Business Briefing, July 23

Rocky staff and wire reports

Published July 22, 2008 at 9:05 p.m.

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Heather Catlow

Amy Falconetti

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NATIONAL

Fannie and Freddie rescue tab could be as high as $25 billion

A federal rescue of troubled mortgage giants Fannie Mae and Freddie Mac could cost taxpayers as much as $25 billion, Congress' top budget analyst said Tuesday.

But Peter R. Orszag, director of the Congressional Budget Office, predicted in a letter to lawmakers that there's a better than 50 percent chance the government will not have to step in to prop up the companies by lending them money or buying stock.

Congress is expected to vote this week on a housing measure that would give the Treasury Department authority to throw the two a temporary lifeline.

SARA LEE LABELS Food company Sara Lee Corp. has agreed to clarify labels showing the amount of whole grain contained in its Soft & Smooth bread.

The Downers Grove, Ill.-based company and food-labeling advocacy group, Center for Science in Public Interest, reached an agreement on the labels Monday.

The advocacy group claimed that Sara Lee's label on the Soft & Smooth bread was misleading because the product is made mostly from refined white flour.

JOINT VENTURE General Electric Co. has agreed to a joint venture with an Abu Dhabi government investment company that will pump $4 billion of outside capital into its weakened commercial finance business.

The venture is part of new global partnership to expand on GE's fast-growing sales in the Middle East.

The deal with Mubadala Development Co. will also launch or broaden several other ventures with the Persian Gulf investment vehicle.

Mubadala expects to become one of the top 10 institutional investors in GE.

H&R BLOCK CEO H&R Block Inc., the nation's largest tax preparer, on Tuesday named the former president of McDonald's Europe as its new chief executive.

Russ Smyth will take over as the Kansas City-based company's president and CEO on Aug. 1.

He replaces Alan Bennett, appointed interim CEO in November.

YAHOO PROFIT SLIPS Yahoo Inc.'s profit slipped again in the second quarter, a recurring theme that has frustrated shareholders and raised doubts about the Internet company's future.

While the results released Tuesday missed analyst expectations, the performance wasn't as bad as many investors feared after Internet search and advertising leader Google Inc. disappointed Wall Street with its second-quarter earnings last week.

LOCAL

Indonesia orders Newmont Mining to drop plan to sell stake

PT Newmont Nusa Tenggara, the Indonesian unit of Denver-based Newmont Mining Corp., has been ordered to drop its plan to sell a stake of as much as 49 percent through an initial public offering, Indonesia's investment agency said.

The proposed sale violates Newmont's 1986 mining contract with the government, Indonesia's Investment Coordinating Board said. Newmont has yet to meet an obligation to divest a 17 percent stake in Newmont Nusa Tenggara.

LOCKHEED EARNINGS UP Lockheed Martin Corp. posted a 13 percent increase in second-quarter earnings Tuesday, beating Wall Street expectations and prompting the company to raise its yearly outlook as it made up a drop in fighter jet sales with strength in its other business units.

Shares of Lockheed, the nation's largest defense contractor, rose $2.29, or 2.3 percent, to close at $103.88.

CHAMBER OFFICERS Qwest Colorado President Chuck Ward has been selected chair-elect of the Denver Metro Chamber of Commerce for the 2009-2010 term.

Madeleine "Mimi" Roberson, CEO of HealthONE-Presbyterian/St. Luke's Medical Center, takes over chairwoman duties this fall.

HOTEL OCCUPANCY DOWN Average room rates rose and occupancy rates dropped for Denver-area hotels in June, according to the Rocky Mountain Lodging Report released Tuesday.

ECONOMY

U.S. home prices fell 4.8 percent over year

A government report says U.S. home prices fell 4.8 percent in May from the same month last year.

The Office of Federal Housing Enterprise Oversight also says prices, on a seasonally adjusted basis, fell 0.3 percent from April to May. The index is down almost 5 percent from its peak in April of last year.

OFHEO oversees the government-sponsored mortgage finance companies Fannie Mae and Freddie Mac.

The index is calculated using mortgage loans of $417,000 or less.

THIS JUST IN...

* The U.S. Bank Small Business Banking team in Denver promoted Jeff Jones to vice president and client manager.

* Boys & Girls Clubs of Metro Denver appointed John Arigoni as president and CEO.

* The Colorado Rural Health Center was awarded the State Offices of Rural Health grant from the Health Resources and Services Administration.

* The American Lawyer's Pro Bono Scorecard named Holland & Hart LLP among America's top pro bono law firms.

* Donor Alliance named Jennifer Prinz chief operating officer.

* Merrily Archer joined Fisher & Phillips' Denver office as of counsel.

* Delta Disaster Services moved its office to 5535 W. 56th Ave. in Arvada.

* Balfour Retirement Community named Heather Catlow as director of life enrichment and Matthew Karm as assistant director of life enrichment.

* Denver-based Amelie Co. won the Gold and Platinum categories at the 2008 international Hermes Awards.

* K.J. McCorry launched a sustainability consulting firm, eco-officiency LLC, in Boulder.

* Denver's Hotel Teatro was selected as one of the top 100 hotels in the United States and Canada in Travel & Leisure magazine's World's Best Awards.

* Denver Academy hired Kevin Smith as headmaster.

* Sharon Linhart of Linhart PR was named one of three Volunteer Partners of the Year by the Downtown Denver Partnership.

* Christopher Watts joined the Denver office of Grant Thornton LLP as a tax manager.

* Eric McClure joined Short Elliott Hendrickson Inc.'s Denver office as a project manager in the Aviation Group.

* Denver-based Bill Billings was promoted to regional director of operations for Maggiano's Little Italy.

* Five Guys Burgers and Fries opened its first Colorado store at 1335 W. Elizabeth St. in Fort Collins.

* Mark and Debra Witte, of Colorado Springs, earned the Franchisee of the Year Award from DreamMaker Bath & Kitchen.

* MentorNet appointed David Porush as president and CEO.

* The Community College of Aurora's Emergency Medical Provider Program received gifts of two used ambulances, one from Peak Motor Coach Ltd. of Denver and one from Stadium Medical of Arvada.

* Evergreen-based Ades Design Builders won the Judges Overall Choice Award in the 2008 Parade of Homes competition.

* Mile High United Way awarded Judy Ham its Anna Jo Haynes Caring About Kids Award.

* The Credit Union Associations of Colorado and Wyoming hired Amy Falconetti as staff accountant.

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