Compiled by Julie Leupold
ECONOMIC INDICATORS
Mixed: October employment, which was down by 52,000 jobs from a year earlier but up 8,200 from September, according to the state’s Employment Development Department.
TOP STORIES
A deal could be in the works to sell Dana Point’s St. Regis Monarch Beach Resort. Citigroup Inc., which took over the hotel in July, is looking to sell the hotel at a loss to undisclosed foreign buyers in a deal valued at $245 million to $250 million, according to reports. The buyers would assume the hotel’s $230 million mortgage and pay about $20 million to Citigroup, which holds a $70 million secondary loan on the hotel. Newark, N.J.-based Prudential Financial Inc. and a unit of Seattle-based Washington Real Estate Holdings LLC hold the primary $230 million debt on the hotel. A source told the Business Journal “multiple parties” are interested in buying the hotel in deals valued at more than the $230 million in primary debt.
Santa Ana’s TTM Technologies Inc., a contract electronics maker, agreed to buy the printed circuit board business of Hong Kong’s Meadville Holdings Ltd. for $521 million. The cash and stock deal is expected to close during the first quarter. TTM said the deal would more than double sales and “create one of the largest printed circuit board manufacturers in the world.”
Lake Forest-based construction and engineering company Primoris Services Corp. late last week acquired James Construction Group LLC, a Baton Rouge, La.-based construction company, for $135 million. Primoris is buying James Construction for $7 million in cash, a five-year $53.5 million promissory note and shares of Primoris preferred stock valued at $64.5 million. Incentives could provide James Construction another $10 million in Primoris stock. James Construction will become a subsidiary of Primoris.
TECHNOLOGY
An analyst downgraded shares of Lake Forest disk drive maker Western Digital Corp. on concerns about drive prices falling next year. Bank of America Merrill Lynch analyst Scott Craig slashed his Western Digital rating to “underperform” from “buy.” He cited concerns that the dramatic stock jumps this year of Western Digital and rival Scotts Valley-based Seagate Technology LLC could start to slow.
HEALTHCARE
Mission Viejo nursing home operator Ensign Group Inc. mortgaged six of its facilities to raise $40 million for acquisitions. Ensign, which operates 73 nursing homes and other facilities, struck a five-year loan with a unit of General Electric Co.’s finance arm. Ensign is looking at acquiring long-term care facilities across the western part of the country.
REAL ESTATE
Orange County’s median home price saw its sixth consecutive month-over-month increase in October, rising 1.7% to $436,500, or a $7,500 increase from September, according to San Diego-based MDA DataQuick. Sales declined 1.2% from a year earlier, with 2,800 homes sold in October, down less than 1% from September.
Maguire Properties Inc. was sued for foreclosure by Bank of America Corp. on 2600 Michelson Drive, a 16-story tower near John Wayne Airport. Los Angeles-based Maguire missed $1.7 million in payments in August, September and October, the bank said in complaint filed earlier this month in Superior Court in Santa Ana. The bank wants the court to appoint a receiver for the property who would conduct a sale and attempt to recoup the remaining $95 million in unpaid principal owed by Maguire.
APPAREL
Anaheim-based Pacific Sunwear of California Inc. got hammered with shares down more than 25% last week after the mall retailer forecast a current-quarter loss that at the high end was three times more than Wall Street was expecting. For the three months through January, Pacific Sunwear forecast a loss of $17.9 million to $22.4 million. Analysts had been forecasting a loss of $7 million.
Foothill Ranch-based mall retailer Wet
Seal Inc. also lowered its profit and sales outlook for the critical holiday quarter. Wet Seal, said it expects a profit of $3.4 million to $7.9 million for the three months through January. Wall Street analysts on average had been expecting a profit of $9 million. Wet Seal projected sales of $149 million to $155 million, versus the $156 million analysts had been looking for.
FINANCE
Tustin lender Medical Capital Holdings Inc. faked tens of millions of dollars in billings, using them to cheat investors, the Securities and Exchange Commission charged. The SEC shut down Medical Capital in July for allegedly charging investors $18.5 million in undisclosed administrative fees. In an amended lawsuit filed last week in federal court in Santa Ana, the SEC alleges a far broader and more systematic fraud. The company and its officers have denied wrongdoing.
OTHER NEWS
Costa Mesa-based Mexican fast food chain operator El Pollo Loco Inc. posted a third-quarter loss and slumping revenue as promotions failed to stir business. El Pollo Loco, which is privately held but reports results for debt holders, lost $5 million in the quarter, versus a loss of $48,000 a year earlier. Revenue was down 8.5% to $68.5 million. Same-store sales, a measurement of sales at restaurants open for at least a year, fell 10%.
Ceradyne Inc., the specialty ceramics company and body armor maker, notified nearly 400 workers in Costa Mesa and Irvine that they may be laid off by the end of January. The company said it hopes cuts will be limited to about 100 workers if orders come in.
