Stocks rise on earnings news, Sallie Mae bid

TRADERS WORK on the floor of the New York Stock Exchange last week. /
TRADERS WORK on the floor of the New York Stock Exchange last week. /

NEW YORK – U.S. stocks rose this morning on news that student-loan provider Sallie Mae (SLM Corp.) has accepted a $25 billion bid from a group lead by private-equity firm JC Flowers & Co., according to Bloomberg News, and rosy corporate earnings reports added to the morning’s gains.
The offer’s $60 per share represented a 28-percent premium above Sallie Mae’s closing price last week. SLM shares rose $8.24 or 18 percent to $55, Bloomberg said. Under the deal, Flowers and Friedman Fleischer & Lowe LLC would share 50.2 percent of the company, and JPMorgan Chase & Co. and Bank of America Corp. would each get 24.9 percent.
Shares of Citigroup Inc., Wachovia Corp., Eli Lilly & Co. and Mattel Inc. all rose after the companies posted higher-than-expected earnings. Citigroup rose 66 cents to $52.26; Wachovia rose $1.19 to $55.19; Lilly gained $1.11 to $57.99; and Mattel rose 31 cents to $28.65.
At 10:33 a.m., the Standard & Poor’s 500 Index was up 9.34 points or 0.6 percent to 1,462.19, its highest level since September 2000, Bloomberg said. The Dow Jones Industrial Average rose 69.32 points or 0.6 percent to 12,681.45, and the Nasdaq Composite Index rose 14.71 points or 0.6 percent to 2,506.65.

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