Review & Preview
Take That!: In the second of what area charities no doubt hope will be a spate of large gifts from entertainment moguls, Walt Disney Co. Chairman and Chief Executive Michael Eisner was set to announce a “major gift” to Cal State Northridge May 20. Exact figures were not available last week, but the value was said to substantially less than David Geffen’s recent $200 million gift the UCLA’s medical school.
Second Best?: After failing to come to terms on a cross-platform ad buy with Viacom, OMD, the media buying unit of Omnicom Group Inc., opened talks with Walt Disney Co. to place more than $1 billion of advertising across its properties. If the deal goes through, OMD clients like PepsiCo Inc. and Gillette Co. would advertise their products on several Disney outlets, including the ABC-TV network and ESPN.
Taxing Concern: Disney disclosed that the Internal Revenue Service was auditing its income tax returns for 1993 through 1995 and that it expected challenges to some of its tax positions. Disney said it was in compliance with tax laws and would defend any challenges.
Stake Shake: Leonard Tow, chief executive of Citizens Communications and the largest non-family stakeholder in Adelphia Communications Corp., demanded a seat on the board of the troubled company. Tow, who sold his L.A. cable franchise to Adelphia, controls 12 percent of its Class A shares. Adelphia has put the L.A. franchise up for sale to cut its debt load. Later in the week, Adelphia’s founder, John Rigas, said he would step down as chief executive.
Earnings Tally: Real Estate Investment Trust Macerich Co. reported pro rata first quarter earnings of $6.3 million, compared with $6.1 million for the like period a year ago. Troubled Homestore.com Inc. reported a first quarter net loss of $34.8 million, compared with a loss of $99.8 million for the like period a year ago.
Domino Effect: Gemstar-TV Guide International reported a net loss of $208 million for the first quarter ended March 31, compared to a net loss of $3.9 million in the like-year earlier quarter. The company, in the midst of accounting adjustments, projects that it will take an impairment charge for goodwill of $5 billion. The news hammered News Corp., which has a 21 percent stake in Gemstar. The company last week took at $4.2 billion writedown it associated largely with its investment in Gemstar, resulting in a net loss of $4 billion, compared to net income of $111 million a year ago.
Room Tax: Confirming the worst fears of some and giving hope to others, City Council’s chief legislative analyst, Ron Deaton, proposed a non-profit corporation be created by the city to fund a 1,200-room, $280 million convention hotel downtown. In a report, he proposed that the hotel be financed by tax-exempt bonds, which would be repaid by the revenues it generated. The hotel would be built at the southeast corner of Olympic Boulevard and Georgia Street.
Caps Continued: Federal price caps on electricity introduced during the height of last year’s power crisis are likely to be renewed this fall, according to regulators. The feds pulled back from their preference to end price caps with the disclosure last week of memos from Enron Corp. officials about manipulations of California’s energy market.
Right at Home: The median price of a Los Angeles County home rose to a record $254,000 in April, according to DataQuick Information Systems, a jump of 18 percent over the year-earlier period. Sales were up 26 percent compared to April 2001, and last month was the busiest April since 1989.
Budget Season: County budget hearings, which commence this week, continue throughout next week. Public hearings will be held every weekday at the Kenneth Hahn Hall of Administration. Starting times vary. Information: http://bos.co.la.ca.us.
Trade Week: The World Trade Week Luncheon and Trade Fair will be held Tuesday (21st). Luncheon talk topic will be “What’s Next After the Alameda Corridor?” The program is sponsored by the Foreign Trade Association of Southern California and Women in International Trade, Los Angeles. Information: 323-730-1011.
Civil War: On Wednesday (22nd), the Local Agency Formation Commission will meet; agency commissioners are widely expected to place a measure for the San Fernando Valley to secede from the City of Los Angeles on the Nov. 5 ballot.
Starring Role: The rise and fall and subsequent rise of producer Robert Evans will be chronicled in a movie opening in June based on his autobiography, “The Kid Stays in the Picture.” Evans gets his star on the Hollywood Walk of Fame on Thursday (23rd). As head of Paramount in the 1970s, he helped bring the studio back from the brink with such movies as “The Godfather.”
Gross Calculation: Preliminary Gross Domestic Product figures for the first quarter are due Friday (24th). Estimates are that GDP will climb by 5.8 percent, the same increase reported in the fourth quarter of 2001. New home sales data for April is also due on Friday, with analysts estimating a slight increase over March figures.
Warhol’s Works: The Andy Warhol Retrospective begins its only North American appearance at the Museum of Contemporary Art on Saturday (25th), 250 S. Grand Ave. The exhibition contains more than 150 of Warhol’s paintings, drawings and sculptures from the early 1940s through 1986. Warhol’s works get more than just 15 minutes of fame. They’ll be on display until August 18.
Triple Threat: After dispatching the San Antonio Spurs in five games, the Lakers bid for their third consecutive NBA championship continues this week with games in Sacramento Monday (20th) and then back at Staples Center Friday (24th) and Sunday (26th).