Early Briefing: A Gut-Wrenching Ride
Staff writer Alejandro Lazo checks in on Washington's 20 largest public companies in the Post 200 to see how they are faring this year -- and judging from their collective stock performance, it is not a pretty picture.
Given the turmoil, however, two names jumped out: Capital One, up 12 percent for the year, despite the credit meltdown, and NVR, the giant homebuilder, up 17 percent. Both outpaced the only other two companies to show gains: Lockheed Martin, up 8 percent and Washington Gas's parent WGL, up 5 percent.
See Alex's full report here.
In other news:
* As leaders in Congress Sunday released the details of a proposed $700 billion bailout of the financial industry, the issue weighed on the minds of people across the Washington region. They voiced a range of emotions: anger, apprehension, relief, hope and doubt, according to this story in the Metro section.
Some had worries about financial fallout in their own lives. Others were concerned about issues of government oversight and the size of the cost involved. They wanted to know exactly why the crisis happened and whether the bailout is a long-term fix.
Carlos Aulestia, 46, a Rockville toy store owner angry that the economic crisis has brought his business its slowest weeks ever, was hoping the proposal would end the downturn.
Aleena Hampton, 61, a retired federal employee in Alexandria, was wary that the massive rescue package was only a "Band-Aid" solution but acknowledged that the government needs "to do something."
Jim Dinegar, president of the Greater Washington Board of Trade, described a wave of relief among the mid-size and large businesses his organization represents in the region. "The nation dodged a bullet," he said. "This is as serious as it gets."
* Staff writer Miranda Spivack reports that when Montgomery County Council members today examine a plan to bring Live Nation to downtown Silver Spring, they will be considering a deal unlike any the county has made before.
Until now, Montgomery has funded only nonprofit arts and entertainment organizations, usually by constructing their buildings, acting as their landlord, and making grants to keep them afloat. It has not directly subsidized a for-profit enterprise such as Live Nation, a publicly traded entertainment company that had $4.18 billion in revenue in 2007.
Nor have county officials before asked the planning agency to put aside customary oversight of new development and approve part of a project without seeing the whole. The council and the state legislature already have agreed to spend $8 million in public funds to build a music hall for Live Nation to hold rock-style concerts for about 2,000 standing patrons at the Colesville Road venue. The next step is for the council to approve a zoning change, which members will begin debating today.
A council majority appears to have coalesced around the plans, although some still have questions.
The deal requires the county and state to pay to construct the $8 million building. The county would own it and rent it to Live Nation for $7,500 a month. Live Nation would spend about $2 million outfitting the inside of the hall, which they are dubbing Fillmore Silver Spring. Lee Development Group would donate the former J.C. Penney facade and land, worth about $3.5 million.
* When Motorola's $6 billion global satellite phone system, Iridium, went belly-up eight years ago, few saw it as anything more than a whopper of a waste of good technology on the wrong application.
A small group of investors eventually rescued Iridium by offering $25 million for it, at a half-cent on the dollar. They changed its business plan and shifted its focus to selling communications services to research, defense, shipping and aviation entities instead of corporate travelers, earning profits since 2005.
The turnaround apparently sparked interest in the Bethesda company.
Last week, Iridium announced an agreement to merge with an affiliate of New York investment bank Greenhill & Co., a transaction that will give the sat-phone firm a $500 million cash infusion and allow it to wipe nearly $150 million in debt from its books. The deal, which must be approved by regulators, is scheduled to close in early 2009. It would clear the way for Iridium to begin building and launching a new generation of satellites to replace the 66 aging ones that are orbiting 485 miles above the Earth. The new constellation is projected to cost $2.7 billion, Iridium officials said.
"This is the transaction that ensures the future of Iridium," said chief executive Matt Desch. "We don't need anything more in equity or debt financing until about 2014."
* David M. Mott, former chief executive of MedImmune, is pushing Washington to become one of the nation's top biotechnology hubs.
Mott began his career in finance, as a Wall Street investment banker. Now, after 16 years at MedImmune, the darling of the local biotech scene, he's come full circle. This month he started his new job as a general partner at New Enterprise Associates, a Chevy Chase venture capital firm, financing and growing biotech and specialty pharmaceutical start-ups.
"I want to help give birth to the next generation of MedImmunes," he said.
* Staff writer Michael Laris writes about the debate over redeveloping McLean: What's better for the community, he asks -- a new "Main Street" developed by a McLean resident who heads a multibillion-dollar construction company that built the Reston Town Center and Nationals Park, or the creaky, weathered stores that have built loyal followings over decades? Is McLean, where the Little League field remains a prime gathering spot, ready to become more like Bethesda? And how do you please everyone in a place where so many people are used to getting what they want?
Adding to the unease, the developer has not made his plans public or offered shop owners any assurances that they will have a home in the new McLean.
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