Stories in this week’s Orange County Business Journal
TOP STORIES
Shares of Orange County’s three publicly traded nursing home companies plummeted late last week on news of a possible double-digit Medicare payment cut. Irvine-based Sun Healthcare Group Inc.’s shares fell 13% to a market value of about $300 million on Friday. Shares of Foothill Ranch’s Skilled Healthcare Group Inc. were down 13% to a market value of $470 million. Mission Viejo-based The Ensign Group Inc. was down 11% to a market value of about $590 million. The Centers for Medicare and Medicaid Services is proposing two possible changes to how it pays nursing homes, including one that could result in an 11% Medicare rate cut for homes starting Oct. 1. Regulators said the proposal provides for what it called an unexpected spike in nursing home payments in the 12 months ending Sept. 30. The other method would provide a 1.5% rate increase.
Billionaire Henry Samueli has upped the ante to bring the National Basketball Association’s Sacramento Kings to Anaheim with an offer to buy a minority stake in the franchise. Samueli is cofounder of Irvine-based Broadcom Corp. and owner of the Anaheim Ducks and the company that runs the city-owned Honda Center. He has offered to increase a personal loan of between $50 million to $75 million to the Kings and to buy a part of the team, according to the Sacramento Bee. Samueli has also agreed to put as much as $70 million into upgrades for the Honda Center to meet NBA standards. Samueli’s latest moves come as NBA owners raise questions about the Kings and the team faces a deadline this week on filing a request to move (see related story, page 1; item, this page).
TECHNOLOGY
Aliso Viejo-based QLogic Corp., a maker of electronics for data storage networks, has tapped Jean Hu as chief financial officer and senior vice president. She fills the post vacated last year by Simon Biddiscombe, who was promoted to chief executive (see related OC 50, page 25). Hu will report directly to Biddiscombe in her new role. She most recently was finance chief and treasurer of Newport Beach-based Conexant Systems Inc.
HEALTHCARE
A Virginia federal court jury ordered Irvine-based drug maker Allergan Inc. to pay $212 million to a man who said he got permanent brain damage after being injected with Botox to treat cramps and tremors in his hand in 2007. Allergan hasn’t yet decided whether to appeal the verdict and called the finding by the jury “inconsistent with Allergan’s past and current actions to properly warn physicians and patients about the potential risks of Botox.” Botox has various cosmetic and medical uses, including treatments for some cramps and chronic migraine headaches, among others.
Garden Grove-based medical test maker Hycor Biomedical Inc. is moving its headquarters from Garden Grove to an undisclosed location in central Indiana, according to a report in the Indianapolis Star. Hycor was once among Orange County’s smaller publicly traded companies before a sale to a private equity firm last year. The company was offered up to $640,000 in performance-based tax credits by Indiana state officials, according to the Star (see story, page 8).
MARKETING
Irvine-based Vizio Inc. has signed Los Angeles Clippers star Blake Griffin to pitch its flat-screen TVs and other products. Terms of the deal were not disclosed, according to the Sports Business Journal. Vizio has a marketing strategy of tapping high profile athletes and entertainers to tout its products. It spends millions a year on branding and last year signed a three-year deal to be the presenting sponsor of the Rose Bowl from 2011 to 2014.
TRANSPORTATION
The public body that oversees the San Joaquin Hills (73) Toll Road will consider extending its term for six years to 2042. The Transportation Corridor Agencies opened the toll road in 1996 under a plan that would use tolls to pay for bonds raised for its construction. The initial plan called for it to revert to a free public thoroughfare in 2036. Talk of an extension comes as toll revenue continues to fall short of initial projections.
OTHER NEWS
Federal authorities have charged the owners of Costa Mesa computer company Online Micro LLC with illegally exporting goods to Iran in violations of government sanctions. Massoud “Matt” Habibion and Mohsen “Max” Motamedian were arrested and released on bond after surrendering their passports to authorities. Habibion has denied the charges.
David Aleman of McDonald’s in Stanton won the Ray Kroc Award as one of the top managers of the fast-food chain’s more than 30,000 restaurants worldwide.
ECONOMIC INDICATORS
UP: Rents in Orange County, where the first-quarter average asking price at complexes with more than 100 apartments rose by $28, or about 2%, from a year earlier to $1,506, according to a survey by San Francisco-based researcher RealFacts. The survey found the vacancy rate for large complexes at 5%, unchanged from the prior quarter and down from 6.4% a year earlier.
