Review
November 22-27
Dying Merger: Hughes Electronics Corp., owner of the DirecTV service, may end a $26 billion agreement to be acquired by EchoStar Communications Corp. unless regulators approve the sale by Jan. 6. El Segundo-based Hughes and Littleton, Colo.-based EchoStar asked the Federal Communications Commission to quickly reverse a decision rejecting the merger. Hughes has the right to halt the deal unless the agency approves it by Jan. 6 and the merger is completed by Jan. 21. The FCC and the Justice Department oppose the purchase.
Piracy Ruling: Movie studios can’t sue a former Indiana college student in California courts who posted software on the Internet that opened encrypted DVDs, the state Supreme Court ruled in a decision that may complicate how the entertainment industry pursues potential copyright violators. The state’s high court rejected the studio’s argument that because the entertainment industry was most harmed by Matthew Pavlovich’s software, the student should have to face a civil lawsuit.
Suit Settled: ICN Pharmaceuticals Inc. settled a lawsuit by the Securities and Exchange Commission that charged the Costa Mesa-based drug maker with making misleading statements about its products. The company will pay civil penalties of $1 million to resolve the suit, which was filed in 1999 and alleged that ICN misled the public about the status of regulatory approval for its Ribavirin drug as a sole treatment for hepatitis C.
Weider Sale: The owner of the National and the Star will buy Woodland Hills-based fitness publisher Weider Publications for $350 million. American Media Inc., which has been bidding on the publishing company since September, will acquire titles that include Shape, Men’s Fitness and Muscle & Fitness. The deal, which requires regulatory approval, is expected to close early next year.
Hertzberg News: Robert Hertzberg, Speaker-Emeritus of the California Assembly, will join the L.A. office of Mayer Brown Rowe & Maw as a partner in the government relations practice. Hertzberg will be working with companies, especially overseas, to complete government approvals and regulations.
Money Management: The University of California plans to hire outside managers to invest $13.8 billion of U.S. stocks for its pension and endowment funds because its own staff failed to beat benchmark indexes over the past 10 years. Winning the California contracts would be a boost for fund management companies after almost three years of stock market declines. California’s move follows New Jersey’s decision to force out the head of its investment division after the state’s pension fund lost $6 billion in the last quarter.
Utility Projects: Edison International says its 2003 earnings are expected to fall to a range of $1.40-$1.60 per share, from 2002 operating earnings of $1.80 to $1.90. The expected earnings decline by Edison, parent of Southern California Edison, is the result of a weak performance at its unregulated energy-trading subsidiary, Mission Energy. Edison had warned investors that 2003 earnings would be lower.
Cheap Gas: Wholesale gasoline prices on the West Coast continue to slide as higher refinery production boosts supplies. Most West Coast refineries are operating close to normal levels after resuming production following outages. The stepped-up output has helped lift West Coast gasoline stocks at a time when demand from motorists has been little changed or weaker. In Los Angeles, reformulated 87-octane gasoline for five-day delivery fell 0.5 cents, to 79 cents a gallon, the lowest price since April 15, according to Bloomberg data.
Preview
December 2 – 8
Earnings Trickle: Korn/Ferry International, a late entrant to the recent earnings season, is set to report second quarter numbers this week. The company is expected to post a loss of 3 cents per share, compared to a loss of 4 cents in the like-year earlier period.
Anchor Talk: ABC News anchor Peter Jennings, co-author of a new book, “In Search of America,” chats it up with satirist Harry Shearer on Monday (2nd) at the Skirball Cultural Center in a program co-sponsored by Writers Bloc. Tickets are $15. For information: 310-335-0917. NBC News Anchor Tom Brokaw, currently on book tour with his latest work, “A Long Way From Home: Growing Up in the America Heartland,” speaks on Wednesday (4th) at the Pasadena Civic Auditorium as part of the Distinguished Speaker Series of Pasadena. Tickets range from $40-$52. For information: 626-449-7360.
Sports Beat: The college football bowl picture should become clearer after UCLA finishes up its season on Saturday (7th) against Washington State. If the Cougers beat the Bruins, they’re in the Rose Bowl and USC most likely gets stuck in a second or even third tier bowl game. On the NBA front, the Lakers are home against Memphis on Tuesday (3rd), Dallas on Friday (6th) and Utah on Sunday (8th). The Clippers are home on Wednesday (4th) against Miami and Saturday afternoon (7th) against Minnesota. The Kings are at home on Thursday (5th) against Nashville and Saturday (7th) against Colorado.
Silly Golf: Tiger Woods, Phil Mikelson and Vijay Singh will headline the Target World Challenge Dec. 5-8 at Sherwood Country Club in Thousand Oaks, one of those invitational golf tournaments that’s considered part of the “silly season” because it’s not an official tour event. Tickets range from $25 for a single day (Thursday-Friday) to $75 for all four days. For information: 714-816-1806.
Econ News: November jobless numbers are due on Friday (6th). Last month, the nation’s jobless rate edged up to 5.7 percent from 5.6 percent the month before. California reports state and county data the following Friday. Otherwise, it’s a relatively quiet week.
Cut Rate: On Friday (6th) Gov. Gray Davis is set to release his plan for $5 billion in immediate cuts from the state budget, which faces at least a $6 billion deficit for the current 2002-03 fiscal year and at least a $15 billion deficit for the 2003-04 fiscal year. The state Legislature will take up Davis’ planned cuts at a special session, which convenes on Dec. 9.
Hospital Plan: Beleaguered Tenet Healthcare Corp. will face analysts and investors on Tuesday (3rd) with a new pricing and growth strategy following controversy over its Medicare billing practices.
