ITT Corp.’s decision to offer some of its most valuable luxury hotels for sale prompted officials with Beverly Hills-based Hilton Hotels Corp. last week to say they may cut their $10.5 billion offer for the company.
Analysts say Hilton might give up its takeover battle completely if ITT’s prize properties are sold.
ITT appears to be defending itself from Hilton’s hostile bid by selling up to four of its hotels, including the St. Regis in New York and the Phoenician in Arizona. The company has already agreed to sell Madison Square Garden, a television station, sports teams and stock in an effort to generate cash to help fight off Hilton.
The sale of the four hotels would transform ITT into primarily a hotel management company, with its only significant remaining assets being the Caesars World casinos in Las Vegas and Atlantic City.
ITT’s asset sales up until now have been supported by Hilton officials, who said they were non-core properties that Hilton would have sold after acquiring the company anyway. But Hilton officials said last week that the sale of the four luxury hotels would significantly dampen their interest in the company.
By a margin of less than 1,400 votes, Cindy Miscikowski beat out former mayoral aide Georgia Mercer in the hotly contested race for the 11th City Council District seat last week.
The June 3 election was characterized by near-record low turnout, with only 10.2 percent of the eligible City of L.A. voters casting ballots. That was nearly as bad as the 9 percent voter turnout in 1983, the city’s worst voting performance on record.
In other races, two bond measures to supply additional funding for L.A. County’s fire and library services both passed, with more than the required two-thirds majority approval.
Voters in East Whittier, Glendale, Hawthorne, Irwindale and Cerritos approved school bond measures, while voters in El Segundo, Pomona and Torrance turned them down.
Retired teacher Valerie Fields defeated Kenneth Sackman for the Los Angeles Board of Education seat held by Mark Slavkin after winning 59.3 percent of the vote.
Kelly Candaele took the seat held by Lindsay Conner and incumbent Althea Baker was reelected to the Los Angeles Community College District board.
The Los Angeles Board of Education last week approved a controversial proposal to extend health benefits to the domestic partners of unmarried employees, a move projected to cost the district as much as $6.1 million a year.
The move follows similar decisions by other local government entities; the City of Los Angeles approved domestic partner benefits in 1993, and L.A. County followed suit in 1995.
The school district proposal was the subject of heated debate during a public hearing last week, during which speakers accused the board of condoning homosexual lifestyles among employees, as well as encouraging heterosexual employees to live with their partners rather than getting married. A Price Waterhouse study estimated the cost of the benefits at $6.1 million a year, although a school district official pegged it at closer to $2 million.
In separate news, figures released by the state last week showed that the school district’s dropout rate decreased by 13 percent in 1996.
Although the improvement represents the first time in three years that the dropout rate has fallen, the district still has a long way to go. Its dropout rate is still more than twice the statewide average.
Arena Architect Named
The L.A. Arena Co. announced last week that NBBJ Sports and Entertainment will design the new, state-of-the-art sports facility to be built next to the Convention Center.
The arena, which will be the home of the Kings hockey and Lakers basketball teams, is scheduled for completion by September 1999. It will seat approximately 20,000 people and contain an estimated 150 luxury boxes and 2,500 club seats as well as a variety of retail, restaurant, and entertainment attractions.
PCL Construction Services Inc. was chosen as general contractor for the project.
The decision comes a month after the L.A. City Council approved a deal to build the arena with the project’s developers, Kings’ owners Ed Roski Jr. and Philip Anschutz.
“We chose NBBJ and PCL because they have the vision to create a world-class sports and entertainment venue for the Los Angeles community,” said John Semcken, vice president of Majestic Realty Co. and project executive for the proposed arena.
Los Angeles-based NBBJ is the second largest architecture firm in the nation, and has completed other projects like Seattle Mariners Ballpark. PCL has completed such projects as the 42-story Citicorp Plaza. Both firms worked together on the 17,000-seat NBA arena for the Seattle SuperSonics.
Phone Card Deals
Los Angeles-based SmarTalk Teleservices Inc. purchased GTI Telecom Inc. last week for $70 million, adding 4,000 outlets to SmarTalk’s existing retail network for pre-paid telephone cards.
With the purchase, SmarTalk acquired contracts with retailers Food4Less, Ralphs Grocery Co. and Spenser Gifts, which will now begin carrying SmarTalk calling cards. SmarTalk paid for the purchase by issuing 2.5 million shares of stock, and assuming about $10 million of GTI debts.
A week earlier, SmarTalk purchased Boston-based SmarTel Communications Inc., another pre-paid phone card firm. The terms of that deal were not disclosed.
Dan Turner, Joe Bel Bruno and Ben Sullivan