AUTOMOTIVE: GM delays plans for development

Detroit —- General Motors Corp. said Thursday that it will indefinitely halt a major overhaul of its full-size pickup trucks and sport utility vehicles as it grapples with plummeting sales of those products. GM spokesman Tom Wilkinson said the automaker instead will work on more modest updates and enhancements as it shifts resources toward higher-mileage vehicles. "We're delaying it —- at least until we have a better sense of where the market is going," he said. "There's now so much uncertainty of where the full-size truck market is going, primarily because of the increase in fuel prices." Elsewhere, GM said 18,657 of its hourly workers will leave the company by July 1 through buyout and early retirement offers.

Kerkorian boosts stake in Ford

Detroit —- Billionaire investor Kirk Kerkorian's Tracinda Corp. reported Thursday that it has increased its stake in Ford Motor Co. to 6.49 percent and remains willing to consider supporting the automaker's turnaround effort with additional capital. Tracinda now owns 140.8 million Ford shares, according to the investment company's filing with the Securities and Exchange Commission. It previously had disclosed a 5.5 percent stake.

DEALS

Icahn loses out at Biogen Idec

Cambridge, Mass. —- Carl Icahn lost his campaign to elect a slate of dissident nominees to Biogen Idec Inc.'s board on Thursday, an effort the activist investor hoped would eventually trigger a sale of the 30-year biotechnology firm. Despite shareholders' election of four company-backed nominees rather than Icahn's candidates, one of the billionaire's nominees said afterward that Biogen Idec's management had agreed to discuss ways of improving the company's prospects, including strengthening drug research and employee morale. "We have heard from major shareholders and employees who think that things can be done better at Biogen," said Alexander Denner, managing director of Icahn's investment firm, Icahn Partners.

Apria Healthcare to be taken private

Lake Forest, Calif. —- Blackstone Group is taking home health care service provider Apria Healthcare Group private in a deal it says is worth $1.6 billion. Apria says the deal with the investment firm will give its stockholders $21 in cash for each share. That is a third more than the shares were worth at their close Wednesday. Apria's board unanimously approved the deal, which awaits the OK from shareholders.

Suitor backs out of Huntsman deal

Salt Lake City —- Jon Huntsman Sr. on Thursday blasted a private equity group for backing out of a deal to buy his chemical company. Huntsman called partners of New York-based Apollo Management LP a disgrace and said their decision was one of the most unethical contract violations he's seen in a half-century of business. An Apollo affiliate owns Hexion Specialty Chemicals Inc., which agreed last year to acquire Huntsman Corp. for $6.5 billion. Hexion said Wednesday it no longer thinks it can complete the deal because Huntsman's finances have deteriorated. Jon Huntsman, the company's founder and chairman, promised to make Apollo pay if it doesn't complete the deal. "Our company will fight Apollo vigorously on all fronts," he said in a statement.

FINANCIAL

WaMu to trim 1,200 workers

Seattle —- Washington Mutual Corp. is cutting 1,200 jobs nationwide. The country's largest thrift, hit hard by turmoil in the mortgage and credit markets, said Thursday that some layoffs will be in its home-loan business.

Citigroup warns of more write-downs

New York —- Citigroup Inc.'s chief financial officer on Thursday warned that the nation's largest bank by assets would suffer more "substantial" write-downs on debt investments in the second quarter. CFO Gary Crittenden also said there will likely be more write-downs related to leveraged loans and bond insurers. Crittenden also said that Citi's second-quarter write-downs on structured debt products known as collateralized debt obligations, or CDOs, would be lower than in the first quarter. In the first quarter, Citigroup marked down the value of its CDOs by about $3 billion. All told, the bank wrote down more than $14 billion in the quarter.

BB&T plans to increase dividend

BB&T Corp. expects to increase its cash dividend this year and reiterated that capital levels "remain strong." BB&T has increased its dividend for 36 consecutive years, the Winston-Salem, N.C.-based lender said Thursday in a statement. The last came in August, when the company raised the payout to 46 cents a share from 42 cents. Provisions for credit losses related to the housing slump have surged, pushing BB&T's stock price to the lowest point in a decade. While Chief Executive John Allison has predicted that bad loans will continue to increase as home prices drop, he said in April that "these issues will be manageable."

HEALTH CARE

GAO: Medicare providers owe feds

Washington —- Thousands of hospitals, nursing homes and other Medicare health providers owe the federal government more than $2 billion in payroll and other back taxes. In some cases, they used the money to buy luxury cars, million-dollar homes and other personal items, congressional auditors say. A report by the Government Accountability Office, obtained Thursday by The Associated Press, examined roughly 436,000 providers who received government payments in 2006 for treating Medicare patients. It found that more than 27,000, or about 6 percent, owed the federal Treasury back taxes.

LEGAL

Judgment against drug maker cut

Montgomery —- A state judge upheld the fraud verdict that Alabama won against AstraZeneca Pharmaceuticals LP in a Medicaid drug-pricing suit but ruled Thursday the punitive damages were too high, trimming the total judgment to $160 million. The jury had ordered the company, the U.S. subsidiary of Britain's AstraZeneca PLC, to pay $40 million in compensatory damages and $175 million in punitive damages. But Circuit Judge Charles Price ruled that state law limits punitive damages to three times compensatory damages and cut the amount to $120 million. A spokeswoman for AstraZeneca said the company would appeal to the Alabama Supreme Court.

Tax shelter case nets guilty plea

Fort Lauderdale, Fla. —- A former UBS executive has pleaded guilty in a U.S. tax case that is part of a wide-ranging probe into whether the Swiss banking giant helped wealthy clients hide assets and evade taxes. Bradley Birkenfeld entered the plea of guilty to one count of conspiring to defraud the United States in federal court in Fort Lauderdale. The 43-year-old had previously pleaded not guilty to the charge but changed that plea Thursday and said he would offer assistance in the wider probe. The charge carries a potential five-year prison term and $250,000 in fines. Birkenfeld worked for UBS AG from 2001 to 2006. Prosecutors say he and others helped a California real estate magnate hide $200 million in assets in Switzerland and Liechtenstein, helping the developer evade $7.2 million in taxes.

REAL ESTATE

Mortgage rates at 9-month high

Washington —- Rates on 30-year mortgages kept surging this week, rising to the highest level in nearly nine months. Freddie Mac, the mortgage company, reported Thursday that 30-year fixed-rate mortgages averaged 6.42 percent this week, up from 6.32 percent last week. Rates on 15-year fixed-rate mortgages rose to 6.02 percent, up from 5.93 percent last week. The five-year adjustable-rate mortgage rose to 5.89 percent, up from 5.70 percent. The rate on a one-year adjustable-rate mortgage rose to 5.19 percent, compared with 5.09 percent.

Commercial property prices dip

U.S. commercial real estate prices fell 2.8 percent in April from a year earlier as higher borrowing costs constrained transactions, Moody's Investors Service said Thursday. The decline was the first year-over-year drop in the measure since 2000, the start of its data sample, the credit ratings service said. Apartment building prices fell 3.4 percent, the most of any sector measured. "It's a credit-constrained environment," said Connie Petruzziello, Moody's analyst and co-author of the report. "We have expected prices to go down, and finally now that's what we're seeing in the market."

Bush, Congress spar over housing

The Senate on Thursday debated legislation that might help prevent home foreclosures as the Bush administration said the effort would be vetoed. The measure includes a temporary program to offer government insurance to struggling homeowners, a new regulator for mortgage buyers Fannie Mae and Freddie Mac, and funding for counseling to help homeowners avoid foreclosure. Debate will continue today with a vote early next week.

TELECOM

Sprint wins delay on spectrum swap

The Federal Communications Commission on Thursday agreed to give Sprint Nextel Corp. more time to swap some wireless spectrum frequencies with public safety agencies. Sprint was facing a June 26 deadline to vacate channels that its Nextel wireless network uses in the 800-megahertz band. While the deadline was set three years ago, work on the swap has been bogged down by technical and operational problems, opening the possibility that Sprint could lose access to channels where it serves around 16 million Nextel customers. The Overland Park, Kan.-based company wasn't alone in its trouble, however. About 500 agencies asked the FCC to extend their deadlines, which the agency agreed to do.

TRANSPORTATION

Trans-Atlantic carrier launched

British Airways is betting that, even in a down economy, wealthy travelers are still willing to pay for luxury on a trans-Atlantic flight. The airline's new premium affiliate, OpenSkies, made its first flight Thursday, a jaunt from Paris to New York aboard a Boeing 757 with only 82 roomy, leather-clad seats. OpenSkies is promising to pamper passengers with good food, chairs that fold into beds and other perks that will justify round-trip prices ranging from about $1,320 to about $3,800 per ticket on its New York/Paris route (restricted fares, with tax). "When you walk on the airplane, it's such a different feeling. You feel like you're on a large corporate jet," said OpenSkies Managing Director Dale Moss.

UTILITIES / ENERGY

Miles driven decline for April

Washington —- With gas prices holding at record levels above $4 a gallon, Americans are driving less and abandoning gas-guzzling vehicles, according to new government data. Americans drove 1.4 billion fewer highway miles in April compared with the same month last year, and 400 million fewer miles than they did in March, according to the Transportation Department. Sales of midsize sport utility vehicles were down 38 percent year-over-year in May, the department said. With Americans driving less and opting for more fuel-efficient vehicles, gasoline demand will likely decline in 2008 for the first time in 17 years, energy consulting firm Cambridge Energy Research Associates said Thursday.

WORKPLACE

Ruling strengthens age bias claims

Washington —- The Supreme Court made it easier Thursday for employees to prove they have suffered discrimination because of their age. In a 7-1 ruling, the court said that when older workers are disproportionately affected by an employment decision, the employer bears the burden of explaining whether there was a reasonable explanation other than age for the company's action. The case involves workers over 40 who challenged their dismissals from jobs at the Knolls Atomic Power Laboratory in upstate New York. Thirty of the 31 workers laid off by the lab in 1996 were over 40. Twenty-six of those employees sued Knolls, claiming that the layoffs violated the federal Age Discrimination in Employment Act.

Insurers lose case at high court

Washington —- The Supreme Court said Thursday that courts should consider an insurance company's potential conflict of interest when reviewing the denial of an employee's health or disability benefits claim. The court ruled 6-3 in the case of an Ohio woman who sued MetLife Inc. over a disability claim. She contended insurance companies have a financial incentive to deny claims and that conflict of interest should weigh heavily in employees' favor when they challenge benefit claims in court. A federal appeals court ordered Wanda Glenn's benefits reinstated. The Supreme Court upheld that ruling. Writing for the majority, Justice Stephen Breyer said federal law imposes a special standard of care on insurers, requiring full and fair review of claim denials.