U The planned $25 billion buyout of student lender Sallie Mae was thrown into jeopardy after an investor group led by private-equity firm J.C. Flowers & Co. said the $60-a-share terms of the deal were no longer acceptable because of pending legislation reducing government support for student loans. Reston-based Sallie Mae, officially SLM Corp., vowed to pursue all legal remedies.
U Topps Meat Co. recalled 331,582 pounds of frozen ground-beef products that may be contaminated with potentially deadly E. coli bacteria after federal investigators probed a “cluster of illnesses” in the Northeast. At least 21 persons in eight states, including Pennsylvania, New York and New Jersey, may have been sickened.
U Chicken jerky dog treats may have sickened dozens of dogs, the Food and Drug Administration warned, despite failing to find any trace of contamination. The agency said it has fielded more than 70 complaints, involving more than 95 dogs, from owners who think their animals fell sick after eating the products.
U Homeowners who have part of their debt forgiven by lenders to avoid foreclosure won’t get stuck with a tax bill under legislation approved by the House’s tax-writing Ways and Means Committee. Under current law, debt that is forgiven is treated as income and subject to tax.
U Washington Mutual Inc. reached a deal with bankrupt First Magnus Financial Corp. that will allow it to keep more than $1 billion in mortgage loans that it bought from the failed mortgage lender. In return, Seattle-based Washington Mutual agreed to drop a disputed claim on a separate pool of $3.15 million in First Magnus mortgages.
U Struggling home builder KB Home said it’s counting on Mickey Mouse and friends to help boost sales of new homes. The builder inked a licensing deal with Walt Disney Co. to offer home-design features, including flooring, lighting and wall coverings, based on Disney’s most popular characters.
U Credit Suisse Group said it will lay off 150 employees, mainly from its mortgage-backed securities unit, as a result of market turmoil caused by the U.S. subprime-mortgage crisis. An estimated 50,000 positions have been cut so far this year in the mortgage industry.
U The Securities and Exchange Commission is conducting more than 30 investigations into potential hedge fund manager misconduct in the Northeast U.S. alone, with more in other parts of the country, officials said. The investigations focus on potential insider trading, faulty asset valuation, conflicts of interest and other misdeeds.
U The Securities and Exchange Commission claims a hedge fund manager based near San Francisco bilked investors by spending their money on himself and his family while issuing account statements that drastically inflated the fund’s results. The lawsuit claims Alexander James Trabulse, 60, attracted about 100 investors to his Fahey Fund by claiming to have earned spectacular returns.
U Commercial airlines oppose a government recommendation that the industry set time limits for removing passengers from delayed aircraft. The Transportation Department’s inspector general recommends all airlines set a time limit for deplaning passengers, but the Air Transport Association argued that imposing such deadlines would do more harm than good.
U President Bush threatened to veto a House bill that would expand a federal flood insurance program to include coverage for wind damage, a proposal that would reduce the role of private insurers in coastal areas. Expanding the coverage offered by the National Flood Insurance Program would encourage development in storm-prone regions, the administration said.
U The owner of 134 Wendy’s restaurants wants to make a bid for the nation’s No. 3 hamburger chain with two private-equity firms. David Karam, president of Cedar Enterprises Inc., said that he and his partners have been invited by Wendy’s International Inc. to a second round of talks.
U The Internet Media Entertainment & Gaming Association argued in federal court that a new law against transmitting online bets outside the U.S. violates people’s right to gamble in the privacy of their own homes. The group’s attorneys said that, because filtering technology already exists to make sure children and compulsive gamblers cannot access offshore betting sites, the Unlawful Internet Gambling Enforcement Act serves only to stifle gambling companies.
U China announced rewards of $13,000 or more for citizens who snitch on copyright violators, the Xinhua news agency said, citing the National Copyright Administration. The agency said it set up a hot line and e-mail address for citizens to send tips.
U Former bidding rivals Nasdaq and Borse Dubai said they raised their offer for Sweden’s OMX exchange by 15 percent to $4.9 billion and entered agreements with key shareholders to secure nearly half of OMX shares. The exchanges also took steps to make it harder for Qatar Investment Authority, a major shareholder, to block the takeover.
U Warner Bros. Entertainment will develop a theme park and hotel in the Persian Gulf emirate of Abu Dhabi as part of a multibillion-dollar alliance. The deal with real estate developer Aldar and the newly formed Abu Dhabi Media Co. also involves jointly owned movie theaters in the United Arab Emirates and a separate deal to produce Arabic-language movies.
U Russia introduced its regional “super jet,” a government-backed effort to re-energize the country’s ailing aviation industry and get into a market now dominated by Bombardier and Embraer. The 95-seat Superjet-100 was rolled out at the Sukhoi factory in the Far East city of Komsomlsk-on-Amur.
U Shares of Northern Rock PLC, one of Britain’s largest mortgage lenders jumped 11.5 percent on word that it is in preliminary takeover talks with a number of potential buyers. Analysts have largely dismissed the chances of a larger bank making a rescue bid for Northern Rock, suggesting that a private-equity takeover — and subsequent breakup — is the most likely option.
U India‘s central bank relaxed rules that limited overseas investment by local companies, mutual funds and individuals in a bid to tame the rupee‘s surge. The Indian currency continued to rise and closed at a new nine-year high of 39.70 per U.S. dollar. Meanwhile, Indian share prices rose slightly to a sixth straight record close amid optimism about economic growth.
U Bristow Group Inc., which provides helicopter-transport services to offshore oil drillers, settled a case in which regulators accused the company of making bribes to officials in Nigeria. The Securities and Exchange Commission said that Bristow neither admitted nor denied the charges, and paid no penalty, but agreed to stop violating federal anti-bribery laws.
From wire dispatches and staff reports