Updated from 11:49 a.m. EDTShares of Sallie Mae ( SLM) were among the NYSE's winners Monday, jumping 18.4% after the student loan lender agreed to be acquired by an investor group led by J.C. Flowers & Co. for about $25 billion, or $60 a share. The price represents a 28% premium to Sallie Mae's closing price of $46.76 on Friday. "We are pleased to invest in Sallie Mae and help provide increased liquidity, stability and financial strength," J.C. Flowers said. When the deal closes, J.C. Flowers and Friedman Fleischer & Lowe will invest about $4.4 billion and own 50.2% of the company. Bank of America and JPMorgan Chase, meanwhile, will each invest $2.2 billion and will each own 24.9% of the company. The acquisition is expected to close in late 2007. Shares of Sallie Mae closed up $8.59 to $55.35. Fremont General ( FMT) soared 26% after the mortgage lender agreed to sell about $2.9 billion of its subprime residential real estate loans to an unnamed buyer. The company has also entered into exclusive negotiations with the same buyer to sell most of its residential real estate business and assets. The $2.9 billion represents the bulk of Fremont's subprime residential loans held for sale that have not been sold yet. The sale is expected to result in a pretax loss of about $100 million. Shares were up $1.83 to $8.88.
Shares of W.W. Grainger ( GWW) rose 2.6% after the facilities maintenance company posted better-than-expected first-quarter results. The company earned $101.8 million, or $1.17 a share, on revenue of $1.55 billion. Analysts polled by Thomson First Call expected earnings of $1.09 a share on revenue of $1.53 billion. During the year-earlier quarter, the company earned $86.2 million, or 93 cents a share, on revenue of $1.42 billion. Looking ahead, W.W. Grainger now sees full-year earnings of $4.70 to $4.85 a share, up from $4.60 to $4.85 a share. Analysts project earnings of $4.74 a share. Shares were up $2.06 to $81.59. Eaton ( ETN) rose 2.8% after the industrial manufacturer reported better-than-expected first-quarter results. The company earned $234 million, or $1.56 a share, on revenue of $3.15 billion. Results included a tax gain of 7 cents a share. Analysts expected earnings of $1.41 a share on revenue of $3.04 billion. During the year-earlier quarter, the company earned $208 million, or $1.36 a share, on revenue of $3 billion. Looking ahead, Eaton now sees full-year operating earnings of $6.45 to $6.65 a share, up from an earlier forecast of $6.30 to $6.50 a share. Analysts project earnings of $6.22 a share. For the second quarter, the company sees operating earnings of $1.40 to $1.50 a share, up from its earlier projection of $1.35 to $1.40 a share. Analysts project earnings of $1.42 a share. Shares were up $2.34 to $87.50.
Shares of Powell Industries ( POWL) slumped 13.1% after the company said that it found accounting errors at one of its divisions. The errors were discovered in the course of a financial review conducted by the division's new controller shortly after joining the company. The errors relate to inventories, accounts payable and work-in-process items. The company said the errors would reduce earnings by about $2.5 million, or 22 cents a share. "While we believe these errors were the result of mistakes, all appropriate measures and reviews are being taken to correct this situation," the company said. Shares were down $4.83 to $32.16. NYSE volume leaders included Citigroup ( C), up $1.33 to $52.93; Ford ( F), up 1 cent at $8.03; First Marblehead ( FMD), down $9.83 to $34.60; Washington Mutual ( WM), up $1.31 to $40.73; General Electric ( GE), down 2 cents to $35.36; and Boston Scientific ( BSX), up 99 cents to $16. Nasdaq volume leaders included Sun Microsystems ( SUNW), up 6 cents to $5.86; Cisco Systems ( CSCO), down 6 cents to $26.62; Intel ( INTC), up 23 cents to $20.69; Amgen ( AMGN), up 62 cents to $59.65; Oracle ( ORCL), up 27 cents to $18.90; Sirius Satellite Radio ( SIRI), down 4 cents at $3.04; Apple ( AAPL), up $1.19 to $91.43; and Microsoft ( MSFT), up 12 cents to $28.73.