Third-quarter growth swifter than estimated

The U.S. economy grew at an even faster pace in the third quarter than originally estimated, reflecting upward revisions to business investment and government spending.

Gross domestic product rose at an upwardly revised 5.2% annualized pace in the third quarter, the fastest in nearly two years. Consumer spending advanced at a less-robust 3.6% rate, according to the government’s second estimate of the figures issued Wednesday.

The downward revision to household outlays reflected slower growth in services spending. After a previously reported decline, business investment was revised up to a gain on the back of firmer outlays for structures. Housing was also stronger than initially reported.

The government’s other main gauge of economic activity gross domestic income rose a more moderate 1.5%. GDI is a measure of the income generated and costs incurred from producing goods and services.

The average of the two growth measures was 3.3%, more than double the average pace of the first half of the year.

Blackstone buys pet care company Rover

Rover Group, an online marketplace in the fast-growing market for pet-care services, soared after agreeing to be acquired by Blackstone Inc. in a $2.3 billion all-cash deal, the companies said Wednesday.

The pet economy exploded during the pandemic as locked-down Americans adopted cats, dogs and other animals. But now, with stubborn inflation for basic goods including those in the pet category, many owners are finding it increasingly expensive to care for their animals. NIQ data from October shows that pet-care retail prices were up about 6% from last year, higher than overall inflation rates.

Blackstone is paying $11 a share for the dog-walking and pet-sitting company, a premium of about 61% to its average price in the 90 trading days ended Tuesday. The parties expect the deal to close in the first quarter of 2024.

Seattle-based Rover went public through a merger with Nebula Caravel Acquisition Corp., a special-purpose acquisition company sponsored by San Francisco-based True Wind Capital, in August 2021. Valued at about $1.35 billion, Rover was among a flood of companies to list through the so-called de-SPAC process at a time when venture capitalists and hedge funds sought quick returns amid low interest rates.

Berkshire claims plot to raise Pilot’s profits

Warren Buffett’s Berkshire Hathaway Inc. said the billionaire former owner of Pilot Travel Centers sought to influence Pilot executives’ business decisions in order to juice the company’s quarterly earnings and pump up the value of his remaining stake in the truck stop chain.

In a court filing Tuesday, Berkshire alleges that Jimmy Haslam, whose family owned Pilot until selling it a controlling stake, launched an “illicit scheme” involving secret pledges of bonuses to 15 senior executives and other managers. He promised millions of dollars in “side payments” to the executives to boost short-term profit at the expense of its long-term value, according to the filing in Delaware Chancery Court. The alleged aim was to raise the value of his 20% stake in the chain.

Berkshire claims that after it took control of Pilot in January, Haslam “secretly promised massive side payments, from his own pocket,” to get the executives to focus on 2023 profit, which determines the payout Pilot would get on selling its minority stake to Berkshire early next year. He proceeded “in an insidious and largely undetectable way,” Berkshire alleges.

Lawyers for Haslam, the owner of the National Football League’s Cleveland Browns, didn’t immediately respond to a request for comment on the filing. A Pilot spokesperson declined to comment. Haslam is still Pilot’s chairman.

Compiled from Bloomberg reports.