- The Washington Times - Thursday, April 17, 2008


• Reston student lender Sallie Mae lost $104 million in the first quarter and fell short of expectations amid a severe disruption in the student lending industry. The company said it lost 28 cents a share in the first quarter, compared with a profit of $116 million (26 cents) a year earlier. Sallie Mae set aside $137 million for losses on student loans.

Sprint Nextel Corp., the third-largest U.S. mobile-phone provider, must face trial in a lawsuit accusing the company of overcharging data customers for certain taxes and refusing to issue refunds, a federal judge in San Diego ruled. The advocacy group Utility Consumers’ Action Network may sue because many of its 30,000 members lost money as a result of Sprint’s practices, he ruled.

• Arlington power generator AES Corp. said it completed the $930 million purchase and transfer of assets of the 660-megawatt Masinloc coal-fired thermal power plant located in Luzon, Philippines. “This acquisition … offers AES an excellent entry point into the growing Philippine economy through the lowest-cost thermal plant in the system,” Chief Executive Officer Paul Hanrahan said.


• Without enough takers of buyout offers, the New York Times will likely resort to layoffs to meet its goal of cutting 100 newsroom jobs. Bill Schmidt, an assistant managing editor, sent a staff memo saying the Times is “almost certain” to fall short of getting enough volunteers for buyouts, resulting in “some limited number” of layoffs in the newsroom.

• The Wall Street Journal began publishing its U.S. edition in London yesterday, making the newspaper available five hours ahead of the title in the United States. Publisher Dow Jones & Co. says the paper will be available via subscription and at an estimated 250 newsstands in the British capital, including at Heathrow and London City airports.

• Former General Electric Co. Chief Executive Officer Jack Welch said he would “get a gun out and shoot” his successor, Jeffrey R. Immelt, if he allowed GE to miss earnings targets again. “I’d be shocked beyond belief and I’d get a gun out and shoot him if he doesn’t make what he promised now,” Mr. Welch said on CNBC, a cable station owned by GE. “Jeff has a credibility issue,” he added.

• Drug maker Eli Lilly plans to cut up to 500 jobs to streamline the manufacturing of some insulin products and the osteoporosis drug Forteo. The Indianapolis-based company offered a “voluntary exit program” to about 2,000 employees in central Indiana with a goal of trimming its work force by up to 500 people.

• Five executives at health care financial firm National Century Financial Enterprises, convicted in a $1.9 billion corporate fraud, had planned to flee the country on a cruise ship because they wouldn’t need passports and could vanish once overseas, an FBI agent testified. A jailhouse informant said the disappearance of one executive “put a kink” in the reputed plot, Special Agent Kevin Horan said.

General Motors Corp. is organizing its eight brands into four divisions in order to streamline product development and sales and further differentiate the brands, the automaker said. The Chevrolet and Saturn brands will continue to stand alone, but there will be a new premium division containing Cadillac, Hummer and Saab, and another division for Buick, Pontiac and GMC. GM hired former Nissan executive Mark McNabb to steer sales of the premium division.

• Shares of CIT Group Inc., the biggest independent U.S. commercial lender, rose 7 percent amid speculation the company managed to soften the impact of a cash squeeze on its earnings. CIT shares advanced 78 cents to $11.78. The stock lost more than half its value this year. CIT reports results today.

Bank of America accused American Home Mortgage Investment of delaying the sale of 3,400 mortgage loans while they lost an estimated $216.6 million in value. Homeowners owe $570 million on the loans, the bank told a bankruptcy judge in a hearing to decide what to do with the mortgages.

Fidelity Investments said shareholders voted down a proposal recommending that four of its mutual funds stop investing in companies contributing to genocide, including PetroChina Co., the oil producer whose parent company does business with the government of Sudan.

FBI Director Robert S. Mueller III described a “tremendous surge” in mortgage fraud investigations that he said has diverted agents from other cases and is expected to expand. At a Senate hearing, Mr. Mueller said the FBI is investigating an estimated 1,300 mortgage fraud cases — including 19 into subprime lending practices by U.S. financial institutions.

• Reacting to the economic slowdown, J.C. Penney Co. will open fewer new stores this year than originally planned while stepping up efforts to attract frugal shoppers away from rivals through new brands and marketing pitches. Penney officials said at the annual investors’ meeting that the company plans to open 36 new stores this year instead of the 50 it had projected.


• Human rights groups launched a global campaign targeting corporate sponsors of the Beijing Olympics, urging them to pressure Chinese leaders to end abuses. “We want the corporations to adopt our principles of human rights,” said the head of Reporters Without Borders’ Americas desk, Benoit Hervieu, as about 30 protesters gathered outside the Coca Cola shareholders’ meeting in Wilmington, Del.

Iraqi Prime Minister Nouri al-Maliki gave notice to the European Union that his nation is open for business, despite its fighting with al Qaeda in Iraq and Shi’ite militias. Mr. al-Maliki said that in return for opening its vast oil and gas reserves to investors, Iraq wants EU know-how to rebuild its tattered institutions and industrial base.

From wire dispatches and staff reports

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