-based children’s book publisher, for $108 million. Nelvana, which produces such television cartoons as Rupert and Franklin, said the deal will help diversify its brands and revenues. Klutz is known for its activity books aimed at sixto 12-year-olds.
Ford parts spinoff
The world’s second-largest automaker, Ford Motor Co., announced it will spin offits auto-parts division, Visteon. Ford, based in Dearborn, Mich., said making the $28-billion operation independent will enhance shareholder value, partly by allowing the division to compete more aggressively for nonFord customers.
Frustrated by repeated efforts to get a toehold in the European market, Canadian winemakers want Ottawa to take their case to the World Trade Organization. The European Union has banned all sales of Canadas unique Icewine and restricts sales of all other Canadian wines to $500,000 a year.
A licence to acquire
Banking behemoth Chase Manhattan Corp. will pay $11.1 billion for Robert Fleming Holdings Ltd., one of Britain’s last independent investment banks. The deal gives Chase, the third-largest bank in the United States, a new way into the growing business of asset management in Asia and Europe. Ian Fleming, creator of the James Bond spy books, was part of the family that still controls the London-based company.
QLT wins U.S. approval
Vancouver-based QLT PhotoTherapeutics Ltd. won the right to sell its light-sensitive eye drug, Visudyne, in the United States. In development for eight years, the medication is intended for patients suffering from age-related macular degeneration, the leading cause of blindness in those over 50. Every year, about 180,000 Americans are diagnosed with the condition. Canadian approval for the drug is expected later this year.
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