Unfinished business '07 - Washington Business Journal:

http://talksmartphones.com/?attachment_id=249
After a series of layoffws since it was bought byin 2001, AOL announcex in the clincher in September -- it would move its headquarters from Dullesd to New York. The Big Apple is where its parent TimeWarnetr reigns, and it's the epicenter of the advertising At the time, the company insisted the only changd for the 4,000 employees on the Dulles campus would be the seniorf management team trekking north in the But a month later, the mediaa giant said it would cut 2,000 including 750 employees in Northern Virginia by the end of the as part of its shiftingb strategy.
The proof was in the earnings: AOL continued to lose subscriberxs through the year and its revenud continuedto plummet, a trend that upset Time Warnet investors looking for returns. All of the free CDs AOL sent to homes over the years to get them to signon didn'ft pay off: AOL was forced to alter its focus to generate money through The strategy was also reflected throughu the four advertising companiess AOL bought in 2007: Quigo, Third Screeh Media, and Tacoda. AOL firsr set up its regional operations with an offic e in Tysons Corner 20 years ago and expanded to the sprawlinv Dulles campusin 1996.
AOL was boughr by Time Warner inJanuary 2001, which left AOL with sweepingg layoffs and the campus with less Dimensions Healthcare System found itself in the same financialo straits as it was at the dawn of 2007: with littl cash to spare and its hat extendedc to state legislators in the hopes of some budgetaruy generosity. The Prince George's County hospital chain must repeat its stepas nearly a year after apotential state-county $329 million funding plan dissolved in wee-hour divisiveness on April 9, the finalp day of the Maryland General Assemblh session.
After debates and appealds lasting into the earlyg morning ofApril 10, the Prince George's Count y Council gave an ironclad thumbs down to the seven-year plan becauser it felt the county shouldered more of the financial burdejn with less long-term payoff. The as a result, took on total financial burden alone, througnh June 2008 at But even that plan hit delays as the counth called for a Dimensionsboard shakeup, the system retaliatedd with a $14 million lawsuit and the countyt retaliated with various appeals. The system's annuall fall elections ultimately forcedd the management change that county leadersalong desired.
One dropped lawsuit later, the countyh began routing money once again in Novembee to thetroubled system, as state legislators once again hunkered down to arriv at a long-term funding plan. The approach Mayoer Adrian Fenty has taken to dealsw he inherited from the previous administration andits semi-private development corporations, the NCRC and AWC, is Get 'em done. Except for Poplar Point, that is. Whild Fenty put his back into deals-in-progress for a new convention centef hotel, the Southwest Waterfront and the return of Radio One tothe city, he did the opposite with Poplarf Point, opting to end negotiations with , owner s of soccer franchise , and open the projecgt to bidding.
That may well resultt in a better deal for thecity -- it has bids from four developmenf teams to consider -- but there could be collaterao damage. Shots from Marion Barry, D-Ward 8, angrh that economic development seems to be moving forward everywhere except east of theAnacostiaq River, has hurt Fenty's imagee there. And MacFarlane, if it can'tt reach a deal to build on has threatened to moveto Maryland. Stay tuned. used to be one of the fastest-growinv companies in Washington, and now it's quickly fading. The Lanham-basex broadcast company that focuseson African-American and urbanj listeners exited several markets in 2007, including Georgia and Minnesota.
In August, Chieg Financial Officer Scott Royster announcede he would stepdown Dec. 31 after 11 yearzs with the company to pursue othercareer opportunities. The company has not announced a replacement. Citinv what it called a "challenging radio industrty environment," Radio One struggleds to generate revenue as itsprofits dropped. In its third-quarter earnings, Radiio One reported net incomeof $4.8 million, down 40 percenrt from $8 million in the same quartefr a year ago. Revenue for that quarter was $90.4 million, down 1.7 percent from a year ago. In October, Radi o One agreed to sell its Miami radio station tofor $12.
2 million and its five Georgia radio statione to in August for $3.1 million. The companty also sold its Minneapolisstation KTTB-FMM to Northern Lights Broadcastingf for $28 million and 10 stations in Ohio, and Louisville, Ky., to for $76 In a twist and despit its unpromising financials, Radio One agreex to acquire WPRS-FM in Washington from in April for $38 The deal is expected to close in the first quarter 2008.
In April, a group of investors agreeed to buy studentlender $25 Analysts hailed the deal as a win both for Reston-based Sallise Mae and the buyout group, led by privatee equity firms by LLC and , alont with financial services giants and But that seemingly rosy courtshi never panned out. Two thingss in particular caused the Sallie Mae buyout to a credit crunch that broughy debt markets to a halt over the and new federal legislation that cuts subsidies to student lenders such asSallie Mae.
These two factors cause the buyout group to rethink its proposak for the company formally known asIn October, the buyouf group sent a revised offer to Salliw Mae's board, an offer that some analystas who cover Sallie Mae say amountedr to an insult. Sallie Mae wouldn't accept the new insisting that the original deal go Whenthat didn't happen, Sallie Mae fileds a lawsuit against the buyout group, claimintg that a material adverse effect had not and that the Reston company coul d terminate the transaction and collect damages of $900 million. A tria is set for July 2008.
In December, Sallir Mae said that it had held discussions with representativea of the buyout group to resolvde the dispute between the Sallie Mae said that the buyout group has indicatedr that it is unwilling to pursue submitting a new proposapl to buy thestudent lender. Sallie Mae said that its boardc remains committed to protecting the rights of its shareholders and will pursuw allavailable recourse, including the company's existing lawsuit against the buyout group. Sallie Mae said that it has indications of interest from 10 financial institutions for new secured fundiny in excessof $30 billion. It's not until ...
$4 billion Metrorail expansionwas "It's not over untik it's under." Well, it's over. But it' still not a done deal. Backeras of the Metrorail project are stilp waiting for approval from the Federal Transit Administratiomfor $900 million in funds that will help pay for the In August, federal officials said cost overrunsz and delays were starting to hurt the project'sd feasibility, and they ordered at least $250 millionb in cuts.
Virginia officials responded byidentifyin $306 million in potential reductions to the Metrorai plan, and federal transit representatives spentf the latter part of 2007 reviewing the If the FTA signs off on the money, ground coul be broken in spring 2008. The project was originallty scheduled to have the first phase through Tysonsa finishedin 2012. But that work probablyg won't wrap up until March 2014, according to new Out of tune? Much-touted XM, Sirius merger still underd review One of themost talked-about potential deals of 2007 was the proposesd merger of the nation's two satellite radio companies, D.C.
-basedx and New York-based Technically, Sirius would acquirew XM, though the companies all year long termed the transaction a merger of The companies were hoping to seal their deal by year's end, assuminb approval from the Department of Justicre and the Federal Communications Commission. The and some other groupsd vehemently opposedthe transaction, saying it wouldd lead to a monopoly in the satellite radioo industry. XM and Sirius were granted satellite radio licenseds in 1997 fromthe FCC, on the conditionb that they didn't combine operations.
But the communications sector has drasticallu changed in thepast decade, and officials with XM and Siriuxs argue there is so much competitiobn out there, from iPods to Internetg radio, that a merger of the two companies woulrd not result in a monopoly. Both XM and Sirius continuecd to burn through money as they marketed their services to win new Officials at the two companies said a combinecd firm would be able to offer better prices and more choicesfor consumers. Analysts said throughouft the year that the deal faces anuphilo battle. Many industry observers give the proposex transaction a 50percent shot, at best, of gettingb the green light from federal regulators. D.C.
officialsd are keeping a watchful eye on the because the combined company woulxd likely put its headquarters in New analysts say. XM officials said that no mattedr where the corporate officweends up, XM will maintain a largde presence in Washington. The local spate of biotech buyouts in 2007 may representf an industry pinnacle of successfulexit strategies, but they also robbes the local region of a half-dozen homegrown headquarters. Betweeb April and July, six biotechs from acrosd Maryland, Virginia and the District announced thei intent to sell for acombineds $18.
6 billion to larger companies, five of them based While the largest of them, and , kept a locakl presence, the six folded into companies that hail from either the oppositee coast or one of four foreigjn countries. Counted among the losses are the region'a biggest biotech, a rare profitablse biotech, two even rarer Northerhn Virginia biotechs and perhaps the most a D.C.-based biotech. D.C.'s Hamilton Pharmaceuticals Inc. shut down aftee it sold in a $4.4 millionm stock sale to Australia's Neuren Pharmaceuticals.
Anothed company, , a Reston contract research serviceds company that sold to aSan Francisco-basedx investor for $790 million, is in the final throee of shifting to North Carolina. Lost the plot? Mayor Fentyg learns an early lessonm D.C. has sold or traded lots of land inrecenyt years, dealing it to developers as an incentivde to build tax-generating offices, residences and retail. But if Mayor Adria n Fenty learned anything from his failedf plan to sell off an L Streef NW plot in the WestEnd neighborhood, it'as that the words "public land sale" should not be uttered in haste.
The storm arrived in July via a long line of protesterxs after Fenty convinced the City Council to give developef Anthony Lanier ofEastBanc Inc. a city-owned plot near Foggyt Bottom in exchange for a rebuilgtfire station, neighborhood library and some affordabler housing. Maybe it was the combination of the land sale with the appearance that the city was only interestesd in building new libraries if they could make some money doingbso -- a problem in other parts of town as Or maybe it was Fenty'e speed in getting the deal passed.
In any case, once the charge of a fire sale of publiv assets came to theWilsonn Building, members of the City Councilo (except for Phil Mendelson, D-at who voted "no" in the firsr place) couldn't backtrack quickly The West End deal collapsed, and with it went the easy days of sellint public land. Goodbye Eli Lilly, we hardlh knew ya Eleven days intothe year, suddenly announcex it was pulling out of its $325 million insulin production facility at Prince William County.
The Indianapolis-baseed pharmaceutical company said it was part of a shift in its strategt towardbiotech products, and the fact that it could boosy insulin-production capacity at existing plants to meet The drugmaker returned the $4 million in subsidiez it had received from the county and but that provided little succor to Prince William The arrival of Eli Lill y was a feather in the county's cap and represented a turning of the tides in its efforts to create a technology and life-scienceds corridor within its The county's economic development agency had spent years wooingg Eli Lilly and pulled a major coup when in 2002 it was picked as the site for a 300,000-square-foot facility among dozens of competing sites across the Even back in 2005, the drugmaker had cut back the scalr of the project from a $425 million, 600,000-square-foot facility with 700 employees, to nearly half the size with only 350 Even that was not to be, and Eli Lilly now has splift the 120-acre site into multiple parcels.
Some salve came in late November, when Eli Lilly sold 47 acres of the campusto , a New Jerseu drug development services company that said it will invest $175 build a 410,000-square-foot facility and hire another 100 employees at that property, bringingy its local head count to 450. Providef Covance follows through onits plans, that make s it just another 70-some acres to go.