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Friday, May 27, 2022


SITRICK SELLS: Sitrick and Co., an L.A. public relations firm known for its celebrated and controversial clientele, is expected to be acquired next month by consulting firm Resources Connection Inc. Resources will make an initial payment of $43.3 million in cash and stock for Sitrick and Brincko Associates, a small restructuring firm that is also being purchased as part of the deal. Sitrick is best known for representing clients ensnared in scandal – including the Archdiocese of Los Angeles during a sexual-abuse lawsuit and Paris Hilton after her release from a brief jail stint. But much of the firm’s work is on more humdrum corporate matters, especially bankruptcy issues.

SUIT FILED: People’s Liberation Inc. said it has filed suit against Charlotte Russe Merchandising Inc., the exclusive distributor of its flagship denim line, for breach of contract and other claims after the national retailer said it would stop selling People’s Liberation products. The L.A. designer is seeking more than $60 million in compensatory and punitive damages.

MEDIA SPINOFF: Michael Eisner’s private equity firm Tornante Co. has spun out Vuguru, its Internet content production house, with financial backing from one of Canada’s largest media companies. The partnership agreement between Tornante and Rogers Media Inc., a division of Toronto’s Rogers Communications Inc., turns Vuguru into an independent company. Eisner, former chief executive of Walt Disney Co., launched Vuguru in late 2006 and was a pioneer in producing scripted shows for Web and mobile TV distribution.

GOING GOOGLE: Los Angeles has become the largest city in the nation to outsource its e-mail to a Web-based system run by Internet search giant Google Inc. The City Council voted unanimously to shut down the city’s in-house messaging system and transfer e-mail operations for its 30,000 employees to Google’s nationwide network of servers. The decision is expected to influence other major cities and large corporations considering whether to stay with older e-mail programs, such as Microsoft Corp.’s Outlook, or to embrace Google. Microsoft lobbied the city against the change.

ACQUISITION: Ares Capital Corp. said it will buy Allied Capital Corp., which finances middle-market company buyouts, in an all-stock deal worth $648 million. The deal gives shareholders of Ares Capital, an affiliate of L.A. investment management firm Ares Management LLC, a 65 percent stake of the combined company. The companies expect the deal to close in the first quarter of next year after shareholder approval. Ares Capital invests primarily in first- and second-lien loans and mezzanine debt, sometimes with an equity component. Allied Capital invests in long-term debt and equity capital.

FILM FUNDING: Relativity Media said it has secured $300 million in revolving credit from Comerica Bank and Union Bank. The company is expected to use the money for its Beverly 2 subsidiary, which co-finances Universal Pictures films. Relativity signed a partnership with the studio four years ago and is now co-financing about 75 percent of Universal’s slate through 2015.

IRS RULING: John Malone’s Liberty Media Corp. said it has received approval from the U.S. Internal Revenue Service for a tax-free split-off of its Liberty Entertainment unit ahead of a merger with DirecTV Group Inc. Malone is the controlling shareholder of El Segundo’s DirecTV, the largest U.S. satellite TV operator, and will seek approval from shareholders Nov. 19 to combine it with Liberty Entertainment assets, such as regional sports networks and gaming company Fun Technologies.

NEW FACILITY: The Walt Disney Co. said it plans to build a 56-acre sound stage and production facility at its Golden Oak Ranch property in the Santa Clarita Valley. The complex will enable the Burbank entertainment giant to produce more motion picture, television and commercial productions in the L.A. area. Disney has used the 890-acre ranch for outdoor filming for five decades. Once built, the production campus just south of the Antelope Valley (14) Freeway is expected to produce 2,854 full- and part-time jobs, and $533 million in annual economic activity countywide.

STOCK OFFERING: Nara Bancorp Inc. netted $82 million from a secondary offering of its common shares that closed Tuesday. The L.A. holding company for Nara Bank said it sold 10 million shares at $7.50 per share, and its underwriter bought 1.5 million additional shares in its overallotment option. Nara intends to use proceeds for general corporate purposes, which may include funding acquisitions, working capital and related regulatory capital needs.

EARNINGS: CB Richard Ellis Group Inc. reported third quarter net income of $12.4 million, down 69 percent from a year ago. Revenue fell 23 percent to $1 billion. … DreamWorks Animation SKG Inc. reported third quarter net income of $19.6 million, 48 percent less than a year ago. Revenue fell 11 percent to less than $136 million. … Avery Dennison Corp. reported third quarter net income of $62.5 million, less than 1 percent lower than a year ago. Sales fell 10 percent to $1.55 billion. … DineEquity Inc. reported third quarter net income of $7.9 million, compared with a loss of $16.4 million a year ago. Revenue fell about 15 percent to less than $334 million. … VCA Antech Inc. reported third quarter net income of $36.4 million, 1.7 percent better than a year ago. Revenue fell 2 percent to less than $339 million. … City National Corp. reported third quarter net income of $8 million, 52 percent lower than year ago. Net interest income rose 5.6 percent to $161 million.

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