Follow LA Observed on Twitter here
How did Sam Zell manage to avoid a huge tax bill in the Tribune deal? Newsweek's Allan Sloan found a small provision in minimum-wage legislation in 1996 that helped pave the way. It was tucked into a bill to help out the owner of a small Minnesota company who wanted to use an employee stock-ownership plan. The company couldn't do the ESOP because it was an S corporation (usually small businesses that have income taxed...
LA Biz Observed archive
Mark Lacter covered business, the economy and more here from 2006 until his death on Nov. 13, 2013.
The entire LA Biz Observed archive — more than 10,000 blog posts by Mark —
remains online and available.
April 2007
The six-month numbers from the Audit Bureau of Circulations show the Times down to 815,723 daily, a 4.2 percent drop, and 1,173,096 Sunday, down 4.7 percent. At the OC Register, daily slipped 5 percent, to 284,613, and Sunday was down 7 percent, to 329,549. The news was generally bleak throughout the country. For all papers reporting, daily circulation for the period ended March 31 fell 2.1 percent and Sunday was down 3.1 percent. The NYT...
Love it, hate it: A survey of L.A. business executives finds general optimism about the local economy, but ongoing gripes about stuff like traffic, taxes and the schools. Almost three-quarters of the executives surveyed expect their companies to do better this year than last. Daily News Eisner's Topps deal: The famous trading card company has some unhappy shareholders who claim that they were shortchanged in the purchase by Michael Eisner's Tornante Co. and buyout firm...
Very light posting over the next few days. Morning headlines will be back early next week....
That had been the name used for various entertainment divisions within the Mouse House. Bloomberg News reports that everything Buena Vista will be changed to just plain Disney, an effort to simplify branding and reduce costs. Most of the company's units will now be Disney, ABC or ESPN, although the Pixar and Miramax film studio names will still be used. Buena Vista is named for the street where the Disney studios and corporate HQs are...
It's looking like Anaheim voters will determine whether that controverisal development in the city's resort district goes up. The City Council early this morning voted 3-2 to approve the 1,500-unit project (including 225 low-cost units) near Disneyland and California Adventure. When the vote first came up a couple of months back, the council was deadlocked 2-2. Since then, the Mouse House has sued the city to block the development - and apparently has enough signatures...
To be exact, 13,089.89, up 135.95 for the day. It only took 129 trading days to go from 12,000 to 13,000. It took almost 1,900 trading days to go from 11,000 to 12,000....
It's money - or at least that's the scuttlebutt. TV Week says that she wanted way more than ABC was willing to fork over, even though the show's ratings have shot up in the past year. ABC exec Brian Frons had this absurd comment about how the network only expected her to stay on a year and that none of this is exactly a surprise. Well, who knows what the real story is - other...
Lee Iacocca should be a hoot this weekend when he blasts George Bush, the health care system, the nation's schools and of course the current crop of corporate leaders. Those are among the topics that come up in his new book, "Where Have All the Leaders Gone?" He'll be introduced by LAT Publisher David Hiller on Saturday at 11:30 at Schoenberg Hall. And that's it from the world of bidness, a topic that obviously doesn't...
Dow over 13,000: At least in the first few minutes of trading. This could be the day the index gets over that milestone, what with strong earnings from Boeing and Pepsico this morning - and Amazon yesterday. Update: After crossing the magic 13,000 mark, there was the expected profit-taking. After a little over an hour, the Dow is at 12,989. Where's Henry Yuen?: You remember him - the former CEO of L.A.-based Gemstar-TV Guide who...
Sam Zell has cut his first check - $250 million towards the purchase of Tribune Co., parent of the LAT. Zell purchased 1.47 million newly issued shares of Tribune at $34 each and a $200 million note that pays interest of 4.81 percent a year, according to a regulatory filing. Zell will be able to participate as a Tribune director (he'll be chairman once the company goes private, presumably by the end of the year)....
Might the underling be getting a little revenge? In this case, it's former Apple Chief Financial Officer Fred Anderson, who said he warned CEO Steve Jobs that backdating stock options could result in some accounting issues. Anderson agreed to settle SEC charges for his alleged role in the backdating case. He's paying $3.5 million in fines, without admitting or denying guilt. But he is talking - or at least his lawyer is. Anderson said he...
Bet you didn't know that schmata bad boy Dov Charney is a graduate of Choate. Well, the Choate magazine plays him up big in an article about would-be entrepreneurs (Gawker is having fun with it this morning.) On paper, it's a pretty inspiring tale - a deep-thinking young man finds a way to buck conventional retail wisdom with American Apparel, which today has more than 144 locations in 50 countries. Products are made in an...
U.S. home sales tank: March was the worst sales month in 18 years, with a decline of 8.4 percent (still well below the Socal sales drops). There are all kinds of logical explanations - bad weather, the subprime mess, etc. – and so far the market seems to be taking it in stride (the Dow is down a touch after 90 minutes). Still, it could get some folks worried. Also, consumer confidence fell significantly in...
We're talking Vegas, baby, Vegas, and the NYT concludes in its headlne that "Too many hotels are not enough." With a 95 percent weekend occupancy rate - and an astounding 90 percent weekday rate - you can see why there's a hotel construction boom in Sin City. The latest and most spectacular effort is MGM's CityCenter project, which borders the Strip, covers 67 acres and will include a 4,000-room hotel, a convention center, a half...
The Pulitzer Prize winning author and journalist was killed in a three-car accident this morning in Menlo Park. The San Jose Mercury News reports that he was a passenger in a car that was broadsided by another vehicle. Halberstam was 73....
Purchase price is about $68 million, according to the Business Journal. The buyer, as earlier reported, is OC-based Newport Capital Advisors, which apparently held up the sale until a 20-year lease agreement was cut with Live Nation to manage and restore the famous venue. What undoubtedly makes the deal pencil out for Newport Capital is the adjacent 3-4 acres that will be developed into the usual mix of housing-office-retail-hotel. Sounds like Newport wants to get...
We're talking up to 76 stories just north of Pershing Square (that would top the 72-story Library Tower as being the tallest structure in the western half of the U.S.). The hotel-condo combo, dubbed Park Fifth, has been doodled over for more than two decades, but developer David Houk told the Downtown News that most of the approvals are now in place - as is the financing - and a new environmental impact report is...
Strong venture numbers: When you lump L.A., OC and San Diego together, it looks darn impressive within the world of venture capital. Socal companies received $1.1 billion of investment in the first quarter, a 23 percent increase over last year. That edges out New England for the runner-up spot behind Silicon Valley. But less than half that number - $401 million - came from L.A., mostly going into computer-related firms. OC and San Diego were...
Joe Hutchinson has been creative director for the Times since 2005 and before that was deputy ME. He's been in charge of the paper's design, graphics and illustrations. He'll become Rolling Stone's art director, LABO has learned. It's a job that he had initially turned down, according to the NY Post's Keith Kelly. Formal word is expected in a few days - right in the midst of the paper's long-awaited announcement about newsroom cuts. The...
To celebrate its 100th birthday, SF's Fairmont is offering two nights in the penthouse for $100,000. Actually, there's more to the package: a 10-carat diamond bracelet, a Rolex watch, a gourmet dinner for 12, and a bottle of 1907 Madeira. Oh, and you get to drive a $140,000 Maserati Quattroporte during the visit. OK, so who exactly would fork over so much money for so much... well, nonsense? Yeah, yeah, rich people, I know. But...
The March number is the highest since March 2006, and it's quite a jump from February's 4.6 percent level. It's also higher than the state's 4.8 percent unemployment rate and the national 4.4 percent rate. So is this a big deal for the local economy? Probably not - we're still a ways off from the 7 percent levels in 2003 - but it's worth noting that L.A. County saw a population gain of just 6,900...
The Dow is up around 100 points as of this writing, so it's looking like 15 out of 16 up days. And yet, the papers don't seem very interested - certainly not the way they were after the big selloff on Feb. 27. Grumpy Editor notes that most all the big dailies - with the exception of USA Today - chose to bury news about the Dow hitting an all-time high this week. It would...
Market takes off: Strong Google earnings have jump-started things this morning as the Dow crosses the uncharted waters of 12,900. One area to watch is the market's breath - that is, the number of advancers vs. decliners. Despite the Dow rising in 14 of the past 15 sessions, the overall action generally has been mixed (the S&P 500 and the Nasdaq were both down yesterday). Speaking of records: Socal gas is within a dime of...
That's what the L.A. Independent is reporting. The buyer, according to an unnamed source, is Newport Capital Advisors, the developer of a planned 87-unit residential project in Hollywood. The property is expected to close escrow in the next week, according to attorney Jerold Neuman, who represents the prospective owner. Last week came word that Live Nation had signed a 20-year lease to operate the concert hall, but there's still the matter of the 4-acre property...
That's the estimate by Forbes in the magazine's annual examination of how much baseball franchises are worth. The valuation is a huge jump from the $482 million last year - and it's based on a bunch of factors, including the Socal market, the stadium and the team's brand management. The Forbes report also shows that the Dodgers operating income this year will be $28 million, compared with $13 million in 2006 (and operating losses for...
She's leaving Dead Horse Media, the blog network that runs DealBreaker, AboveTheLaw, and Fashionista. Spiers is calling it an "insurmountable difference of opinion" with the investors on where to take the business. She wanted to do more sites and they wanted to improve the current lineup. "It's a reasonable position, but not one I agree with," she said in an email to BW's Jon Fine. Spiers was the founding editor of Gawker.com, as well as...
Most of those They were insider trading counts - and that's a potential 10 years in prison for each count. No, he won't wind up doing 200190 years, but the sentence is going to be steep, and of course it'll raise understandable questions about whether someone convicted of a white collar crime should be put away for so long. Nacchio was accused of dumping $100.8 million in Qwest stock in early 2001 when he had...
Market alert: This might be a rocky session, coming one day after the Dow set an all-time record high. The Shanghai market was sharply lower today, as were exchanges throughout Asia. And yet, earnings among the big players - Merrill Lynch, Bank of America and eBay - continue to be strong. Google is expected to report another smashing quarter after the market closes today. In the first hour of trading, the Dow is down 37...
You know things are looking bleak when you've been let go by the TV Guide Channel. No reason cited for not renewing the contracts of Rivers and her daughter Melissa. In case you're wondering, they did those celebrity blabfests on the red carpet of the major award shows. In their place will be Lisa Rinna - and don't pretend you don't know who Lisa Rinna is. She began her career on "Melrose Place" and has...
Wall Street obviously isn't interested in any whining about subprime loans or high gas prices or the yucky state of the world in general. On a day when solid earnings news from Coca-Cola, J&J and JP Morgan outplayed yesterday's lukewarm results from Yahoo, the Dow Jones Industrial Average closed at 12,803.84, up almost 31 points for the session and an all-time high (even though the Dow tumbled 16 points right at the end of trading)....
You think you have a tough job - try keeping track of the nation's priciest homes on the market. Ultimate Homes is out with its annual list and conspicuously absent is Fleur de Lys, the 45,000 square-foot Bev Hills-adjacent estate that's being priced at $125 million. It's being sold by Suzanne Saperstein, ex-wife of the guy who started up the traffic service Metro Networks (and sold it to Westwood One for almost $1 billion). Topping...
BlackBerry blackout: It's shaping up to be a rough day if you rely on a handheld. Research in Motion Ltd., which operates the mobile-email device, apparently suffered a system-wide outage last night. "Please be advised that we are currently experiencing a service interruption that is causing delays in sending or receiving messages," the company's phone message said. Service is being restored this morning, but there have been delays in delivering messages, so you might consider...
KCRW GM Ruth Seymour has been delivering the bad news to listeners all day: The little-known Copyright Royalty Board upheld its earlier decision to impose higher royalty rates on Web radio stations. That means KCRW must pay for every person listening to every song online - and those royalty payments are up to 1,200 percent higher than the fees stations are used to shelling out. Congress may get involved, especially since the decision will be...
That's what the New Yorker's James Surowiecki is strongly suggesting in this week's Financial Page column. He's citing questionable criminal cases against Joe Nacchio, the former CEO of Qwest who is accused of insider trading, and Conrad Black, who is accused of defrauding Hollinger International shareholders. Surowiecki doesn't sound totally convinced that prosecutors have run amok, but when an arrogant piece of work like Black comes off looking like the victim, the government has at...
Time Warner cutting cable?: It's under consideration, according to the WSJ. Just too much Internet competition. Rather than spend all that money on cable, some at TW figure they might be better off focusing on Web stuff. Nothing has been signed off yet, but the most likely scenario would involve gradually reducing its 84 percent Time Warner Cable. From the Journal: Getting rid of a big chunk of its cable holdings would transform the nature...
So much for the slowdown. The government's weekly survey shows that for the period ended today, the average price of self-serve regular in the L.A. area was $3.28 a gallon, 5 cents higher than a week earlier and 17 cents higher than a month ago. The statewide average was $3.30. Who knows whether any of this will impact demand, but shelling out an extra 15 bucks per fill up is bound to be noticed, even...
There's nothing like the annual Fortune 500 to put Los Angeles in its place - but in a good way. Of the top 100 companies, just three are based in the L.A. area: Disney (64), Northrop (73) and Countrywide Financial (91). Add six more to the top 200: Occidental Petroleum (124), DirecTV (160), Computer Sciences (163), Amgen (171), Health Net (189) and Edison International (192). Add two more to the top 300: KB Home (228)...
The paper won the public service award for its probe into backdated stock options - and for international reporting on the adverse impact of China's booming economy. The award on options backdating is likely to be controversial - at least in some circles - because, believe it or not, the practice of going back to pick favorable dates to price your stock options is not necessarily illegal (though many executives did it illegally). Though more...
It's what you would expect with home prices flat to down and those teaser-rate mortgages making way for resets that aren't nearly as forgiving. Statewide, 46,760 notices of default were filed in California in the first quarter, according to DataQuick Information Systerms. That's up 23.1 percent from the previous three months and 148 percent from the same period a year earlier. But while the first quarter numbers are a record in San Diego, Sacramento and...
Travel nightmare: NY airports are up and running this morning after the weekend's rain and wind storm resulted in 500 canceled flights at JFK, LaGuardia and Newark. But there are big-time delays up and down the Eastern seaboard (up to three hours at Newark this morning). Some areas had as much as 9 inches of rain, so there’s lots of flooding. Bloomberg Mattel scores surprise: The El Segundo-based toy company reported a sharp drop in...
LAT reporter Glenn Bunting got access to the final production budget for the 2005 action adventure film "Sahara" and it's a hoot. Actually it's outrageous, but it's also Hollywood and over-the-top expenses are pretty routine. They're also normally held under wraps, which makes this sneak peek especially entertaining. "Sahara" generated more than $200 million in revenue, which is decent money for a relatively unheralded film, but expenses topped $280 million. Among the more insane line...
Nick Paumgarten's piece in the New Yorker about long-distance commuting opens with the obligatory crazy person: an engineer at Cisco Systems who travels 372 miles from the Sierra foothills to San Jose and back - each day. Midas Muffler honored him for having the nation's longest commute - and of course the guy claims he loves it. Paumgarten finds plenty of other folks who may not love traveling a hundred miles or more each day,...
It just so happened that the Imus firing came on the same day the Federal Trade Commission released a report on how easy it is for teens to be exposed to R-rated movies, M-rated video games and foul-mouthed rap stars on CDs and music videos. The answer, according to the report, is pretty easy. Easiest to buy was music - and that doesn't even consider the stuff that gets on cable and Web sites. Post-Imus,...
Here's how former Chrysler chairman - and longtime L.A. resident - Lee Iacocca opens his new book "Where Have All the Leaders Gone?": "We've got a gang of clueless bozos steering our ship of state right over a cliff, we've got corporate gangsters stealing us blind and we can't even clean up after a hurricane much less build a hybrid car." He says "I hardly recognize this country anymore" - and not in a good...
Imus behind the scenes: WSJ does a nifty chronicle of the backstage moments leading to yesterday's Imus firing. In patching together the puzzle parts, it's noteworthy that the ruckus only began to build a couple of days after he uttered those dreaded words (remember there was little print coverage the first day or two). It was the liberal watchdog group Media Matters for America that first clipped the infamous moment on Wednesday April 4 and...
That's how L.A.'s airport commissioner described the airport's failure to upgrade its facilities since the the Bradley terminal opened in 1984 (that's 23 years ago, friends). Rothenberg was at a meeting today of the Los Angeles Business Council where consulting firm SH&E presented a not-so-cheerful report on what's going on. "This may be tough to swallow, but LAX can no longer sell itself just because it is L.A.," said SH&E Director Sonjia Murray. "Other airports,...
Just too much tumult, it seems (so much for earlier post). The network obviously had been hoping that a two-week suspension without pay would do the trick, but advertisers are pulling their ads right and left. Just a quick wire bulletin so far, but they'll be a batch of coverage of course. MSNBC NYT CBS statement on jump....
For all the troubles surrounding the Thousand Oaks-based biotech company, shares rose 2.3 percent today (on a day when the Dow picked up around half a percent). Actually, Amgen stock has been in rally mode since hitting a 52-week low of $55.13 on March 29. Today it closed at $57.64, which may not sound like such a leap if it weren't for the recent batch of really bad news. That included today's announcement from the...
At least in a new Crain's online poll, which was taken before you-know-who was booted from MSNBC. Nearly two-thirds of the 846 respondents said Imus should not be fired, while 26 percent said his slur about the Rutgers women's basketball team is a matter of free speech. "His comments were offensive, but so are the lyrics of much rap music out there, which use terms such as the ones used," said Nora Cofresi. "Such language...
Kind of. Come September, 500 people will be wandering around L.A. with cellphone tracking devices that pick up the sounds of televisions that are on in gyms, bars, hotels, offices - pretty much anywhere but home. It's part of an effort announced today by Nielsen to get a better handle TV viewing in public venues. Over the years, the news and sports channels have griped about ratings that don't factor such viewing. It's a big...
The latest WSJ survey of economic forecasters out today shows only limited concern about the housing market or the prospects of a recession over the next 12 months. What many of them do seem worried about is weakness in business spending. "If there's something that keeps me up at night, it's the potential of corporate America really pulling back," said Nariman Behravesh at Global Insight. Amid signs the economy has lost steam, businesses have become...
The private equity boys took a pass on Tribune (for good reason), but they're interested in just about everything else under the sun - so much so that with stock prices rising, there's increasing concern about cuttting quick - and bad - deals. Steven Rattner, with the private equity firm Quandrangle Group, told Reuters that "we are all feasting off the imprudence of our lenders" and that a the buyout boom is "an accident waiting...
Choppy market: Lots of crummy news out of Iraq and higher oil prices, although March retail sales look pretty good. At last check, the Dow was up 8 points. Palladium deal: Live Nation's plans to invest in a yearlong renovation of the storied Hollywood venue (now there's a well-worn phrase for you) puts an end to months of speculation about what would happen to the 66-year-old music hall. Last summer, a Bev Hills developer planned...
He's Henry Winterstern and he resigned last month as CEO of First Look Pictures, an upstart independent. The NYT's Sharon Waxman did a big writeup on Winterstern as kind of a poster boy for hedge fund money that's being spent in the wrong places by the wrong people. Well, he's back - at First Look. The NYT had an unbylined shortie on C4 this morning that follows up on a piece in Variety. Winterstern says...
In moving this afternoon to drop you-know-who from the MSNBC lineup, NBC said there had been "many conversations with our own employees." That might have included the long-time "Today" show weatherman, who called for the firing of Imus and his producer, Bernard McGuirk, on the show's blog, allDAY. "I, for one, am really tired of the diatribes, the 'humor' at others' expense, the cruelty that passes for 'funny,'" Roker writes. "Don Imus isn't the only...
The eight-session winning steak is over. The Dow was down all day, not helped by the minutes of the latest Federal Reserve policy meeting that showed continuing concern about inflation (wait until they factor in $3.50 a gallon for gas). There also was a forecast about slumping home sales. It really didn't take much. All told, the DJIA closed at 12,484.62, down 89 points on the day. The record of 14 consecutive winning sessions remains...
It's the outgrowth over that flap about the airport jacking up United's rent. The increase amounts to $10 million and rather than eat the extra expense, United is tacking it onto tickets. Basically, the airline said it was sorry and supported LAX's modernization efforts, but not on its dime. Think about that one the next time you're crammed into a middle seat in front of a crying baby and told by the pilot that there's...
What is it with L.A. billionaires trying to buy companies? First the B&B Dudes got turned down by the Tribune boys in favor of their home-grown hero, Sam Zell, and now Kirk Kerkorian is getting nowhere fast in pursuit of Chrysler. Of course, offering a paltry $4.5 billion - by some estimates 50 percent below the automaker's value - doesn't exactly help. He's being shut out of meetings that DaimlerChrysler is having with the other...
The so-called 145 study involving the biotech company's top-selling Aranesp anemia drug is getting so much attention on Wall Street that Amgen said that it would delay the release of first-quarter earnings by four days to include "top-line results" from the research. The big question is whether anemia drugs like Aranesp actually feed the growth of tumors. Last month, the FDA warned doctors to use the lowest dose that can effectively avoid the need for...
Bev Hills stunner: British developers are paying $500 million for the now-closed Robinsons-May near the corner of Santa Monica and Wilshire Boulevards - one of the nation's most congested intersections. But not to worry - Candy & Candy, the London-based buyer (the name alone is worth a few million), says that the new complex of 252 luxury condos and retail won't generate any more traffic than the old Robinsons-May. Well, er, the nearby homeowners groups...
A new LAT/Bloomberg poll finds that 60 percent of those surveyed believe that a recession is looming within the next 12 months. That number is similar to the 64 percent who (correctly) expected a pullback in a December 2000 LAT poll. Most economists believe we'll be spared a recession this year, but the outlook after that is unclear. For the record, recessions in presidential election years almost never happen - mostly because there's usually an...
How do you unload downtown condos that have gone begging because of a sluggish real estate market? You rent them, of course. Real estate folks are telling the Downtown News that this might not be such a bad thing because rental units are in demand (young hipsters might not be ready to buy) and because it services the construction debt. Rents are running from $2,000 on up - well above the countwide average of $1,470,...
The Dow finished in positive territory for the eighth consecutive trading session. The last time that happened was four years ago, although when that streak ended, the Dow lost 300 points in one day. But hey... The all-time record, by the way, is 14 consecutive up sessions. Today's gain didn't amount to much - 4.71 points, to close at 12,573.85. Very little action to note among local stocks - even Amgen, which was the subject...
Perhaps those sky-high housing prices are finally having some effect on growth. For whatever reason, Los Angeles County saw a population increase of only 6,900 between July of 2005 and July of 2006. The annual average going back the previous five years was 69,500, so we're looking at a significant slowdown (OC and Ventura also showed declines in population growth). The one area of Socal that keeps booming is Riverside-San Bernardino, which showed a gain...
Amgen troubles: The WSJ tops its front page with a large takeout on the biotech company's growing problems - mostly related to safety questions involving two of its biggest drugs that treat anemia. Analysts say that sales of Epogen and Aranesp fell faster than expected in the first two months of the year. A new Amgen study on whether Aranesp causes tumors to grow faster will be out soon - and company officials just hope...
Competing with iPods: Yahoo, along with two smaller companies, are collaborating on a $250 MP3 player that hit store shelves on Friday. Called the Sansa Connect, the device will allow users to download music from the Internet wirelessly even when they're not near a personal computer. It's part of an effort to compete against Apple by integrating software, hardware and online music services. Yahoo, with its Internet music service, is being joined by device maker...
Last month we dutifully reported on the compensation for Occidental Petroleum Chairman and CEO Ray Irani. It was very big - $52.8 million, which covered salary, bonus, stock awards and options. But as it turns out, $52.8 million was merely chump change. After throwing in the proceeds of a deferred-shares program that the L.A.-based company ended last year, plus the additional exercising of options, Irani's total now comes to a mind-boggling $416.3 million. That's not...
Zell on LAT: He told reporters yesterday that he doesn't plan on selling the Times or any other Tribune media properties. He said he'd met David Geffen once in his life and that there have been "no discussions with him whatsoever." Zell, who was speaking at Stanford University, said he had received 1,000 e-mails since the deal was announced, including from other potential investors who are interested in buying parts of Tribune. But his plan...
The publicity shy Denver billionaire who owns half of downtown L.A. (approximately) and who would do most anything to avoid talking to a reporter found himself facing a bunch of those ink-stained wretches today as the first defense witness in the trial of former Qwest Communications CEO Joe Nacchio. Anschutz is the founder of Quest, and his testimony was used to establish Nacchio's state of mind at the time he is accused of illegally selling...
Who exactly is "a source familiar with Geffen's thinking who spoke on condition of anonymity because negotiations are ongoing"? The Washington Post's Frank Ahrens is the latest reporter to buy into the claim that David Geffen not only wants to purchase the LAT from Sam Zell (or establish some sort of partnership), but is already in negotiations. "Zell in talks with Geffen on deal for L.A. Times" is the headline. It's basically a pickup of...
The L.A. billionaire, through his Tracinda Corp. investment vehicle, is prepared to offer $4.5 billion cash for the struggling unit of DaimlerChrysler that has, more or less, been on the block for some time. At the company's shareholders meeting in Berlin today, CEO Dieter Zetsche (the guy with the mustache in those not-so-funny commercials) confirmed the company is in talks with would-be buyers. The WSJ reports that aside from Kerkorian, the company is receiving interest...
More houses on market: Way more, in fact, according to the latest numbers from the end of March. The L.A. area saw a 12.8 percent increase in inventory levels compared with a month earlier. Only SF comes close among the major markets, at 12.2 percent. To give you some perspective, the March inventory increase averages 1.7 percent nationwide. One explanation: sellers wanting to move over the summer are realizing that it will be tougher to...
The Calabasas-based homebuilder and mortgage finance company blamed lower sales and a $65 million impairment charge related to assets in Fort Myers, Fla., Phoenix, Socal and Washington D.C. What's an "impairment charge," you ask? It's basically writing off worthless goodwill in a financial statement. Ryder is also writing off the $15 million in goodwill associated with the acquisition of a California homebuilder, MJ Brock & Sons. That's substantially all of the company's remaining goodwill. The...
Before we get to that burning question, let's take care of some bidness bookeeping. The two big providers of movies in hotel rooms have merged. LodgeNet Entertainment Corp. has completed the acquisition of Ascent Entertainment Group Inc., the owner of On Command Corp. for $380 million in cash and stock. Bev Hills-based Hilton Hotels is a LodgeNet client. The deal will give LodgeNet more leverage in cutting deals with content providers. "Consumers have more and...
Both sides are suddenly talking tough. The three major supermarket chains - Ralphs, Vons and Albertsons - announced that they would lock out employees at their Socal stores if any of the chains becomes the target a strike. In response, union officials broke off contract talks with the chains. As you might recall, this is how the devastating 2003 labor dispute got started, when the union ordered a strike against Vons, and Ralphs and Albertsons...
Tribune sale: Is it really over? This morning's coverage, especially in the NYT, suggests that there might be some interest in raising the bid for Tribune. The focus is on Eli Broad and Ron Burkle, who had their unnamed mouthpieces tell folks that "they are continuing to study the opportunity." If they do make a move, it will probably be through Tribune and not Zell - at least according to Zell's interview with the Chicago...
The Chicago Tribune got a lot of face time with Sam Zell and he didn't disappoint. Basically, he said what winning bidders of big corporations usually say: he needs to figure out how the place works. It also sounds like he won't have much appetite for the romper room atmosphere that's become the LAT. Which in the Zell way of thinking means if your boss tells you to do something, you do it - end...
The Society of American Business Editors and Writers just came out with its annual Best in Business awards, and there's not a single Southern California paper on the list. That's a first, at least in my memory. The nearest winners were the San Jose Mercury News, Sacramento Bee and Press Democrat in Santa Rosa (which I judged in the small newspaper category). Not to stir the pot among the locals, but it's worth noting that...
It's one thing for public companies to offer outrageous perks to their fat cats - it's quite to another to deny it. So we have the case, courtesy of Michelle Leder at footnoted.org, of Liberty Media, the content and distribution plaything of billionaire John Malone. Liberty has its hands in lots of stuff: El Segundo-based DirecTV, Starz, Discovery Channel, QVC, etc. It's huge. Anyway, its just-released proxy declares that the company is not offering "perquisites...
Market up sharply: Better home sales numbers and a possible breakthrough involving those British sailors in Iran are a couple of the explanations. The Dow is up 125 points after 90 minutes of trading. Bloomberg Tribune story: All kinds of coverage, as you can imagine, but much of it just recapping familiar ground: the tortuous auction process, the money-grubbing Chandlers, the pros and cons of employee stock ownership plans, the colorful and unorthodox Sam Zell,...
It looks like LAT Editor Jim O'Shea will be around a while - or as he put it in a memo to staff, "as long as people in the newsroom will have me." He has nice things to say about Sam Zell and notes that a "fresh shot of new thinking is not going to hurt us, along as we remain committed to what is really important, our coverage of the news." This is a...
Blah, blah, blah, blah.... Here it is, just six hours after the announcement, and already I'm in overdoze mode. Oh yeah, I realize there are hundreds of key questions if you're a Tribune employee - starting with that most important, "What does this mean for me. Sorry, but it's going to be many months - perhaps even a year or so - before you'll be able to take a stab at that one. I realize...
This one had been in the works for two or three weeks. The OC subprime mortgage lender filed for Chapter 11 bankruptcy protection. The company listed over $100 million in assets and more than $100 million in debts, although you shouldn't pay much attention to those numbers because bankruptcy filings only require a range. "More than $100 million" is the largest value range given. As part of the filing, New Century said it will cut...
Sam Zell was apparently far, far away from the tension-filled Tribune board room, where the future of the Chicago-based media giant was being hashed out over the weekend. The Chicago Tribune notes that Zell was calling the shots from his Malibu beach home, where he spends lots of time. The 12,000 square-foot property has four family bedrooms, a guest house and a staff wing with kitchen and dining areas. The home, on 1.2 acres, also...
The company finally made the announcement this morning. The price is $34 a share, or $8.2 billion. Zell nudged up his offer by a buck in the closing hours of the auction. There's a pretty low break-up fee - $25 million - that could encourage Eli Broad and Ron Burkle to raise their offer. But this seems to be a done deal. NYT quotes people close to the talks as saying that the board was...
As of late Sunday night, real estate mogul Sam Zell seemed tantalizingly close to cutting a deal for the Chicago-based parent of the LAT. But Tribune's board appears to be pushing for more than $33 a share - and perhaps more than $34 a share. That could be in response to the 11th hour Broad/Burkle bid that's valued at $34 a share. Zell is normally not the kind of guy who raises his bid, but...
Foodies are a strange bunch. How else do you explain people (or their assistants) spending weeks or months calling or emailing some hotsy-totsy restaurant in pursuit of a dinner reservation at 5:30 in the afternoon? And for all that hassle, you get to shell out several hundred bucks for a meal that might not be very good and for service that will often be indifferent or worse. Talk about a deal! The WSJ examines how...
Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.The multi-talented Mark Lacter
New at LA Observed