In a Merger of Student-Loan Giants, Sallie Mae Will Buy Much of USA Group

In a deal that would fundamentally alter the marketplace for student loans, Sallie Mae, the country's largest financer of such loans, announced last week that it had purchased USA Group, the nation's largest guarantee agency, for $770-million in cash and stock.

If federal regulators approve the deal, Sallie Mae will take control of all of USA Group's commercial enterprises, which had revenues of $458-million in 1999. Left standing will be the nonprofit USA