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Market Update : 
U.S. Indexes in 5-day Rally; Blackboard Agreed to $1.6 Billion Buyout
Author: Arthi Gupta
Last Update: 1:55 PM ET July 01 2011

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10:30 AM New York – U.S. indexes traded higher for the fourth day in a row. Nortel concluded sales of 6,000 patents to a consortium of six companies for $4.5 billion. Health Management unit agreed to buy Mercy Health Partners for $525 million. Blackboard agreed to go private for $1.64 billion.

U.S. indexes advanced for the fourth day in a row after manufacturing index advanced more than expected.

The Institute for Supply Management’s factory index increased to 55.3% in June from 53.5% in May. The index had dropped from 60.4% in April and reversed in June on the strength of new orders and improved employment index. The new orders index increased to 51.6% in the month from 51% in May.

Asian markets turned lower after China Federation of Logistics and Purchasing said its purchasing managers'' index fell to 50.9 in June from 52 in May, third monthly decline in a row.

European indexes traded higher after euro-zone unemployment rate remained stable at 9.9% in May, data from Eurostat said and final Markit Manufacturing Purchasing Managers'' Index fell to 52 in June from 54.6 in May and unchanged from the earlier flash estimate.

Nortel Sells Patents to Consortium

A consortium consisting of Apple Inc., EMC Corp., Ericsson, Microsoft Corp., Research In Motion and Sony Corp. emerged as the winning bidder for the 6,000 patents up for auction by bankrupt Nortel for $4.5 billion.

The sale includes patents and patent applications covering wireless, wireless 4G, data networking, optical, voice, internet, service provider, semiconductors and other patents.

Oshkosh Confirms Icahn Stake

Oshkosh Corporation, a maker of specialty vehicles and vehicle bodies acknowledged that Carl Icahn and related persons have acquired a stake of 9.5% of the company''s common stock, consisting of a combination of shares and call options.

Health Management Unit Acquires Mercy Health Partners

Health Management Associates, Inc., the acute care hospitals operator said its Health Management unit executed an agreement to acquire the assets of Mercy Health Partners, a subsidiary of Catholic Health Partners, Inc., for about $525 million plus certain working capital adjustments and the assumption of long-term lease liabilities.

Providence Equity Partners Buys Blackboard

Providence Equity Partners, Inc., the private equity firm inked a deal to acquire educational software and systems provider Blackboard, Inc. for $45 a share in an all-cash deal of $1.64 billion, plus the assumption of approximately $130 million in net debt.

Earnings Review

Apollo Group, Inc. (APOL), the private education provider said third quarter net revenue fell 7.6% to $1.24 billion from $1.34 billion in the same quarter last year. Net income in the quarter climbed 18.5% to $212.4 million or $1.51 per share compared to net income of $179.3 million or $1.18 per share for the year-ago quarter.

AZZ Incorporated (AZZ), the electrical equipment and components manufacturer reported first quarter revenues surged 48% to 114.3 million, from $77.5 million in the comparable quarter last year. Net profit in the quarter rose 48% to $9.5 million or 75 cents per diluted share compared to net profit of $6.4 million or 51 cents per share last year.

Darden Restaurants, Inc. (DRI), the multi-brand restaurant operator said fourth quarter sales increased 7% to $1.99 billion from $1.86 billion in the same quarter last year. Net earnings in the quarter rose 19% to $137.4 million or 99 cents per diluted share compared to net earnings of $115.6 million or 80 cents per share in the prior-year quarter.

General Motors Company (GM), the car maker estimates total Chevrolet sales to rise 15% for the first-half of 2011.

Hyundai Motor Co. Ltd., the Korean automaker reported total sales rose 12.3% to 352,255 units for June 2011 compared with 313,579 units in the prior-year period. Year-to-date total sales improved 10.6% to 1.95 million units from 1.76 million units a year earlier.

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Sources: Data collected by and from company press releases, filings and corporate websites.
Market data: BATS Exchange. Inc.

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