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Sunday, Sep 25, 2022

News of the Week

SETTLEMENT: KB Home and two other homebuilders involved in a failed residential project in suburban Las Vegas have agreed to pay lenders more than $250 million to settle litigation. The project, Inspirada, was envisioned as a 14,500-home master-planned community on 2,000 acres in 2004. J.P. Morgan Chase, among about 50 lenders that provided the South Edge LLC joint venture $585 million, later forced the venture into involuntary bankruptcy. KB Home, which owns 48 percent of the joint venture, will pay most of the settlement, which it expects to be between $216 million and $240 million. In return, it will get a 65 percent to 68 percent stake in the underlying land for a future development.

SENTENCING: L.A. tax attorney Matthew Krane, who pleaded guilty to tax evasion and passport fraud in 2009, has been sentenced to 32 months in prison for taking a $36 million kickback federal prosecutors say he received in return for steering media mogul Haim Saban into an illegal tax shelter. The shelter allowed Saban to evade taxes on capital gains of $1.5 billion he made after selling his interest in the Fox Family Channel in 2001. Krane agreed to forfeit $23.1 million to the U.S. Treasury in back taxes and return $17.9 million in illegal fees to Saban. Saban has pledged the money to philanthropic causes.

BACK HOME: Sizzler USA has been acquired in a management buyout that will return the casual restaurant chain headquarters to Culver City, where it was founded in 1958. Sizzler’s worldwide operations were owned by Australian private-equity firm Pacific Equity Partners since 2005. The deal, terms of which were not disclosed, separates 178 owned or franchised Sizzler locations in the United States from about 100 restaurants overseas that Pacific Equity will continue to control. The new ownership team includes Chief Executive Kerry Kramp, who took over in 2008, and former chief executive Kevin Perkins, who will serve as nonexecutive chairman.

PORT TRADE: Traffic at the ports of Los Angeles and Long Beach remained relatively flat last month. Los Angeles handled 360,969 import containers in May, up 5.5 percent from a year earlier. Long Beach had 275,100 import containers in May, a 4 percent increase. Exports at Los Angeles were relatively strong at 15 percent growth, but were down 6.1 percent at the Long Beach facility. Port officials say the slower growth may continue for the rest of the year since 2010 was a particularly strong year.

L.A. INVESTMENT: Real estate investment company Kennedy Wilson paid more than $143 million to acquire a 37 percent stake in a portfolio of five L.A.-area office buildings. The buildings are in Beverly Hills, Miracle Mile, Encino and other submarkets, according to Beverly Hills-based Kennedy Wilson, which did not identify the properties to protect the seller’s identity. The remaining new equity owners are Kennedy Wilson Real Estate Fund IV, Fairfax Financial and LeFrak Organization. The acquisition adds about 700,000 square feet to the company’s more than 50 million-square-foot portfolio.

SOUTH PARK DEAL: In a major win for the L.A.-based streaming video site, Hulu has signed a deal to show episodes of the hit animated TV series “South Park” on its paid-access Hulu Plus site. Subscribers will have access to the 15 earlier seasons of the show, and will be able to view current season episodes 21 days after they air on Comedy Central. Hulu is a joint venture that includes NBC Universal, Fox Entertainment Group, Disney-ABE Television Group and Providence Equity Partners.

ACES HIGH: Federated Sports + Gaming acquired Heartland Poker Tour, which bills itself as the leading “grassroots” poker tour and one of the largest independent producers of poker content on television. Federated Sports is headquartered in Washington D.C. but its main operations are in Los Angeles. The company did not disclose terms of the deal. Heartland Poker, based in Fargo, N.D., is now filming its seventh season, primarily at Indian casinos. It is syndicated to more than 100 million U.S. homes each week, as well as markets throughout Europe, the Middle East and the Caribbean. It was founded in 2005 by entrepreneurs Todd Anderson and Greg Lang. Operations will remain in North Dakota.

ACQUISITION: Gores Group LLC is acquiring nearly all of the assets of Scovill Fasteners, a bankrupt maker of closure products for apparel and industrial uses. Billionaire Alec Gores’ L.A. investment company said the U.S. Bankruptcy Court for the District of Delaware approved the transaction June 10. Terms were not disclosed. Scovill is headquartered in Clarkesville, Ga., and has made snap-closure buttons for consumer and military clothing since 1802.

SPACEX CONTACT: Space Exploration Technologies Corp., a Hawthorne rocket maker, signed a large launch contract with Thai communications company Thaicom Inc. to lift a 7,000-pound satellite into orbit. SpaceX expects to launch the Thaicom 6 satellite in the second quarter of 2013 from Cape Canaveral, Fla. The satellite will be built by Orbital Sciences Corp. of Dulles, Va. Financial terms were not disclosed.

EARNINGS: Korn/Ferry International reported fiscal fourth quarter net income of $20.3 million, 128 percent higher than a year earlier. Revenue rose 16 percent to nearly $206 million. … RealD Inc. reported fiscal fourth quarter net income of $4.5 million, compared with a net loss of $20.9 million a year earlier. Revenue rose 6 percent to $58.5 million. … Cherokee Inc. reported first quarter net income of $3.3 million, 14 percent higher than a year earlier. Revenue fell 16 percent to $6.9 million. … Capstone Turbine Corp. reported a fiscal 2010 net loss of $38.5 million, 58 percent smaller than the previous year. Annual revenue rose 33 percent to $81.9 million. Quarterly revenue was not provided.


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