IN HAWAII

Starwood buys Kauai site for time-shares

Starwood Vacation Ownership Inc. is moving forward with its plans for a luxury time-share resort on Kauai's north shore, and is buying an 18.5-acre site from Princeville Corp.

The property, known as Lot 25, is on a section of the bluff that overlooks Anini Beach in Princeville. The resort will be located near the Princeville Hotel, which is owned by Princeville Corp. and managed by Starwood.

Several prospective buyers have looked at the property in the past few years, including Walt Disney Co. Kauai Planning Director Dee Crowell has said the site is zoned for up to 370 time-share units.

Princeville Corp. is owned by Japanese companies Suntory Ltd., Mitsui & Co. and Nippon Shinpan & Co.

Pacific Housing nabs $899,900 grant

Pacific Housing Assistance Corp., a Honolulu nonprofit development company, has been awarded an $899,900 affordable housing grant from Federal Home Loan Bank of Seattle to support the construction of a 156-unit complex in Iwilei for low-income elderly households.

The grant is the largest FHLB affordable grant ever sponsored by Bank of Hawaii, which has helped 17 local organizations receive nearly $6 million in FHLB funding for affordable housing projects during the past eight years.

The development, called the "Senior Residence at Iwilei," will be built at the historic Oahu Railway & Land Co. site. Construction is scheduled to begin in November and continue through the middle of 2004.

As the grant sponsor, Bank of Hawaii reviewed and submitted Pacific Housing's grant application and is facilitating the disbursement of funds.

Bank of Hawaii will monitor the project for 15 years once it is built to ensure that the rental units maintain their affordable housing status.

ON THE MAINLAND

Report: Cendant to buy bankrupt Budget

NEW YORK >> Cendant Corp. has agreed to buy Budget Group Inc. out of Chapter 11 bankruptcy for $107.5 million, a published report said.

In a story posted on its Web site early this morning, The Wall Street Journal, citing unidentified people familiar with deal, said New York-based Cendant also agreed to assume $2.7 billion in debt.

The paper said the deal is expected to be announced today.

Cendant, which owns car rental company Avis Holdings Inc., is also expected to cover nearly $100 million in operating liabilities Daytona Beach, Fla.-based Budget had before it filed for bankruptcy protection in July.

If the deal is approved, it would make Cendant's the nation's second-biggest car rental company behind Enterprise Rent-a-Car Co.

AOL to buy AT&T's stake in joint venture

New York >> AOL Time Warner Inc. agreed to pay AT&T Corp. $3.6 billion in cash and stock, plus ownership in cable-television systems, to dissolve their media joint venture and gain full control of assets such as the HBO TV network.

Comcast Corp., poised to acquire AT&T's cable business, will inherit the proceeds from the deal, including the 21 percent stake in a newly formed Time Warner Cable company. An initial public offering of Time Warner Cable may be held as early as next year, the companies said in a statement.

The dissolution of the venture bolsters Chief Executive Officer Richard Parsons' goal of simplifying AOL Time Warner's financial structure.

In other news ...

CHICAGO >> United Airlines' pilots union has shelved a vote on a proposed 10 percent pay cut as the troubled carrier pushes for even bigger cutbacks and cost savings in a bid to avoid bankruptcy.