GLENDALE, Calif. — IHOP Corp., best known for its blue-roofed pancake restaurants, said Monday it has agreed to buy the bar-and-grill chain Applebee's International Inc. for about $1.9 billion in cash.

The move comes as Wall Street analysts are expecting a difficult second-quarter earnings season in the restaurant sector as soaring commodity costs are hurting restaurant profits and consumers facing high gas prices are thinking twice about going out for a meal.

IHOP Chief Executive Julia Stewart, a former Applebee's executive, said once the deal closes, IHOP would revive the Applebee's brand and plans to turn it into primarily a franchisor by selling most of the 500 company-owned stores at a rate of 40 per quarter, a process that could take until 2010 to complete.

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GROUP PREPARES NEW BID FOR ABN

AMSTERDAM, Netherlands — A trio of banks led by Royal Bank of Scotland PLC said Monday it would rebid 71.1 billion euros ($97.8 billion) for ABN Amro Holding NV, as the group went on the offensive in the largest takeover battle in the history of the financial industry.

The proposed bid of 38.40 euros ($52.87) per share, mostly in cash, would be worth at least 10 percent more than an all-share rival bid by Barclays PLC, RBS and its partners said.

ABN Amro shares opened 3.4 percent higher at 37.08 euros ($51.05) in Amsterdam, closer to the RBS-group bid than the Barclays' bid. Barclays' shares gained 2.3 percent in London to 741 pence ($15.08) — at that level, its bid for ABN is worth 35.14 euros per share. RBS shares gained 1 percent to 646.5 pence ($13.16).

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LEAR SHAREHOLDERS REJECT ICAHN BID

WILMINGTON, Del. — Lear Corp. shareholders rejected a $2.9 billion buyout offer Monday from a firm led by billionaire investor Carl Icahn, mounting enough opposition amid concerns that the bid undervalued the auto supplier.

Icahn's American Real Estate Partners LP had improved its offer in the past week to $37.25 a share, but some shareholders said Lear was worth far more and questioned whether the deal was in their best interest.

Icahn, the company's largest shareholder with about 16 percent ownership, did not attend the meeting and it was unclear how he would proceed. Vincent Intrieri, senior managing director with Icahn Partners, said the firm respected the shareholders' decision.

Icahn's group still is entitled to $12.5 million in cash and 335,570 shares of Lear common stock, under an agreement reached before the vote. The company also agreed to increase the Icahn group's share ownership limitation from 24 percent to 27 percent of the company's outstanding common stock.

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MATTEL 2Q PROFIT RISES

LOS ANGELES — Mattel Inc. reported a 15 percent increase in its second-quarter profit Monday with strong sales of toy cars, although Barbie revenue in the U.S. fell for the second consecutive quarter.

The toy maker posted net income of $43.1 million, or 11 cents per share, compared with $37.4 million, or 10 cents per share, a year ago.

Revenue totaled $1.02 billion, up from $958 million in the year-ago period.

The company's profit matched expectations of analysts surveyed by Thomson Financial, although revenue fell below the $1.03 billion analysts were looking for.

The company said global gross sales for Barbie rose 6 percent, although four of those percentage points came from fluctuations in currency exchange.

Barbie sales in the U.S. fell 5 percent in the quarter.

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CHARGES DROPPED AGAINST 13 EX-KPMG WORKERS

NEW YORK — A federal judge dismissed charges Monday against 13 former KPMG employees in what the government had described as the largest criminal tax case in U.S. history, saying the prosecutors prevented them from presenting their defenses.

U.S. District Judge Lewis A. Kaplan said the dismissal was necessary because the government coerced KPMG to limit and then cut off its payment of the one-time employees' legal fees.

The case resulted after the government investigated what it described as a tax shelter fraud that helped the wealthy escape $2.5 billion in U.S. taxes.

Yusill Scribner, a spokeswoman for federal prosecutors, said the government had no comment.

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MCDONALD'S EXPECTS 2Q LOSS

CHICAGO — McDonald's Corp. said Monday it expects to post its second quarterly loss in more than 50 years because of a hefty one-time charge on the sale of some Latin American operations.

But the world's biggest fast-food restaurant chain said its business is growing because of momentum from its popular breakfast menu.

McDonald's said it expects to report a net loss of 60 cents per share when it releases second-quarter earnings July 24.

But excluding a $1.31-per-share charge for the sale in Latin America, McDonald's said it likely would surpass Wall Street forecasts and earn 71 cents per share from continuing operations for the quarter ending June 30. That's a 27 percent increase from the 56-cents-per-share profit it posted a year earlier.

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HOUGHTON MIFFLIN BUYS HARCOURT

BOSTON — Houghton Mifflin Co. said Monday it agreed to buy the Harcourt education and trade publishing units from Dutch-Anglo publisher Reed Elsevier PLC for $4 billion in cash and stock, expanding its portfolio of education-related publications.

Houghton Mifflin, the Boston-based unit of Houghton Mifflin Riverdeep Group PLC, will pay $3.7 billion in cash and $300 million in the parent company's stock to buy Harcourt Education, Harcourt Trade and Greenwood-Heinemann.

Reed Elsevier announced earlier this year its intention to sell its education publishing businesses to focus on more profitable publishing units. In May, Pearson PLC agreed to buy Harcourt Assessment and Harcourt Education International for $950 million.

The deal is expected to close in late 2007 or early next year, pending regulatory approvals.

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GALLOIS TO BE EADS CEO

TOULOUSE, France — The parent company of troubled plane maker Airbus abandoned its twin-chief executive structure held jointly by Germany and France, with France's Louis Gallois taking control, the company said Monday.

The European Aeronautic Defence & Space Co. said German Ruediger Grube is to become the sole chairman, and German Thomas Enders takes over Gallois' former role as chief executive of Airbus, while stepping down as co-CEO of EADS.

He will report to Gallois, now responsible for leading the management team. Grube will oversee Gallois' decisions and lead a newly created strategic committee, EADS said.