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Irsay: Manning could get 5-year or 6-year deal

INDIANAPOLIS – Peyton Manning could still be raking in the big bucks at age 40.

On Thursday, at a hastily called news conference, Colts owner Jim Irsay said he expects Manning to sign a record-setting deal before next season. Tom Brady currently holds the distinction for the highest annual average salary after agreeing to a four-year deal worth $18 million per year in September.

Manning's deal will not only be richer but also longer.

"I think six years is certainly a possibility, five or six years," Irsay said. "There's not a definitive number that I'm stuck on. You don't know how much longer he can play. You hope that it's five years, maybe six years. Until you get longer down the road, it's really uncertain."

Irsay's comments came two days after Indy used the exclusive franchise tag to keep the only four-time MVP in league history off the free-agent market. Manning, who turns 35 next month, will not be allowed to negotiate with other teams.

If he plays under the tag next season, Manning would make about $23 million.

Betting a long-term deal done quickly could serve three key purposes: lowering Manning's one-year salary cap number, putting more money in Manning's pocket right away because of large bonuses, and giving the Colts room to keep other key players around their star quarterback.

For more than a year, Irsay promised to make Manning the highest-paid player in league history. Apparently, Manning's agent, Tom Condon, now has the proof.

"The contracts out there have been compared and Brady and him have been sort of tied at the hip," Irsay said. "I've made an offer higher than that contract."

Irsay did not say how much the current offer is worth.

So when will all this get resolved?

Irsay said negotiations were "going well" and reminded fans he took a similar tack in 2004 — giving Manning the exclusive franchise tag — before signing him to a seven-year, $98 million deal in March. Indy then rescinded the designation.

The sequel could play out the same way.

While Irsay remains hopeful the two sides can work out a deal before the collective bargaining agreement expires March 3, he's prepared to have talks linger into the summer.

"I would like to see something get done before then," Irsay said. "But there's two sides to the negotiations, so either side can only go as fast as the other side. The sooner, the better yes. But if it doesn't get done before then, we can get things done this summer."

Manning repeatedly declined to comment on his contract situation during the season, and Condon told The Associated Press last month he expected the two sides to reach agreement, though he didn't establish a timetable.

That's not the only contract issue Irsay is dealing with this winter.

Irsay acknowledged he has opened negotiations to extend the contract of Adam Vinatieri, considered the best clutch kicker in league history. Vinatieri, running back Joseph Addai and linebacker Clint Session are among a long list of Colts players who could hit free agency once the owners and players reach a settlement.

And Irsay is still trying to decide what to do with safety Bob Sanders, the 2007 NFL defensive player of the year. Sanders signed a five-year, $37.5 million contract after the 2007 season, but injuries have limited him to just nine regular-season games the last three seasons.

"Before March third, I think we'll probably have some sense on that direction," Irsay said. "Again, there's nothing definitive. We've talked through a lot of different scenarios, I can't say definitively what direction we're going there."

Orthodox church sues over temple destroyed on 9/11

NEW YORK – The Greek Orthodox church sued the public agency that owned the World Trade Center on Monday, saying the agency reneged on a deal to rebuild a church that was destroyed in the 9/11 attacks.

The church says the Port Authority of New York and New Jersey broke a 2008 promise to rebuild the St. Nicholas Church at a new location down the block from its old site. It also says the Port Authority has started excavating church property without permission as part of the new business and transportation complex at Ground Zero.

"This is not about money, this is about their commitment to rebuild the only house of worship destroyed at Ground Zero," church spokesman Mark Arey said.

The Greek Orthodox Archdiocese of America filed its lawsuit against the Port Authority in a U.S. district court in Manhattan.

The St. Nicholas Church was built in 1916 and was crushed when the World Trade Center towers collapsed. As part of the neighborhood's reconstruction, the Port Authority proposed a swap of the church property for a piece of land down the street so that the agency could build a center for screening vehicles. In exchange, the agency would give the church millions of dollars to build a bigger church.

The church says the two sides had mostly agreed on the terms when the Port Authority abruptly pulled out of talks in 2009. The Port Authority claims the church was demanding too much money.

"After eight months of negotiations in which the demands of the Orthodox Church continued to increase over and above what was originally agreed to in 2008, the Port Authority had to make a practical decision to move on or risk further delaying the entire World Trade Center project," the agency said in a written statement.

The Port Authority has said it offered $20 million of financing, plus as much as $40 million to cover extra costs related to the construction of a Port Authority parking lot under the church. It claims the church wanted a building six times bigger than its original one.

The church said that was only fair because it was giving up the valuable "air rights" over its original site. Air rights allow builders to put skyscrapers on small pieces of land.

In addition, about one-third of the new church would have been a memorial area for people of all faiths to gather, Arey said.

Recent leaders juice up Wall Street

NEW YORK (Reuters) – U.S. investors piled on a dizzying two-year advance in stocks on Thursday, using a brief slip on negative economic news as an opportunity to buy into market leaders.

The technology sector showed strength, with Nvidia Corp (NVDA.O) up 9.8 percent to $25.68 a day after posting a bullish revenue forecast on accelerating sales of its processors.

An index of semiconductors' shares (.SOX) gained 1.4 percent and is now up 21.3 percent since early December, around the time when the most recent leg of the run-up started.

The S&P energy sector (.GSPE) gained 0.8 percent. U.S. crude futures jumped 1.7 percent as unrest in the Middle East kept focus on supply, boosting shares of energy companies.

Futures had dipped early in the session after data showed both a rise in consumer prices and new claims for unemployment benefits, but the dip didn't last long after the open.

"People have been focusing on the positives like the outlook for corporations and a good earnings season," said Brian Lazorishak, a money manager at Chase Investment Counsel in Charlottesville, Virginia.

Stocks continued to ignore Iran's intention to send two navy vessels through the Suez Canal to the Mediterranean in a move Israel has called a "provocation".

"Geopolitical issues have been pushed aside, maybe prematurely," Lazorishak said.

The S&P 500 has doubled its value in less than two years, the quickest 100 percent gain since the Great Depression. However, volume has been light in the most recent leg of the rally, with just 6.7 billion shares changing hands Thursday on the New York Stock Exchange, NYSE Amex and Nasdaq combined -- the second-lowest so far in 2011.

The Dow Jones industrial average (.DJI) gained 29.97 points, or 0.24 percent, to 12,318.14. The Standard & Poor's 500 Index (.SPX) rose 4.11 points, or 0.31 percent, to 1,340.43. The Nasdaq Composite Index (.IXIC) added 6.02 points, or 0.21 percent, to 2,831.58.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 5 to 3, while on the Nasdaq, about three stocks rose for every two that fell.

The S&P 500 faces little technical resistance before the 1,361 area that marks the 76.4 percent retracement of its slide from the 2007 highs to the low hit on March 6, 2009.

A Fibonacci projection of the latest leg of the rally also draws a target near 1,361, suggesting the S&P could face strong resistance at that level.

Dr Pepper Snapple Group Inc (DPS.N) posted quarterly profit that beat estimates and gave an upbeat forecast and its shares jumped 5.7 percent to $36.20.

Its competitor Coca Cola Co (KO.N) was the top gainer in the Dow industrials, up 1.8 percent to $64.55. Coke also announced an increase in its dividend.

Data showed U.S. core consumer prices rose at the quickest pace in 15 months in January but economists said the turnaround in prices was unlikely to derail the Federal Reserve's plan to continue pumping money into the economy.

That excess liquidity has been one of the main drivers of the stocks rally in recent months.

A separate report showed factory activity in the U.S. Mid-Atlantic region rose in February to its highest since January 2004, with an employment subindex reaching its highest point since April 1973.

(Editing by James Dalgleish)

Rural access to intercity transportation declining

MINNEAPOLIS (Reuters) – Some 3.5 million rural residents lost access to scheduled public transit service to cities in the past five years due in part to cuts at Greyhound and Amtrak, a Transportation Department report released Wednesday said.

The report comes as the Congress debates funding for aviation services, including a proposal from Republican Senator John McCain to eliminate federal subsidies airlines receive to ensure passenger services to rural communities.

About 71.7 million rural residents, or 89 percent of the total, had access to air, bus, ferry or rail transportation to cities in September 2010, down from 93.3 percent in 2005, a Bureau of Transportation Statistics analysis showed.

The steepest drop in access came in southern states.

Some 700,000 rural Alabama residents lost scheduled transit service to urban centers in the past five years, dropping to 65 percent coverage, from 94 percent, the study found.

More than 400,000 rural Georgia residents lost any access and 272,000 rural Mississippi residents last options.

The most coverage in general was available in the Northeast where Rhode Island, Massachusetts and Connecticut all had a large percentage of rural residents covered by three or more modes of transportation, the study found.

Buses covered 78 percent of the total rural U.S. population in 2010, down from 89 percent in 2005, with route cuts particularly in southern states, central states and some Atlantic states, the report found.

Air service coverage was unchanged in the five-year period at 72 percent of rural residents, while rail service coverage slipped to 40 percent from 42 percent.

(Reporting by David Bailey; Editing by Jerry Norton)

Sanofi to buy Genzyme for over $20 billion

PARIS (Reuters) – French drugmaker Sanofi-Aventis SA agreed to buy Genzyme Corp with a sweetened $20.1 billion cash offer, plus payments tied to the success of the U.S. biotech group's drugs, the companies said on Wednesday.

The acquisition -- which comes nine months after Sanofi CEO Chris Viehbacher first put the idea to Genzyme's Henri Termeer -- is expected to boost Sanofi's earnings from the first year after completion by giving it a new platform in rare diseases.

Sanofi will pay $74 a share in cash and offer a tradable contingent value right, or CVR, whose value will depend on Genzyme's experimental multiple sclerosis drug Lemtrada and production of two other medicines.

The deal's announcement, which confirmed what sources with knowledge of the talks had told Reuters on Tuesday, marks the second-biggest acquisition in biotech history and will help Sanofi offset declining revenue from drugs that have lost, or are set to lose, patent protection.

Sanofi predicted the deal, which is expected to close early in the second quarter, would lift its underlying earnings by between 0.75 and 1.0 euro per share by 2013.

The CVR runs until the end of 2020 and entitles holders to a series of payments worth up to $14 per share in total, depending mainly on the success of Lemtrada.

In theory, that could add $3.8 billion to the price tag, but the market value of the CVR is expected to be deeply discounted given uncertainties about future Lemtrada sales, the long time horizon and the fact many investors will not want to hold such an instrument.

Tim Anderson, an analyst at Sanford Bernstein, said Sanofi would probably end up making payouts of no more than $4 per CVR, or around $1.1 billion, while Viehbacher told reporters that market estimates the CVR would trade at between $2 and $3 "may not be unrealistic." The CVR will be listed on Nasdaq.

"What we anticipate is that there will be a lot of sellers of that CVR, which is going to trade like an option," said Jean-Francois Comte, portfolio manager at Paris-based hedge fund Lutetia Capital. "So there might be another arbitrage opportunity on the CVR in the next few days."

VALUE BRIDGE

Shares in Sanofi rose 3.6 percent by 1525 GMT as investors welcomed the boost to earnings. Vincent Meunier, an analyst at Exane BNP Paribas, said the forecast of a 12 to 16 percent uplift to 2013 earnings was above his expectation of 10 percent, although the drugmaker gave no breakdown on synergies.

Genzyme was 1.5 percent higher at $75.46 in early trade.

The first $1 related to the CVR will be paid out if specified production levels are met in 2011 for Cerezyme and Fabrazyme -- two drugs for Gaucher and Fabry disease.

The bulk of the potential payments, however, are linked to Lemtrada and will kick in if that drug wins approval in multiple sclerosis and exceeds various sales milestones, which run up to $2.8 billion.

Sanofi thinks that number is unlikely to be hit but, if it were, it would be good news for shareholders in both companies.

"I told Henri, if we have to pay the last milestone I'll bring him the check personally and with his favorite wine to accompany that," Viehbacher said.

"I think the CVR was an extremely important tool to bridge differences in value."

The decision to buy Genzyme underscores large drugmakers' growing reliance on biotech to reinvigorate their pipelines. It follows AstraZeneca's acquisition of MedImmmune in 2007, Eli Lilly buying Imclone in 2008 and Roche's record buy of the rest of Genentech for $46.8 billion in 2009.

Genzyme, which posted a quarterly profit on Wednesday within its forecast range, said it would have to pay Sanofi a fee of $575 million if the deal was terminated.

Genzyme was the first company to show that money could be made by making drugs for diseases with small patient populations. In 2009 it generated revenue of $4.5 billion, enough to replace roughly a third of the sales Sanofi is expected to lose through 2013 to generic competition.

Viehbacher said rare diseases represented a huge unmet need, with around 6,000 to 7,000 such disorders in the world for which there are treatments for only about 10 percent. "It is a huge area of opportunity," he said.

Competition in the space is increasing but Viehbacher said Genzyme's position was extremely strong. "Genzyme is really the gold standard in patient-centric care and we believe the Genzyme brand will be able to protect that franchise," he said.

Wednesday's deal follows a lengthy stand-off between Viehbacher and Termeer, a Dutchman who has led the company for more than 25 years. He will resign and chairman and CEO of Genzyme when the transaction is completed.

Termeer was reluctant to sell the company that had come to define him, but a manufacturing crisis caused a shortage of key Genzyme drugs and by May last year the company's shares had fallen 46 percent from a high of close to $84 in July 2008.

Sanofi made its first formal offer of $69 a share in August.

Credit Suisse and Goldman Sachs advised Genzyme. Evercore Partners and JPMorgan were Sanofi's lead advisers.

(Additional reporting by Tim Hepher, with Ben Hirschler and Chris Vellacott in London; Editing by Hans Peters and Louise Heavens)