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Business news briefs — Aug. 16

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ENERGY

New interest in Ohio shale

Is former Chesapeake Energy CEO Aubrey McClendon targeting Ohio’s Utica shale with his new energy and drilling companies? A trade publication, Upstream, that covers the oil and natural gas industry, reported Friday that McClendon may have acquired 22,535 acres in Ohio from the EnerVest Ltd. companies, and has bid on 50,000 additional Ohio acres held by Shell.

Upstream reported that McClendon has raised $1 billion and is very interested in getting back into Ohio’s Utica shale through American Energy Partners, one of his new companies.

He declined to comment on possible Ohio deals, when contacted.

He was ousted by Oklahoma-based Chesapeake Energy last March after the company had incurred major debt and the price paid for natural gas had dropped significantly.

His old company holds 1.3 million acres in eastern Ohio and is the No. 1 Ohio Utica driller.

The EnerVest companies announced on Aug. 9 that they were selling the leases in Harrison, Guernsey and Noble counties for $284.3 million to an unidentified buyer.

The EnerVest companies will retain royalty interests on 4,345 of those acres. That deal is expected to close this fall.

AUTO INDUSTRY

GM recalls Chevy Cruzes

General Motors is recalling nearly 293,000 Chevrolet Cruze compact cars in the U.S. because the power-assisted brakes can fail. The company says the recall affects Cruzes made in Lordstown from the 2011 and 2012 model years.

The cars have 1.4-liter turbocharged gasoline engines and 6T-40 six-speed automatic transmissions. GM says the power brake boosters can fail and in rare cases, drivers may have to put extra pressure on the pedals to stop the cars. GM says Cruze brake problems have caused 27 low-speed crashes but no injuries. Dealers will replace a switch in the power brake vacuum pipe assembly for free.

MEDIA

News sites cut 500 jobs

AOL Inc. said it is eliminating about 500 jobs at its struggling Patch local-news business, or close to half of the division’s more than 1,000 employees. Chief Executive Officer Tim Armstrong met with Patch staffers to announce the job cuts. About 350 people were expected to lose their jobs Friday and about 150 will be asked to stay for another 60 days as the company looks to find partners for some of the 900 Patch sites.

Area news sites were: Cuyahoga Falls, Stow, Fairlawn-Bath and Twinsburg in Summit County; Kent in Portage County, and North Canton in Stark County.

Armstrong, who has said he aims to make Patch profitable by the end of the year, told staffers last week the company may close down or find partners for 400 Patch websites. On Friday, Armstrong was telling employees the company may close as many as 20 percent of the Patch sites and find partners or consolidate another 20 percent, Bloomberg News reported.

Patch reporters cover school board meetings, local businesses and other neighborhood stories. It has been a costly part of AOL’s strategy to transform the dial-up Internet service provider into an advertising-driven content publisher. The company has spent more than $300 million developing the sites.

While the division more than doubled its sales last year to just under $35 million, Patch’s annual costs range from $126 million to $162 million.

BANKING

New PNC board member

PNC Financial Services Group Inc., the largest shareholder of asset manager BlackRock Inc., named BlueMountain Capital Management LLC co-founder Andrew Feldstein to the bank’s board. Feldstein, 48, helped start his $15.7 billion credit and equity derivatives hedge-fund firm in 2003 after working for a decade at JPMorgan Chase & Co.

He was appointed to the risk and compensation committees, according to a regulatory filing. PNC Chief Executive Officer Bill Demchak, who succeeded Jim Rohr in April, worked with Feldstein at New York-based JPMorgan, now the biggest U.S. bank, where they helped build the company’s derivatives business.

ENTERTAINMENT

Game app for Lionel Trains

Lionel Trains announced the creation of an iPad game called Lionel Battle Train. The game challenges players to deliver cargo on a train that can be customized while fighting off enemy “RoboCars” through 19 missions and three regions.

Lionel said the app is available free in the U.S. App Store.

Compiled from staff and wire reports


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