MAGAZINE SOLD:
Macrovision Solutions Corp., which acquired Gemstar-TV Guide earlier this year primarily for its interactive program guide technology, has sold the struggling TV Guide print magazine to Beverly Hills investment firm OpenGate Capital. Santa Clara-based Macrovision said in a regulatory filing that OpenGate would assume certain liabilities of the magazine business in exchange for a loan from Macrovision not to exceed $9.5 million, at 3 percent interest, to help fund magazine operations. The magazine lost about $20.3 million in 2007, according to Gemstar’s last annual report. Macrovision plans to sell the cable TV Guide Channel separately.
ACQUISITION:
Mercury General Corp. said it has agreed to buy three specialty insurance lines of Chicago-based Aon Corp. for $120 million. Los Angeles-based Mercury General, which sells automobile and homeowners insurance, said the deal includes these businesses: Auto Insurance Specialists Inc., a California auto insurance broker; PoliSeek, which provides online and over-the-phone quotes of various types of insurance for comparison purposes; and Aon Recreation Insurance, which sells insurance for recreational vehicles. The deal, which is expected to close in the first quarter of 2009, includes a potential earn out of up to $34.7 million payable over the two years following the sale.
SALES FORECAST:
Home prices in California will drop 6 percent next year after falling about 32 percent this year, the California Association of Realtors said in its annual housing forecast, blaming the continued downturn on foreclosed houses jamming the market and problems prospective homebuyers are having in obtaining mortgages during the credit crisis. The median price for detached, single-family homes likely will drop to $358,000 next year from an estimated $381,000 this year. Conversely, the number of homes sold likely will rise 13 percent to 445,000 next year due to lower prices, compared with a likely 12 percent increase this year.
SPIELBERG SIGNS:
Stacey Snider and Steven Spielberg said their new motion picture company has signed a seven-year worldwide distribution deal with Universal Studios for about six films per year starting in 2009. The DreamWorks SKG principals recently departed Paramount Pictures to partner with Reliance Big Entertainment on the new company. Reliance Big will distribute the new company’s projects in India. Universal will take an 8 percent distribution fee for U.S. distribution. DreamWorks still has contractual obligations to complete around 30 pending projects with former Paramount, but Universal could share domestic distribution on some of those films. Spielberg had a two-decade career with Universal as a director until he co-founded DreamWorks with Jeffrey Katzenberg and David Geffen.
BUSINESS PUCHASED:
Korn/Ferry International said it has agreed to buy Lore International Institute, which provides leadership development, executive education and coaching services, in an all-stock deal whose value was not disclosed. Durango, Colo.-based Lore, which does 40 percent of its work outside the United States, will become part of the Los Angeles staff recruitment company’s leadership and talent consulting division. Korn/Ferry said the all-stock deal is expected to close in the next 30 days and will add to earnings in the following 12 to 18 months.
TOY ACQUISITION:
Jakks Pacific Inc. said it purchased two privately held toymakers, one of which licenses the Batman and Dora the Explorer lines, to help broaden the Malibu toy maker’s offerings. The first company, Kids Only Inc., is based in Westborough, Mass., and makes themed indoor-outdoor children’s furniture, baby doll products and other items. The second, Tollytots Ltd. is a Hong Kong-based company that makes licensed baby dolls and accessories based on Graco and other brands. Terms of the deals were not disclosed.
FEWER CONDOS:
Owners of the former Robinsons-May department store property in Beverly Hills say they want to reduce the number of condominiums in their planned $1 billion residential and retail development on Wilshire Boulevard and replace them with hotel rooms. Developer Nicholas Candy’s 8-acre property is now approved for 252 condos, but to improve their chances of getting construction financing in a tight credit market, Candy said he and his brother Christian want permission to build 200 to 250 hotel rooms and only 100 to 125 condos. The planned development includes two 12-story buildings, a two-story building containing town houses, and two four-story loft buildings situated around landscaped gardens.
EARNINGS:
Reliance Steel & Aluminum Co. reported third-quarter net income of $153 million, compared with $93.6 million a year earlier. The L.A.-based metal services company said revenue rose 42 percent to $2.57 billion. Hi-Shear Technology Corp. reported first-quarter net income of $1.16 million, compared with $1.13 million a year ago. The Torrance maker of components for the aerospace and defense market said revenue rose 7 percent to $6.04 million. First Commerce Bancorp reported third quarter earnings of $274,000, compared with $865,000 for the same period a year ago. Assets rose 3 percent to almost $300 million. American Business Bank reported third-quarter net income of $1.45 million, compared with $1.35 million for the same period a year earlier. The L.A. bank holding company said total assets grew 19 percent to $702 million.
CORRECTION
In an article headlined “Accent on Ads” in the Oct. 13 issue, the name of the publisher of El Clasificado was incorrect. Her name is Martha de la Torre.
