Compiled by Julie Leupold
TOP STORIES
Irvine-based Freedom Communications Inc., owner of the Orange County Register, other papers and TV stations, filed for bankruptcy reorganization in a Delaware court. Freedom is set to pursue a bankruptcy plan that would cut its debt from $770 million to $325 million and turn over nearly all of the company to lenders.
Abbott Laboratories is buying Irvine-based Visiogen Inc. for $400 million in cash. Chicago-based Abbott’s buy of Visiogen, a maker of replacement eye lenses, is its second major eye device deal here this year. Abbott spent $2.8 billion earlier this year on Santa Ana’s Advanced Medical Optics Inc. Abbott said it expects the Visiogen deal to close in the fourth quarter (see story, page 3).
TECHNOLOGY
Insurers agreed to pay $118 million to Broadcom Corp. as part of its settlement of a lawsuit accusing officials at the chipmaker of mismanagement and unjust enrichment through the misdating of stock options. The settlement doesn’t cover cofounders Henry Samueli and Henry “Nick” Nicholas, who have face federal indictments in the case. The insurance money partially reimburses Broadcom, which spent more than $130 million on legal defense for its executives and directors. Broadcom also is paying $11.5 million to plaintiffs’ lawyers in the suit. The defendants admitted no liability. Broadcom said it settled the case to avoid additional costs.
TTM Technologies Inc., a maker of circuit boards for networking gear and the military, is closing two California factories and moving some of the work to its Santa Ana headquarters. TTM is closing its Hayward and Los Angeles facilities “due to continued weak demand in North America for commercial printed circuit boards and backplane products.” The move is expected to save about $14 million per year, the company said. The circuit board production that was done in Los Angeles is set to be transferred to factories in Santa Ana, Utah and Wisconsin.
Aliso Viejo-based Quest Software Inc. has taken out cash by mortgaging its headquarters in a deal valued at $34 million. The company had owned its two-building headquarters complex after paying $32.6 million for the buildings in two deals in the middle of the decade. Quest’s loan on the building is at 7%, according to the Newport Beach office of Chicago-based real estate finance company Cohen Financial LP. The company wasn’t under pressure to finance its building: Quest had cash and short-term investments of $331 million at the end of June, up from $310 million at the end of March.
HEALTHCARE
Spectrum Pharmaceuticals Inc., an Irvine drug maker, got regulatory approval for an expanded use of a cancer drug. The Food and Drug Administration approved Spectrum’s Zevalin as an early treatment for patients with non-Hodgkin’s lymphoma, a blood cancer. The drug previously could be used only for patients whose tumors did not respond to other treatments. Spectrum plans to hire more sales representatives for Zevalin, with a goal of relaunching it later this year.
State regulators fined Children’s Hospital of Orange County $25,000 because nurses there failed to ensure appropriate drainage after a child’s neurological procedure in November, an oversight that led to a severe brain injury. Hoag Memorial Hospital Presbyterian in Newport Beach was fined $25,000 for failing to continuously monitor a patient who was disconnected from a cardiac monitor for 34 minutes. The patient later died. South Coast Medical Center in Laguna Beach also was fined $25,000 for not following proper surgical procedures.
APPAREL
Huntington Beach-based clothing maker Quiksilver Inc. reported results for the recently ended quarter that met or beat Wall Street expectations, but it warned of a surprising loss for the current quarter, sending its stock plummeting. For the three months through October, Quiksilver forecast a loss “in the mid single digits” per share, or about $6 million, driven in part by higher interest expenses from a recently reworked loan and credit lines. Analysts had been looking for an adjusted profit of $12 million. For the recently ended quarter, Quiksilver met expectations with a $3.7 million operating profit. Sales of $501.4 million surpassed the consensus Wall Street forecast of $480 million.
August same-store sales at Foothill Ranch-based mall retailer Wet Seal Inc. fell a deeper-than-expected 11.2% versus a year earlier. Analysts were expecting a 9.5% drop in sales at stores open at least a year. The seller of clothes for teen girls and young women blamed a slower back-to-school season and later Labor Day.
OTHER NEWS
Fountain Valley-based Hyundai Motor America Inc., Kia Motors America Inc. of Irvine and other automakers with operations here saw auto sales rally in large part because of the government’s $3 billion “cash for clunkers” program. Hyundai, part of South Korea’s Hyundai Motor Co., saw a 47% gain in vehicle sales last month
from a year earlier and set a sales record for the company. Kia, sister company to Hyundai, also saw a record August with sales up 60% from a year earlier. Irvine-based Mazda North American Operations reported its best month for the year with sales up 12%.
