digest/turner/24″/1stjc/mark2nd

Energy venture

Pacific Enterprises of L.A. and Enova Corp. of San Diego announced the formation of a joint venture last week to develop and sell natural gas and electric products and services from their unregulated business lines.

The venture, called Energy Pacific, will offer gas marketing, energy management and wholesale energy services, as well as consumer products, as part of its broad business line. The venture will be based in L.A. and employ between 75 and 100 people initially.

The new venture combines the fledgling deregulated business lines of Pacific Enterprises and Enova, which are currently in the process of merging. Pacific Enterprises owns Southern California Gas Co., the main supplier of natural gas to Southern California residents and businesses, while Enova owns San Diego Gas & Electric, San Diego’s main electric utility.

A merger of Enova and Pacific Enterprises was first announced last October, and shareholders of the two companies approved the transaction last week. The deal still needs to be approved by government regulators.

Energy Pacific was formed as a vehicle for combining and expanding the growing number of deregulated products and services introduced separately by Enova and Pacific Enterprises in recent months, said Eric Nelson, the new venture’s president.

If and when the two utilities merge, Energy Pacific will either become a fully-owned subsidiary or a business unit of the new merged company, he said.

Office supply maneuvers

In an effort to head off opposition of their proposed merger by U.S. regulators, Staples Inc. and Office Depot Inc. agreed last week to sell 63 stores including 14 in L.A. County to competitor OfficeMax Inc.

Even after the $109 million deal (which has not been agreed to by OfficeMax), a combined Staples and Office Depot would own 1,086 outlets across the country, making it by far the biggest office supplies chain in the U.S. OfficeMax, its biggest competitor, would have 638 stores.

Regulators with the Federal Trade Commission are concerned that a Staples-Office Depot combination would be large enough to dominate the office supplies market in some cities, leading to higher prices for consumers. The FTC announced March 10 that it planned to block the merger, prompting the two companies to announce two days later that they would sell the 63 stores.

FTC officials said they would study the proposal, and have not yet decided whether to allow the merger to proceed.

Westborough, Mass.-based Staples announced its intention to buy Delray Beach, Fla.-based Office Depot in September. The stock exchange deal is worth approximately $4 billion.

Democrats take the coast

The California Coastal Commission ended its brief period of Republican control last week after state Assembly Speaker Cruz Bustamente, a Democrat, appointed four new members.

Environmentalists praised the appointments, which ousted development-friendly panel members appointed last year by former Speaker Curt Pringle, R-Garden Grove.

The four new commissioners include forest practices consultant Andrea Tuttle, San Diego City Councilwoman Christine Kehoe, Monterey County Supervisor David Potter and Santa Barbara attorney Pedro Nava.

The Coastal Commission, which had been controlled by Democrats for its entire 25-year history until last year, has been active in blocking development along the state’s coast particularly in the Malibu area.

Of the four newly appointed panelists, only Nava, a personal friend of Bustamente’s, has no record of supporting environmental causes. The three public officials have all been endorsed by environmental groups.

Williams out

After months of rumors, threatened lawsuits and declining morale at the Los Angeles Police Department, the city’s Police Commission voted last week not to renew Chief Willie Williams’ employment contract.

Williams, L.A.’s first African-American police chief, is credited with helping to heal some of the bitter racial wounds created with the Rodney King beating and riots in 1991. He was appointed in the wake of those events to replace former Chief Daryl F. Gates, whose handling of the crisis was widely criticized.

But Williams’ five-year term has been marked by controversy. He was accused in 1995 of lying about his acceptance of free lodging in Las Vegas a charge Williams denied. He also was criticized for not immediately returning to Los Angeles from Las Vegas when an officer was shot and killed in Hollywood.

Mayor Richard Riordan, who has had a frosty relationship with Williams, told reporters last week that the department needs a more hands-on leader who is better capable of instituting reforms.

Williams is believed to be preparing a lawsuit against the city over the non-renewal of his contract, but nothing has yet been filed.

Dan Turner and Douglas Young