Compiled by Julie Leupold
TOP STORIES
The Irvine Company is reported to be buying thousands of apartments in Orange County and San Diego County as part of a $1.4 billion deal. The Newport Beach-based real estate investor and developer is buying a 90% stake in area apartments now run by Englewood, Colo.-based Archstone-Smith Trust. The deal stems from the $15.2 billion buyout of Archstone announced in August by Tishman Speyer Properties and Lehman Brothers Holdings Inc. The deal was scheduled to close late last week.
Irvine-based Printronix Inc., a maker of industrial printers, is being bought for $108 million by San Francisco-based private equity firm Vector Capital. The deal will take Printronix, with a recent market value of about $100 million, private. Vector Capital’s is offering 18% more for Printronix than what the company was trading at before the deal. Chief Executive Robert Kleist, Printronix’s largest shareholder, and other executives are expected to own about 10% of the company after the deal closes (see story, page 18).
European Union antitrust regulators are investigating San Diego-based Qualcomm Inc., which is in the middle of a legal battle with Irvine’s Broadcom Corp., for possible abusive business practices. Qualcomm might have violated EU competition rules by refusing to share licensing terms for its mobile-phone technology, EU spokesman Jonathan Todd said. The probe could take as long as two years. Broadcom and other rivals say Qualcomm’s royalty fees for next-generation mobile-phone chips are too high and violate agreements among patent holders to keep costs at a reasonable level.
Shares of Foothill Ranch-based Wet Seal Inc. plummeted nearly 20% last week after the retailer warned about same-store sales for September, October and third-quarter profits. The mall retailer, which operates the Wet Seal and Arden B. store chains for teens and young women, said September same-store sales are expected to come in down 7.5% to 8.5% from a year earlier. Earlier, Wet Seal expected a 1% decline to a 3% rise for the month. Wet Seal cited a slowing in overall sales at its stores and lower-than-expected sales of full-priced items. The company now expects profits to break even in the third quarter or to post a gain of about $1.9 million. That’s down from an earlier forecast of $6.5 million to $9.3 million in profit. Analysts were looking for a profit of about $8.4 million in the quarter. Wet Seal also said it anticipates a 2% to 6% drop in same-store sales for October.
Bear Stearns Cos. is combining Encore Credit Corp., its Irvine-based subprime mortgage division, with its residential mortgage business in Arizona, the company said last week. The restructuring will lead to about 310 layoffs, including an unspecified number of Irvine workers. Bear Stearns officials said the consolidated mortgage unit will be headquartered in Scottsdale, where the company’s Bear Stearns Residential mortgage unit is based. The Irvine office will stay open, the company said. It’s the latest round of mortgage-related layoffs for Bear Stearns, which has pared back its home loan workforce by 40% this year.
Building a six-lane toll road through San Onofre State Beach near San Clemente would cause widespread violations of state environmental laws by threatening endangered species, marring natural resources and compromising recreational space, according to a California Coastal Commission report. The 236-page analysis conflicts with claims by the Transportation Corridor Agencies that the proposed route for the Foothill (241) South Toll Road is the least harmful out of eight alternatives considered by the Irvine-based agency. Estimated to cost $875 million, the 16-mile toll road would begin at Oso Parkway in Rancho Santa Margarita, pass through the state park north of the beach and connect with San Diego (I-5) Freeway at Basilone Road south of San Clemente.
Sales of Orange County businesses more than doubled to 248 in September from a year earlier, reports BizBen.com, the San Ramon businesses-for-sale Web site. That’s even stronger than the 43.5% hike to 1,960 businesses sold statewide during the month and continues an upward trend after a weak July. Sales for the year are still lagging behind last year in OC and statewide.
ECONOMIC INDICATORS
Mixed: Orange County fell to 49th best in a ranking of the nation’s 200 largest metro areas by the Milken Institute and Greenstreet Partners. Back in 2005, the last such study, OC ranked 17th. The county ranked No. 1 among 200 regions for “number of highly concentrated high-tech industries,” which looks at the number of tech industries in a given area.
