BUSINESS BRIEFS
Fannie Mae again being scrutinized
Associated Press
WASHINGTON — Fannie Mae's bookkeeping is drawing scrutiny from Wall Street — again.
Three years after a stunning accounting scandal that forced it to restate earnings by $6.3 billion, the government-backed home-loan finance company now is on the defensive over a change in how it calculates potential losses from the growing mortgage crisis.
The fear among investors is that a new accounting methodology masks the number of bad loans held by Fannie, thus downplaying potential losses.
WIRELESS CARRIER ALLTEL NOW PRIVATE
LITTLE ROCK, Ark. — Alltel Corp., the nation's fifth-largest wireless carrier, was taken private yesterday to complete a $24.7 billion buyout by two private equity groups.
The deal earlier won approval of shareholders and was cleared by the Federal Communications Commission.
There are concerns that the debt burden that Alltel will carry to finance the buyout — $23 billion — will limit its ability to grow, however.
The Little Rock-based company said in an earlier filing that it intends to take part in a Jan. 24 auction of the wireless spectrum, which is to provide room for companies to expand their offerings.
The filing notes that there is no guarantee that Alltel will be a successful bidder.
ARABS INVEST IN U.S. CHIP MAKER
SAN FRANCISCO — With oil prices surging and U.S. stock prices slumping, chip maker Advanced Micro Devices Inc.'s sale of an 8.1 percent stake to the Abu Dhabi government's investment arm represents the latest plunge by a wealthy Middle Eastern nation into a troubled U.S. corporation.
It also raises fresh questions about the appropriateness of Middle Eastern firms owning large chunks of U.S. businesses that specialize in advanced technologies.
Sunnyvale-based AMD, the world's No. 2 microprocessor maker, needs the $622 million investment from the Mubadala Development Company to help lift the company out of a deep financial slump.
DELPHI FINANCING PLAN APPROVED
NEW YORK — A judge yesterday approved a $6.8 billion financing plan for Delphi Corp.'s exit from bankruptcy.
But the judge also admonished potential equity investors who he said had drained away hundreds of millions of dollars as the auto parts supplier disclosed new terms earlier this week for investing in the firm.
Delphi, which is based in Troy, Mich., had originally sought $8.7 billion in loans but had reduced that amount and delayed voting on its reorganization plan as it struggled to secure the financing in a tighter credit market.
FEDEX REDUCES EARNINGS FORECAST
NASHVILLE, Tenn. — FedEx Corp. reduced its quarterly and yearly earnings expectations yesterday, and analysts suggested that forecasts could be pared for future periods if fuel prices don't stabilize.
The Memphis-based shipper blamed soaring fuel costs and a troubled U.S. freight market for the reduced estimate that led the company's shares to plunge 4.5 percent and set a 52-week low yesterday.
OPEC DISCUSSES WEAKENING DOLLAR
RIYADH, Saudi Arabia — The accidental airing of a closed OPEC session yesterday provided a surprise glimpse into a sensitive debate over the weakening U.S. dollar, with Saudi Arabia's foreign minister warning that even talking publicly about the currency's decline could further hurt its value.
The high-profile blunder ahead of a rare OPEC summit showed the debate as Iran attempted to convince other member countries to express concern over dollar depreciation in the meeting's final declaration.
