BANKRUPTCY: Metro-Goldwyn-Mayer has filed for Chapter 11 reorganization, enabling the Century City studio to eliminate more than $4 billion in debt and giving control to a group of hedge fund creditors. Production company Spyglass Entertainment will run the studio. MGM reached a settlement with billionaire investor Carl Icahn, who had accumulated a large chunk of MGM debt and favored a rival offer from Santa Monica’s Lions Gate Entertainment Corp., where he is the largest individual shareholder. Icahn will have a seat on the new MGM board. The studio hopes to have the prepackaged bankruptcy plan confirmed by the court in 30 days.
NEW BRIDGE: The California Transportation Commission has approved the Port of Long Beach’s plans to replace the Gerald Desmond Bridge, clearing the way for Caltrans and the port to seek firms to design and construct the $950 million span. The commission’s decision is the final governmental clearance needed for the project. The port plans to issue a solicitation for design-build firms to bid on the job. Final design and preliminary construction are scheduled to begin early next year, and construction of the main bridge supports could start in 2012. The 42-year-old bridge is part of a heavily trafficked commuter route and is used to transport cargo to and from the port. Port officials estimate it carries about 15 percent of the nation’s containerized goods.
MORE SHARES: Lions Gate Entertainment Corp.’s deal to increase the number of shares held by board member Mark Rachesky, a move challenged by hostile suitor Carl Icahn, was upheld by a Canadian court. The British Columbia Supreme Court dismissed Icahn’s petition to undo the deal. Icahn, who is attempting to buy the independent film and TV studio for $7.50 a share, was seeking to reverse an equity-for-debt swap that put more shares in the hands of Rachesky, who has backed management against Icahn’s takeover attempt.
RELOCATION: LegalZoom.com has signed a 10-year lease for headquarters space in Glendale, making good on a threat to move out of Los Angeles after a tax-rate dispute. The 400-person company will move from Hollywood into Glendale City Center on Brand Avenue. LegalZoom provides online legal documents, which the company contented made it eligible for the lowest business tax rate as an Internet firm. But L.A. officials classified it as a professional services firm, which pays the highest business tax rate. A temporary compromise was reached, but the company said it would move anyway. Glendale has no business tax, but charges businesses a nominal zoning fee.
SOLD: Supervalu Inc. an Eden Prairie, Minn., supermarket chain owner, has sold its upscale Bristol Farms supermarket business to a management team backed by an investment firm with stakes in several grocery companies. Financial terms of the deal with Endeavour Capital, which has offices in Los Angeles, were not disclosed. Bristol Farms, which is based in Carson, operates 14 locations, the majority of them in Los Angeles County.
JUDGE RULES: Rivals Mattel Inc. and MGA Entertainment Inc. are set to battle another round in their long-running dispute over the Bratz fashion dolls after a federal judge ruled that a new trial in the case should proceed. The judge confirmed earlier rulings voiding $100 million in damages awarded to Mattel after a 2008 jury trial and granted MGA’s request for a new trial, set for Jan. 11. Judge David Carter made the decision based on his finding that the judge in the original case made numerous errors during the trial.
CLOSER TIES: THQ Inc. and World Wrestling Entertainment have signed a marketing agreement that integrates THQ’s video games into events, pay-per-view and TV sponsorships and magazines. The deal includes installation of interactive gaming kiosks featuring the Agoura Hills company’s products at 40 WWE live events. THQ also is developing WWE-branded products for the iPad, iPhone and social media.
EARNINGS: Edison International reported third quarter net income of $510 million, 27 percent higher than a year earlier. Revenue rose 3.4 percent to $3.79 billion. … Mercury General Corp. reported third quarter net income of $96.8 million, 39 percent lower than a year earlier. Revenue fell 11 percent to less than $767 million. … DineEquity Inc. reported third quarter net income of $7.8 million, 1 percent lower than a year earlier. Revenue rose 6 percent to more than $335 million. … Herbalife Ltd. reported third quarter net income of $75.7 million, 31 percent higher than a year earlier. Revenue rose 15 percent to more than $688 million. … MPG Office Trust Inc. reported a third quarter net loss of $17.9 million, 62 percent smaller than a year earlier. Revenue rose 1 percent to $112 million. … RealD Inc. reported a second quarter net loss of $5.1 million, 5.6 percent smaller than a year earlier. Revenue increased 69 percent to $65.3 million. … Big 5 Sporting Goods Corp. reported third quarter net income of $6.8 million, 16 percent less than a year earlier. Revenue rose a fraction of a percent to $232 million. … HCP Inc. reported third quarter net income of $17 million, compared with a net loss of $52.4 million a year earlier. Revenue rose 10.5 percent to $317 million. … Stamps.com Inc. reported third quarter net income of $2.73 million, 59 percent more than a year earlier. Revenue rose 8 percent to $18.2 million. … True Religion Apparel Inc. reported third quarter net income of $11.8 million, 16 percent less than a year earlier. Revenue rose 13 percent to $92.8 million. … THQ Inc. reported a second quarter net loss of $47 million, 734 percent larger than a year earlier. Revenue fell 23 percent to $77.1 million.
An article in the Nov. 1 issue headlined “Failing Grade for PLA School Job?” said project labor agreements require contractors to pay into union benefit funds. However, the special funds do not benefit all union workers but only those who worked on the specific PLA, including union and nonunion members.
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