RECOVERING: Los Angeles’ economic recovery is under way and will pick up steam next year, according to the latest forecast from the UCLA Anderson School of Management. The non-farm payroll employment rate is expected to bottom out in 2010 and increase by about 2 percent in 2011. Personal income growth, taxable retail sales and residential building permits also are expected to turn positive for 2010. The forecast notes that the local housing market is starting to improve as homebuilders take out more permits, foreclosure rates decline and both prices and sales inch upward.
INCENTIVES: Los Angeles Mayor Antonio Villaraigosa has proposed expansion of the city’s tax exemption for new businesses. Calling the program a “tax holiday,” the mayor said the proposal would exempt a business from city gross receipts taxes for three years when it opens or relocates to Los Angeles. The city’s current business tax exemption for new businesses only lasts two years and applies only to businesses coming from outside the city that have less than $500,000 in taxable gross receipts. A study estimates the new policy could create up to 55,000 jobs.
TAKEOVER: East West Bancorp Inc. continued to expand with acquisition of the assets and banking operations of Seattle’s Washington First International Bank. The failed bank’s branches have reopened as branches of East West Bank, which assumed about $441 million in deposits and $521 million in assets, according to the Federal Deposit Insurance Corp.
TENDER RESULTS: Carl Icahn said he spent $109 million to acquire 15.6 million shares of Lions Gate Entertainment Inc., by the June 16 deadline for his $7-a-share tender offer, about 13 percent of outstanding shares. The activist investor now controls about 32 percent of the specialty film and TV studio, which has corporate headquarters in Vancouver, British Columbia, but most of its operations in Santa Monica. Icahn intends to mount a proxy battle to put his own representatives on the board.
LOAN PROGRAM: Goldman Sachs announced a $20 million loan program for Los Angeles-area small businesses. The program is part of a $500 million nationwide assistance effort called “10,000 Small Businesses” that began in New York City. The company launched the program last November as the investment banking giant was under fire for granting large executive bonuses after receiving a $10 billion taxpayer bailout. Los Angeles City College, Long Beach Community College District and the Valley Economic Development Center are serving as clearing houses for the program.
CLASS ACTION: The Los Angeles Airport Hilton was hit with a class action lawsuit alleging the hotel has skirted L.A.’s living wage law. The Los Angeles Superior Court lawsuit was filed on behalf of two housekeepers. It alleges the hotel used a temporary employment agency to hire workers and pay those workers less than the city’s living wage. The lawsuit also alleges that the agency, Norma’s Corp., did not make required benefit contributions, including unemployment. The hotel, which opposed extension of the city’s living wage law to airport-area hotels, has not issued a response to the suit.
CLOSED: The Federal Trade Commission has closed SBN Peripherals Inc., which was accused of making tens of millions of illegal telemarketing calls to sell worthless auto warranties and credit card interest rate reduction programs. A federal judge in Chicago earlier issued a temporary restraining order against the Agoura Hills company after an FTC complaint accused it of making unsolicited recorded telemarketing calls to consumers who either had not given written consent or were listed on the national Do Not Call Registry.
RADIO RATINGS: Top 40 station KIIS-FM (102.7) held on to the top spot in Los Angeles radio market for the fifth month in a row and listenership spiked. The station, owned by Clear Channel Communications Inc., claimed a 6.1 percent share of listeners in May, up from a 5.8 percent share in April, according to Arbitron ratings. Classic hits station KRTH-FM (101.1) and contemporary station KOST-FM (103.5) held on to second and third place with 4.9 and 4.1 percent shares, respectively.
PULL BACK: Media mogul John Malone stepped down as chairman of DirecTV and significantly reduced his voting stake in the nation’s largest satellite TV company as part of a reorganization to satisfy regulators. Chief Executive Michael White has replaced Malone as chairman of the El Segundo company. Before DirecTV was combined with several businesses from Malone’s Liberty Media earlier this year, the Federal Communications Commission expressed concern over both companies’ overlapping activities in Puerto Rico, among other issues.
ACQUISITION: Teledyne Technologies Inc. said it planned to buy British electronics maker Intelek Plc. in a deal valued at nearly $41.5 million, including the assumption of debt.
DIVESTING: Superior Industries International Inc. said it is selling its share of a Hungarian joint-venture manufacturing plant. The Van Nuys manufacturer of aluminum wheels said that its 50-percent stake in Suoftec Light Metal Products Production & Distribution Ltd., will be sold to the other half owner, Otto Fuchs KG in Meinerzhagen, Germany. Terms were not disclosed.
EARNINGS: Motorcar Parts of America Inc. reported net income of nearly $2.9 million for the quarter ended March 31, compared with a loss of $1.18 million a year earlier. Revenue rose 29 percent to $38.6 million. … Korn/Ferry International reported fiscal fourth quarter net income of $8.9 million for the quarter ended April 30, compared with a loss of $17.2 million a year earlier. Revenue rose 55 percent to $177 million. … Capstone Turbine Corp. reported a fiscal fourth quarter net loss of $12.9 million, 7.5 percent larger than a year earlier. Revenue rose nearly 38 percent to $16.3 million.
For reprint and licensing requests for this article, CLICK HERE.