Business news in brief

A new HIV-fighting drug from Merck & Co. Inc. appears superior to options for patients who have stopped responding to available drugs, federal regulators said yesterday. The Food and Drug Administration said Merck's studies of Isentress showed the drug was safe and effective to treat HIV patients who had developed a resistance to other medications. Merck has major operations in the Philadelphia area. Roughly one million people in the United States are HIV-positive, according to the Centers for Disease Control and Prevention. Outside experts are scheduled to vote Wednesday on the drug's safety and effectiveness. The FDA is not required to follow the experts' recommendations, although it usually does.

- AP

Valero Energy Corp., the largest U.S. petroleum refiner, may sell plants in Aruba and as many as four states to tighten its focus on processing cheap grades of oil that yield the industry's widest profit margins. The most likely U.S. plants to be sold are in Paulsboro, N.J., Oklahoma, Louisiana and Tennessee, analysts said. Among the U.S. plants analysts peg as most likely to be sold by Valero, only the refinery in Paulsboro has a delayed coking unit, a device that converts heavy crude and residual oil into lighter products and petroleum coke. Cokers play a key role in Valero's overall strategy of increasing its capacity to refine cheap grades of heavy and sour crude.

- Bloomberg News

Boeing Corp. said it was "extremely disappointed" that the Government Accountability Office had sustained a protest of the U.S. Air Force's selection of its HH-47 Chinook helicopters built in Delaware County for search-and-rescue missions. The Air Force selected Boeing in November to build an anticipated 141 helicopters worth $15 billion. The protest, filed by rivals Lockheed Martin Systems Integration and Sikorsky Aircraft Co., focused on the way the Air Force sought to correct an earlier complaint that was sustained by the GAO. Responding to the GAO action Thursday, Boeing said in a statement that the Air Force had made a "good faith" effort in response to the earlier GAO ruling and that the company would await a response from the Air Force before deciding on its course of action.

- Henry J. Holcomb

Tyco Electronics Ltd., Berwyn, said it entered into an agreement with Bank of America allowing the company to extend the maturity date of a loan by 364 days. The one-year loan had been set to mature on April 23, 2008. The choice to extend it will be Tyco's, the company said in a filing with the Securities and Exchange Commission. Tyco has $2.7 billion outstanding under the loan. The company was formed on June 30 as a spin-off from Tyco International Inc., which split into three separate public companies.

- Paul Schweizer

A Lancaster company will pay $150,000 as part of its settlement for violating Nebraska environmental-protection laws. Nebraska Attorney General Jon Bruning said Armstrong Wood Products Inc. would pay $75,000 in fines to the state Common Schools Fund and $75,000 to the city of Auburn. Auburn will use the money to help build a nature trail. Nebraska Department of Environmental Quality inspectors say Armstrong failed to properly train its Auburn plant employees to monitor air quality, and failed to maintain records about air-quality-control activities and repairs. The state also says Armstrong failed to label discarded paint filters as hazardous waste and dispose of them correctly.

- AP

Accredited Home Lenders Holding Co. rejected a private-equity firm's attempt to lower its price to buy the subprime-mortgage lender, saying yesterday that it would continue a lawsuit aimed at closing the deal. Lone Star agreed in June to pay $15.10 a share, or $400 million, for Accredited. But late Thursday, Lone Star told the mortgage lender that it wanted to pay $8.50 a share. In exchange for the reduced price, Lone Star offered to let Accredited seek other buyers. But yesterday afternoon, Accredited said it had a deal two weeks ago, when 97 percent of the company's shares were tendered at $15.10 apiece. Accredited said it would continue pursuing a lawsuit it filed last month in a Delaware court to try to force the equity firm to complete the deal. Dallas-based Lone Star has been trying to back out of the transaction, arguing that there has been "drastic deterioration" in Accredited's financial and operating health. Accredited was active in the subprime-mortgage-lending business, and has run into financial trouble.

- AP

AT&T Inc. and Verizon Communications Inc. can each merge their local and long-distance telephone operations with fewer government restrictions than some rivals wanted, federal regulators said. The Federal Communications Commission agreed Thursday to exempt the two biggest U.S. phone companies from price caps and other so-called dominant-carrier rules on long-distance service. The FCC posted the order on its Web site. The decision gives AT&T and Verizon the same type of exemption that Qwest Communications International Inc. won in February. The carriers said the rules were outdated and would hinder their ability to compete with other long-distance, mobile and Internet-phone services. Comptel, a Washington-based trade group whose members include rivals of AT&T and Verizon, had urged the FCC not to lift the long-distance restrictions. The rules promote consumer choice and protect against price increases, the organization said in a July 2006 response to AT&T's request.

- Bloomberg News

Warren Buffett's investment company boosted its stake in the nation's railways last month, acquiring 845,000 shares of Burlington Northern Santa Fe Corp., according to a filing with the Securities and Exchange Commission. The purchase, filed late Thursday with the SEC, raised Berkshire Hathaway's stake in the Fort Worth, Texas, railroad to 15 percent, just short of 53 million shares.

- AP

U.S. newspaper advertising fell 8.6 percent to $11.3 billion in the second quarter, led by a 16 percent drop in classified sales, an industry trade group said. Print advertising dropped 10.2 percent to $10.5 billion, the Newspaper Association of America said in a statement. Online sales rose 19 percent to $796 million.

- Bloomberg News

New York City shoppers planning to hit the stores this Labor Day weekend will find a nice surprise at the cash register: a tax break on clothing and shoe purchases. Before today, shoppers paid no city or state sales tax on clothing and shoe purchases under $110. But a tax-relief measure proposed by Mayor Michael Bloomberg and signed into law in June eliminates the city's portion of sales tax on all of those purchases, no matter what the amount. The break takes effect today.

- AP