News Briefs: General Motors Says Bankruptcy “Probable”, British Telecom To Cut 15,000 Jobs

GM CEO Says Bankruptcy “Probable;” Wal-Mart Posts Flat 1Q Profit; BT Group Cuts Jobs, Dividend; PNC to Sell Stock, Raise Capital; GM, Chrysler Closures to Idle 50,000 Workers; Madoff Trustee to Pay Investors $100 Million; Oil Falls on IEA Forecast

• General Motors Corp. (GM) Chief Executive Fritz Henderson yesterday (Thursday) told Bloomberg News that bankruptcy is “probable.” The top U.S. automaker has until June 1 to cut costs and debt or face a government-imposed bankruptcy and asset sale.

• Wal-Mart Stores Inc. (WMT) posted a flat quarterly profit - a result of shoppers taking advantage of low prices while the store took hits from a strengthened U.S. dollar, Reuters reported. The retail giant earned 77 cents a share in the first quarter ended April 30, compared to 76 cents a share, the year prior.

• The United Kingdom’s largest phone company, BT Group PLC (BT), announced plans to cut 15,000 more jobs and lowered its dividend 58.9% to 6.5 pence a share. The company made those announces as it posted a fourth-quarter loss of 977 million pounds ($1.48 billion) on costs to overhaul its global services division, Bloomberg reported.

• Pittsburgh-based PNC Financial Services Group Inc. (PNC) said it plans to sell as much as 15 million shares to raise up to $653 million in capital, Reuters reported. After last week’s bank stress tests, regulators told PNC it needed to raise $600 million to stay afloat should the global economy deteriorate further.

• Chrysler LLC and General Motors Corp. (GM) will tell up to 3,000 U.S. dealerships this week they are closing, which could result in another 150,000 job losses, according to the National Automobile Dealers Association. The losses would come on top of the 50,000 people already out of work because of the dealer shutdowns that have taken place so far this year. Chrysler, according to a bankruptcy filing, is exercising its right to reject contracts at 789 dealers - about a quarter of its U.S. retail network. The targeted dealers represent only 14% of Chrysler’s total sales volume, MarketWatch reported.

• Irving Picard, the trustee liquidating Bernard L. Madoff’s investment company, said he expects to approve at least $100 million of investor claims by May 25 and achieve “significant” clawback-suit settlements in the next few weeks, Bloomberg reported. Picard said he has recovered as much as $1 billion of Madoff- related assets and that he has filed lawsuits to recover another $10.1 billion.  Bernard Madoff on March 12 pleaded guilty to running the biggest Ponzi scheme in U.S. history and faces as much as 150 years in prison when he is sentenced June 29 in Manhattan federal court.

• The Paris-based International Energy Agency (IEA) now predicts global oil consumption will fall this year at the fastest rate since 1981. The adviser to 28 industrialized nations on energy policy, said the rise in oil prices to a six-month high above $60 this week was due to sentiment rather than supply and demand fundamentals, with consumption set to fall by 2.56 million barrels per day (bpd) in 2009.

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