Briefs

TIME WARNER SETS ASIDE $3 BIL.

Time Warner Inc., the world's largest media company, is settingaside $3 billion in reserves to settle shareholder lawsuits filedagainst the company in the wake of its disastrous merger with AOL.Time Warner said it had reached a tentative settlement with the leadgroup of shareholder plaintiffs, who claimed they were cheated inthe merger by inflated revenue claims and improper accounting atAOL. The announcement came as Time Warner released its second-quarter earnings report. For the three months ending in June, thecompany posted a net loss of $321 million, or 7 cents a share,versus a profit of $777 million in the year-ago period.

AON EARNINGS LAUNCH SHARES

Shares of Chicago-based Aon Corp. soared today after the world'ssecond-biggest insurance broker blew by analysts' expectations forsecond-quarter profits. The strong performance indicates Aon mayquickly recover from New York Attorney General Eliot Spitzer's fraudinvestigation. Aon on Monday reported net income rose 10 percent to$191 million, or 57 cents a share, topping analysts' consensusestimate of 48 cents a share. Shares rose $4.32 to $29.88.

P&G BORROWS $24 BILLION

Procter & Gamble Co. is taking a $24 billion loan, the largest bya U.S. company in five years, to buy back its own shares and thoseof Gillette Co. Citigroup Inc. is leading banks arranging thecredit, according to a filing with the Securities and ExchangeCommission. The loan is the biggest in the U.S. since AT&T Corp.borrowed $25 billion in 2000.

SERVICE SECTOR SLOWS

Activity in the service economy grew at a slower pace in Julythan in the previous month as companies were hit hard with big priceincreases amid higher energy costs, a private research group saidtoday. The index of business activity in the non-manufacturingsector slipped to 60.5 last month from 62.2 in June, the Institutefor Supply Management reported. June marked the 28th consecutivemonth of expansion. A reading of 50 or above means the servicessector of the economy is expanding.

NORTHWEST FACES STRIKE THREAT

Talks broke off between Northwest Airlines Corp. and itsmechanics today, with mechanics saying the likelihood of a strikewas increasing. Mechanics can strike after 12:01 a.m. EDT on Aug. 20if no deal is reached.

Sony settles suit over ads

Sony Pictures Entertainment must pay $1.5 million to settle aclass-action lawsuit accusing the studio of citing a fake moviecritic in ads for several films. Moviegoers who saw the films"Vertical Limit," "A Knight's Tale," "The Animal," "Hollow Man" or"The Patriot" may be eligible for a $5 reimbursement.

GRAINS, BEANS DIP

Grain and soybean futures retreated today on the Chicago Board ofTrade. Wheat for September delivery fell 6 cents to $3.26 a bushel;September corn fell 5 1/2 cents to $2.27 a bushel; September oatsfell 3 cents to $1.58 a bushel; September soybeans fell 19 cents to$6.75 1/2 a bushel.