AVIATION

Delta Rejects US Airways Merger

ATLANTA — Delta Air Lines filed a reorganization plan yesterday that calls for it to emerge from bankruptcy next spring as a stand-alone company worth as much as $12 billion, or slightly more than the combined market value of the nation’s two biggest carriers. The Atlanta-based company also said that its board has formally rejected US Airways’ $8.5 billion hostile takeover bid, and its executives joined rank-and-file employees on a full-scale public relations assault against the proposal. US Airways said it will continue to fight for its proposal.

— Associated Press

BANKING

Morgan Stanley To Spin Off Discover Unit

Morgan Stanley, the world’s secondlargest securities firm, said fourthquarter profit rose 26% on a rally in stocks and bonds, and it revived plans to spin off the Discover credit card unit to shareholders. Net income for the three months ended November 30 increased to $2.21 billion, or $2.08 a share, from profit from continuing operations of $1.75 billion, or $1.64, a year earlier, the New York-based firm said in a statement yesterday.

— Bloomberg News

ENTERTAINMENT

Sony BMG To Pay $1.5M To Settle Anti-Piracy Suits

LOS ANGELES — Sony BMG Music Entertainment will pay $1.5 million and kick in thousands more in customer refunds to settle lawsuits brought by California and Texas over music CDs that installed a hidden antipiracy program on consumers’ computers. Not only did the program itself open up a security hole on computers, but the method Sony BMG originally recommended for removing the software also damaged computers. The settlements, announced yesterday, cover lawsuits over CDs loaded with one of two types of copy-protection software, known as MediaMax or XCP. Under the terms of the separate settlements, each state will receive $750,000 in civil penalties and costs.

— Associated Press

Harrah’s Accepts $17.1B Buyout Offer

Harrah’s Entertainment Inc., the world’s largest casino company, accepted a $17.1 billion offer from Apollo Management LP and Texas Pacific Group in the fourth-biggest private-equity buyout ever. Harrah’s investors will get $90 a share in cash, the Las Vegas-based company said in a statement yesterday. Including the assumption of $10.7 billion in debt, the transaction is about $27.8 billion.

— Bloomberg News

ECONOMY

Produce Price Index Increase Biggest Since ’74

WASHINGTON — Wholesale prices, riding on surging car and gas costs, barreled ahead at the fastest rate in 32 years last month, while home construction climbed but permits tumbled again. The producer price index for finished goods soared by a seasonally adjusted 2% in November — the biggest increase since November 1974, the Labor Department said yesterday.

— Dow Jones Newswires