Private equity shows know no passion for products and services, it simply demands a high rate of return with little consideration to anyone or anything else.
Harry & David (Wasserstein & Co.) and Guitar Center (Bain Capital) are local examples of what happens once private equity firms sink their teeth into an otherwise good thing, generally founded by entrepreneurs who had a passion.
Private equity seeped into the banking industry during the throes of the Great Recession. Sterling Financial Corp., Cascade Bancorp, and SKBHC Holdings, among others saw massive infusion from funds looking for big returns.
Private equity likes to acquire, gut, and sell.
When Umpqua Holdings acquired Sterling Financial a pair of private equity investors needed to sell their shares in order to realize their goals. That meant Umpqua had to authorize the sale of 15 million shares worth $243 million.
Those funds, no doubt, will be used to acquire other businesses or assets; jobs will be lost and more profit extracted.
SKBHC Holdings LLC, which operates AmericanWest Bank, which assumed control of PremierWest Bank in April 2013, is now looking for payday of its own.
Financial news service Bloomberg reported last week that SKBHC, which is backed by Goldman Sachs Group Inc. and Oaktree Capital Management LP, is considering a sale or initial public offering after being approached by a potential buyer.
According to Bloomberg, SKBHC received unsolicited interest from Irvine, California-based Opus Bank. Its banking assets could sell for as much as $700 million.
Bloomberg said Private equity-backed banks that raised money during the downturn have been increasingly seeking to sell or go public to return money to investors. CIT Group Inc. agreed to buy OneWest Bank, backed by billionaires John Paulson and George Soros, for $3.4 billion this month.
SKBHC Holdings CEO Scott Kisting, the one-time co-head of global banking for Merrill Lynch & Co., raised $750 million from GS Capital Partners, and other investors including Oaktree in 2010 to buy failed U.S. banks.
SKBHC paid $6.5 million for the assets of bankrupt AmericanWest Bank in 2010. It bought PremierWest for $20 million, plus paying off the defunct institution’s $41.4 million government TARP loan.
Boeing had a big July with 324 orders, the most ever in a single month.
Demand for Oregon products hasn’t kept pace with the rest of the country, following the Great Recession.
An economic analysis by Beacon Economics found the state’s share of total U.S. exports has declined in recent years.
During the decade prior to the downturn,1997 to 2008, Beacon Economics discovered Oregon’s average real growth for exports was nearly 7 percent annually compared to just over 4 percent nationally. However, post recession, Oregon’s export growth has averaged just 2 percent annually versus 3 percent in the U.S.
The findings based on data extracted from Foreign Trade Division of U.S. Census Bureau, show Oregon’s export share fell from 1.5 percent in 2008 to 1.2 percent.
Authors Partner Christopher Thornberg and Eric Meux point to reduced personal computer demand as a key element in the decline. Semiconductors from Intel Corporation are one of highest valued exports for the state, and as the popularity of smartphones and tablets has increased demand for PC chips, particularly from China, Oregon’s largest trading partner, has dampened, they said.
On a more positive note, during the first five months of 2014, Oregon’s exports increased in real terms by 14 percent over 2013 exports, surpassing the national figure of 3.3 percent.
Meanwhile, consumers apparently are brimming with confidence.
The Conference Board Consumer Confidence Index increased in July with the Index rising to 90.9 (with 1985 serving as the bench-mark 100), up from 86.4 in June.
The Present Situation Index increased to 88.3 from 86.3, while the Expectations Index rose to 92.7 from 86.4 in June.
It was the third consecutive month the outlook improved and it now stands at its highest level since October 2007 (95.2).
Lynn Franco, director of economic indicators at the Conference Board, said strong job growth helped boost consumers’ assessment of current conditions, while brighter short-term outlooks for the economy and jobs, and to a lesser extent personal income, drove the gain in expectations.
Biomass One LP on Avenue G in White City is one of 36 energy facilities in 14 states designated by the U.S. Agriculture Department to accept biomass deliveries through the Biomass Crop Assistance Program.
Biomass owners who supply such facilities may qualify for delivery assistance starting this week.
The Ag Department said half of the $25 million per year authorized for BCAP is available each year to assist biomass owners with the cost of delivery of agricultural or forest residues for energy generation.
Other Oregon companies included in the program are: The Gilcrhist Division of Interfor Pacific Inc.; Ochoco Lumber’s Malheur Lumber unit in John Day; Roseburg Forest Products; and Seneca Sustainable Energy LLC of Eugene.
Major cities tracked in the Case-Shiller Home Price Indices plateaued, and even slipped, in many markets.
Nationally, 14 of 20 major metros saw an 0.3 percent month-over-month decline from April with only Charlotte and Tampa posting gains.
Housing Wire reported lower-priced homes and appreciated more quickly than expensive homes.
The good news for Rogue Valley is that four markets critical to local sales were among the nine nationally that have seen double-digit, year-over-year gains. San Francisco (15.4%), San Diego (12.4%), Los Angeles (12.3%), and Portland (10.0%) also scored double-digit increases in May.
And this from AAA Oregon/Idaho, the national average for regular unleaded fell a nickel this week to $3.52 while Oregon barely moved down to $3.93.
Here in Jackson County, the average is $3.95, down 8 cents from a month ago, but more than 3 cents higher than this time last year.
When all is said and done, maybe they’ll call it the Family Tree.
With the dollar buying significantly less each turn of the calendar, it makes plenty of sense for heavyweights of the dollar-store to combine their resources.
Dollar Tree announced its plans today, concerning a $9.2 billion cash-and-stock deal, including debt assumption.
The acquisition creates will create a discounter with 13,000 stores in 48 states and five Canadian provinces, with sales exceeding $18 billion and more than 145,000 employees.
Dollar Tree is the nation’s biggest operator of fixed-price point stores, selling everything for $1 or less. It has three stores in Medford, as well as locations in Ashland, Central Point, and White City, along with two in Grants Pass. Family Dollar is among the top multi-price point stores. Dollar Tree said it intends to retain and to grow each of its brands and the Family Dollar brand.
Dollar Tree targets customers primarily in suburban areas and Family Dollar targets low- and lower-middle income households through its urban and rural locations. The deal will enable Dollar Tree to serve a broader range of customers and deliver even greater value to them.
In the the wake of United Express pulling out of Klamath Falls and Modesto, Calif., earlier this year, another Northern California community is mulling its prospects should United Express depart. Here’s a report from the Chico Enterprise-Record.
While Lithia Motors has upped its expansion profile with the announced deal for DCH Auto Group, its competitors are not idling at the corner market.
Asbury Automotive Group, the nation’s seventh-largest auto retailer — one notch above Lithia Motors — plans to double its pace of acquisitions during the next 18 months.
Alaska Air Group, Boise Cascade and Umpqua Holdings all report second quarter earnings on July 24. Given today’s news from MicroSoft, 18,000 layoffs, and the national housing construction report, new starts down 9.3%, it will be interesting to see how this Northwest trio does.
The Oregon Department of Revenue has mailed letters to taxpayers in possession of refund checks that haven’t been cashed as a reminder to redeem these checks prior to October.
Checks are void after two years and sent to the Department of State Lands.
If a letter is received, cash it immediately. If the check has been lost or was never received, taxpayers should sign the notification letter and return it to Revenue to have the check reissued.
Last year, Oregon taxpayers were notified about more than $1.85 million in uncashed refund checks. This year, close to 2,000 notification letters were mailed.
Visit www.oregon.gov/dor to get tax forms, check the status of your refund, or make tax payments; or call 1-800-356-4222 within Oregon; or email, email@example.com.
Inside Radio reports a continued decline in licensed AM radio stations. The number of licensed AM stations fell to their lowest level in more than three decades during the first half of 2014. At the same time the total station number hits another new all-time high:15,425.
It appears the YouTube generation is in love with HD everything, making AM stations a tougher sell.
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Alaska Airlines said today it will be the first carrier to get Boeing’s innovative Space Bins for its fleet of 737s. The larger overhead bins have a similar look and feel to the Boeing Sky Interior pivot bins yet hold more bags.
Here’s the essence of what could be best described as an unwelcome announcement today from the Oregon Public Utility Commission:
Natural gas prices are likely headed higher this fall according to officials with Oregon’s three regulated natural gas providers. That was the message they delivered to the Commission during the annual Gas Outlook on Tuesday.
Pressure is being put on natural gas prices by an extremely cold winter that has depleted reserves, and a shift to natural gas from coal to generate electricity said company officials.
“We are at our lowest gas storage levels since 2003,” said NW Natural’s Randy Friedman.
NW Natural expects their increase in middle single digits. Avista Utilities predicts an increase of 8 to 10 percent. And Cascade Natural Gas said it should be in the same range as the others.
Oregon’s natural gas companies get their supplies of gas from Canada and the Rocky Mountain region.
Each year the Commission reviews the gas costs proposed for recovery from customers by each Oregon gas company both to ensure the costs are reasonable and prudent, and that the company has taken all actions available to it to keep these costs as low and stable as possible. If the Purchased Gas Adjustment(PGA) functions as designed each core customer pays only actual gas costs, with no mark-up or profit for the company.
Oregon’s natural gas companies will send their requests to the Commission Aug. 1. After the Commission evaluates the requests, new rates will take effect Nov. 1.
The view from here:
Start saving up now for a winter of discontent.
Avista Corp. has picked up a $3.2 million grant from the state of Washington to research how to integrate power generated from intermittent renewable sources such as wind and solar into the electrical grid.
It was part of $14 million series of matching grants awarded by Gov. Jay Inslee’s Clean Energy Fund.
While it may not have any immediate, near-term, or even local impact on Avista’s Natural Gas customers in Southern Oregon, the research may lead to long-term energy solutions in many places.
With the exception New York and the District of Columbia, double-digit year-over-year foreclosure declines were the norm in May.
According to real estate analytics firm CoreLogic every state posted double-digit year-over-year declines in completed foreclosures.
For the 12 months ending May 2014, Oregon saw 4,121 foreclosures, down from 5,140 the preceding 12 months.
Oregon, however, still retains a relatively high mortgage payment delinquency rate of 4.1%
Market Watch takes a look at the big box hardware store giants Lowe's and Home Depot.
Next time the ticket agent or TSA screening lines slow you en route to your destination. Think about this band of weary flyers, who have to wait another 86 years.
So how does Oregon stack up when it comes to touring via automobile. WalletHub put the Beaver State through a series of 21 measures, comparing it with the rest of the union to see which state offers the most enjoyment and the least damage to one’s wallet. Driving costs, lodging prices, traffic safety, weather and attractions were all part of the analysis.
Somebody loves us, however, because WalletHub corornated as the best state for road trips.
Oregon ranked No. 7 for its attractions, 34th for low-price 3-star hotels, 44th for average gas price (No surprise for those of us trying to cope year-round with fuel costs.), fourth for per capita nightlife options, 12th for per capita miles traveled (Probably would be higher on the list if it weren’t for price of those miles.), per capita car thefts, third for Scenic Byways (There’s always one nearby in Oregon.), 31st for correlation between historical high temperatures, July 1- Aug 31, and the ideal 75 Fahrenheit; and No. 1 for driving laws (Not sure if this is a good or bad thing.)