L.A.'s top 50 deals of 1998.

Deals of all sizes and significance take place every day of the week in Los Angeles. They are the result of many things: Companies and properties change hands. Family businesses go corporate. New players appear on the scene. Long-time institutions fade into the sunset.

Dealmaking last year pretty much kept up 1997's blistering pace, although there were exceptions. Aside from a few blockbuster issues, the market for initial public offerings slowed considerably. Venture capital investment, however, picked up - perhaps a sign that the area is attracting more attention among the venture community.

The Business Journal takes stock of the major deals of 1998 - and, as usual, we use the term loosely. It could be an acquisition, contract or government OK. In addition, the rankings are strictly subjective, based not only on the value of the deal but its importance relative to L.A.'s overall economy.

1. Washington Mutual Buys H.F. Ahmanson

Washington Mutual Inc.'s purchase of H.F. Ahmanson & Co., parent of Home Savings of America, marked the end of an era in Los Angeles.

The $10 billion deal, which closed in October, caps off an institution that more than any other helped finance L.A.'s post-World War II housing boom. It also eliminates the last major financial-services company based here.

To put the loss of Ahmanson into perspective, City National Bank, which now claims to be the largest financial institution headquartered in L.A. County, is less than one-tenth the size of Ahmanson, in terms of assets.

The Ahmanson acquisition was the culmination of a buying spree by Washington Mutual. It also included the purchase of local thrifts American Savings Bank and Great Western Bancorp, and makes the Seattle-based behemoth L.A.'s largest financial institution - in terms of local deposits - ahead of even Bank of America or Wells Fargo & Co.

The sudden emergence of Washington Mutual has been praised by some local observers, who say that it illustrates the local economy's vibrancy and growth potential. But the buyout also raised concerns. It resulted in the elimination of more than 3,000 jobs, most of them local. It also marks another in the growing string of major public companies disappearing from Los Angeles, and the loss of a corporate citizen that had played an important role in the area's economic and civic life.

- Jason Booth

2. Ticketmaster Online-CitySearch Merger

It was one of the more dramatic power plays seen the tech industry this year, giving birth to a new pillar of L.A.'s new-media business.

Ticketmaster Online already had monthly sales of about $10 million when it joined up with CitySearch in August. The new company became the object of substantial industry interest because it combined CitySearch's advertising-driven platform with Ticketmaster's steadier transaction-based operations.

As an emerging Internet success story, the online city guide and ticket seller can help set the local tech industry on an upward path. Start-up companies routinely spin off from pillar companies - as has been proven in Silicon Valley - creating an environment that is funded by well-entrenched venture capital and staffed by the congregated talent pool.

Before going public, Ticketmaster Online-CitySearch underwent a dramatic rebirth. Born in Bill Gross' new-media incubator Idealab! and responsible for over a dozen online city guides, CitySearch planned to launch a much-anticipated IPO last summer. That plan was scrubbed at the 11th hour, when the company announced a surprise merger with the online arm of Ticketmaster. The then-merged entity went public in December with what turned out to be one of the top five offerings in IPO history in terms of first-day price increases.

The meteoric stock has since skyrocketed into the $80 realm - not bad for what is essentially a brand-new, unproven company.

- Sara Fisher

3. DreamWorks at Playa Vista

After months of delays, feuds and heated negotiations, Playa Vista hit a major milestone this fall, when DreamWorks SKG and the developers of the huge commercial and residential project near Marina del Rey signed a definitive agreement for DreamWorks' $250 million studio and headquarters.

The agreement paves the way for construction of the first major studio to be built in Los Angeles in a generation. It is the cornerstone of a multibillion-dollar project that supporters claim will generate thousands of jobs and attract other entertainment companies to one of the area's last parcels of land.

DreamWorks still has to finalize financing. But barring further delays or complications, the studio is expected to move about 1,000 employees to Playa Vista by mid-2001.

Under the agreement, DreamWorks will pay $20 million for 47 acres of land and will have the rights to build up to 1.5 million square feet of space, including at least eight sound stages.

It's been almost four years since plans for the 1,087-acre master-planned community were first announced. But it was soon mired in financing problems and negotiations between the studio and the developers eventually bogged down.

Playa Vista is not exactly out of the woods yet. Developer Robert Maguire, who lost the controlling ownership but retains a small stake, has threatened to take legal action against the project's developers and the city of L.A. And some environmental groups continue to oppose the project.

Meanwhile, grading and other preparation work continues for the residential component of the project, which will comprise more than 3,200 residences in the first phase.

- Elizabeth Hayes

4. TrizecHahn Breaks Ground in Hollywood

All the talk about a revitalization of Hollywood finally turned to action last fall, as TrizecHahn Corp. broke ground with great fanfare on its massive Hollywood & Highland retail-entertainment project.

The complex has been touted as the cornerstone for Hollywood's return to glory. The $385 million project, located next to Mann's Chinese Theatre, will have shops, restaurants, offices, a 500-room hotel and a permanent home for the Academy Awards show - all of which is expected to spark new activity in the long-dormant area.

Already, the neighborhood is showing signs of new life. Property values and rents are rising and crime is down, thanks in part to the efforts of the Business Improvement District. Several other multimillion-dollar entertainment-shopping projects are in the works nearby and the historic Egyptian Theatre recently reopened down the block.

But there's still work to be done. Even with new property owners moving into Hollywood in recent months - including well-respected real estate firms Kennedy-Wilson Inc. and CIM Group - the decay of recent decades still lingers. And now that TrizecHahn has begun construction, the next question is, who will lease up the space there? So far, the only announced tenant is musician-producer Quincy Jones' restaurant, Q's Jook Joint. But TrizecHahn's David Malmuth promises that other high-profile restaurants and retailers will be signing on soon.

- Elizabeth Hayes

5. Seagram Buys PolyGram

This is one deal that did not go for a song.

With the $9.7 billion purchase of PolyGram NV, Montreal-based Seagram Co. Ltd. became the world's largest music company. Combined with sales from Seagram's Universal Music Group, the beverage company now controls 22 percent of the world music market, overtaking Japan's Sony Music Entertainment Inc., with 17 percent. Analysts estimate that Seagram's music interests will now generate 43 percent of the company's $2.3 billion in earnings before interest, taxes, depreciation and amortization.

Once a minor player in the music industry, Seagram's lineup now includes Elton John, Sheryl Crow, U2, Shania Twain and rapper LL Cool J. In addition, the combined companies boast one of the best distribution networks in the music industry.

The deal comprised 75 percent of Royal Phillips Electronics NV's share of PolyGram. Originally pegged at $10.6 billion, it fell to $9.9 billion when the Dutch company agreed to take some Seagram stock in exchange for the music unit. But when the deal closed in the fall, Seagram's shares were worth 27 percent less than their price last May when the acquisition agreement was originally struck. That drop has been attributed to the slumping box-office returns for Seagram's Universal Pictures division and a decline in liquor sales in financially troubled Asia.

To help defray the cost of the multibillion-dollar deal, Edgar Bronfman, Seagram's CEO and a sometime songwriter himself, plans to sell off PolyGram's film division as well as consolidate a number of overlapping music divisions, a move expected to result in substantial layoffs.

- Frank Swertlow

6. GeoCities' Initial Public Offering

One of the year's hottest stores was Internet mania on Wall Street, and helping fuel the frenzy was GeoCities, the Marina del Rey-based Web company.

After four years of nothing but red ink and hopeful prognostications, GeoCities went public on Aug. 11 and suddenly became a $982 million market-cap company. The IPO represented a 15 percent stake in the company, which bills itself as the world's largest community of personal Web sites on the Internet.

GeoCities gives its more than 2 million members free home pages and e-mail, and makes its revenue from advertising on its site. Shares soared by 119 percent on the first day of trading to reach a high of $37.31. Over the subsequent months, GeoCities' stock has reflected the market's general direction, reaching up past $50 per share and crashing down to $13.25. As of last week, the stock hovered around the $40 mark.

GeoCities, along with Ticketmaster Online-CitySearch, is considered one of the pillars of L.A.'s new-media industry. If these companies can continue their success, it is believed they will give birth to other Internet firms.

- Sara Fisher

7. News Corp. Spins Off Fox Entertainment

For years, Rupert Murdoch complained that his far-flung media empire was undervalued by Wall Street, as well as by overseas investors. To remedy that, Murdoch spun off News Corp.'s entertainment assets into a separate public company called Fox Entertainment.

Among the new company's assets are the Fox television network, 22 Fox TV stations in the United States, Twentieth Century Fox Film Corp., 30 regional sports networks, the Los Angeles Dodgers and minority interests in the Lakers, Kings and New York Rangers sports franchises.

These assets generated almost $7 billion of News Corp.'s $11 billion in 1997 revenues.

Why an IPO? Fox's U.S. entertainment assets are much easier for Wall Street analysts to track and understand because they are more straightforward, while News Corp.'s remaining assets are a maze of industries (newspapers, magazines, book publishing and satellite TV operations) linked through multiple joint ventures in various foreign countries.

Murdoch concluded that those convoluted operations were to blame for his company's "undervalued" stock price.

Fox was originally to sell a 20 percent stake in the IPO for total proceeds of about $4 billion. When it came to market in November, only 18.6 percent was sold for $2.8 billion. Nonetheless, it qualified as one of the largest media IPOs in history.

Some analysts anticipated that Murdoch would use the proceeds to pare down News Corp.'s debt load. But less than two months after the offering, Murdoch embarked on yet another acquisition. His Milan-based company, News Corp. Europe, agreed to purchase an 80 percent stake in an Italian digital pay TV service for $120 million.

- Frank Swertlow

8. Global Crossing Goes Public

When it comes to big deals in 1998, they don't get much bigger or more ambitious than Global Crossing Ltd.

In August, the company, which is incorporated in Bermuda but controlled by L.A. investor Gary Winnick, raised $400 million in an initial public offering. Since then, the stock has more than doubled in price, to about $47 last week. That puts total market capitalization at nearly $9 billion. The IPO came on the heels of an $800 million bond offering by Global Crossing earlier in the year.

Then in December, the firm quietly raised an additional $500 million in a private placement of preferred stock, and then another $500 million in non-investment-grade debt.

What has captured the imagination of many investors is the sheer scope and ambition of Global Crossing's business plan. The company is in the process of laying tens of thousands of miles of high-capacity fiber-optic cables across the world's sea beds. It will then sell space on those lines to telecommunications firms that are desperate for more capacity to handle the growing demand for digital and Internet-related communications.

Already, the company has completed links across the Atlantic and is in the process of laying cable in the Caribbean and the Pacific.

- Jason Booth

9. All Those Dodger Deals

Dodger Blue seemed everywhere in 1998 - actually, black and blue is more like it.

It started, of course, with the approval in March by Major League Baseball owners of the team's sale to Rupert Murdoch's News Corp. for $311 million. Soon after that came a volley of dealmaking.

In May, the team traded all-star catcher Mike Piazza and third baseman Todd Zeile to the Florida Marlins for all-stars Gary Sheffield, Bobby Bonilla and Charles Johnson, along with two other players. The trade followed protracted contract negotiations with Piazza, who wanted a $100 million-plus, seven-year contract - a sum the team considered too high. Many Dodger fans were stunned at the trade because Piazza was perhaps the team's best-known and most-beloved player.

But that was just for openers. Four months later, the Dodgers hired Kevin Malone, then the Baltimore Orioles' assistant general manager, as its executive vice president and general manager. He replaced Fred Claire, the longtime executive vice president who, along with Manager Bill Russell, were fired in a June shakeup of team management.

In October, following an arduous search process, the Dodgers hired Davey Johnson to become only the fifth manager to lead the team since it moved to L.A. 40 years ago. Johnson's $1 million-a-year salary puts him among the highest-paid managers in baseball.

Then, last month, as off-season dealmaking on other teams kept lacking up, the Dodgers signed all-star pitcher Kevin Brown, who helped lead both the Florida Marlins and the San Diego Padres to the World Series, to a seven-year, $105 million contract - making him baseball's first $100 million player.

The question now is whether all these deals will actually help the Dodgers rebound from their disappointing 83-79 season last year.

- Daniel Taub

10. Kroger Buys Fred Meyer

The consolidation of L.A.'s supermarket industry came to a head in October when Kroger Co. agreed to buy Fred Meyer Inc. in an $8 billion deal.

While Fred Meyer is based in Portland, Ore., it is majority-owned by L.A. supermarket magnate Ronald Burkle, the company's chairman. Fred Meyer is the biggest owner of area supermarkets, including Ralphs, Food 4 Less and Hughes.

The merger will solidify Kroger's position as the nation's largest grocery chain, with 2,000 stores reaching from California to the East Coast, and sales of around $43 billion.

The Kroger deal is the latest in a wave of mergers sweeping the supermarket industry, which is in the midst of cutting costs in order to compete against low-price retailers like Wal-Mart and Kmart.

The consolidation has raised concerns among local consumer activists who maintain that less competition will result in higher prices. But Burkle's past deals have resulted in little interference from regulators - beyond requirements that he sell off a few individual stores.

Few have ridden the wave of corporate consolidation as deftly and profitably as Burkle. Getting his start in the grocery business as a box boy in a suburban Los Angeles market, Burkle has made himself a billionaire through his heavily leveraged purchases and sales of supermarket chains.

With the sale to Kroger, Burkle's net worth is estimated to have risen to around $1.7 billion, raising the expectation that he will be engaged in some serious dealmaking in 1999.

- Jason Booth

11. Newhall Ranch Approved

After four years in the pipeline, Newhall Ranch finally received unanimous approval from the Los Angeles County Board of Supervisors in November.

The board's sign-off of the largest master-planned project in L.A. County history touched off a firestorm of protest from Ventura County supervisors, who vowed to block the project in court. Ventura County officials argued that Newhall Ranch would deplete the natural resources of the area's citrus-growing valley. In addition, the Sierra Club filed a complaint with the state Public Utilities Commission, maintaining that the project would create water shortages.

Tucked between the Ventura County line and the city of Santa Clarita, Newhall Ranch is designed to be a planned community of roughly 21,000 homes, along with retail shops and parkland. It is being developed by Newhall Land & Farming Co.

Yet the project's proximity to the county line has Ventura County officials arguing that their residents will suffer the brunt of the development's costs (traffic congestion, noise, pollution, etc.), and that L.A. County residents will reap most of the benefits (new housing, sales and property tax revenues, etc.).

Ironically, on the very same day that L.A. supervisors approved Newhall Ranch, Ventura County supervisors approved Ahmanson Ranch - a similarly huge master-planned project just over the county line. Los Angeles officials strongly oppose Ahmanson Ranch for the same reasons Ventura County officials oppose Newhall Ranch.

- Nola L. Sarkisian

12. Disney Invests in Infoseek

The line between television and the Internet grew increasingly fuzzy last year as media companies bought into portal sites.

Among the most significant of those deals was Walt Disney Co.'s acquisition in June of a 43 percent stake in Infoseek Corp., in a stock-plus-cash transaction worth about $420 million.

This isn't Disney's first Internet acquisition. A couple of years earlier Disney bought Starwave Corp., a designer of such popular Web sites as ESPNet-SportsZone.com.

But the Infoseek deal takes Disney to a new level in its quest to bring fantasyland into cyberspace. Infoseek is a Web search engine and navigation service, which Web surfers can use to locate specific types of information on the Internet.

Analysts have hailed the deal, saying Disney's media products will benefit from the added online presence on Infoseek, and that Infoseek will benefit from using Disney's marketing clout to boost its online traffic. While Infoseek is one of the more popular portal services, it continues to lag such giants as Yahoo! and Excite.

But the new Disney-Infoseek partnership hasn't wasted any time trying to change that. Just last month, it launched one of the largest new Web hubs, called the Go Network. Should that site catch on, as expected, Infoseek would eventually be phased out, industry officials predict.

In exchange for its stake in Infoseek, Disney gave the company its wholly owned Starwave operation, valued at $350 million, as well as $70 million in cash.

- Nola L. Sarkisian

13. NationsBank Buys BankAmerica

Signals have been decidedly mixed about BankAmerica Corp.'s commitment to Los Angeles following its $43 billion acquisition by NationsBank Corp. last October. Though the bank was based in San Francisco, Los Angeles long has been BofA's biggest market, and the bank has made extensive promises about inner-city lending.

That's why the departure of Donald A. Mullane, BofA's executive vice president for community development, was seen as a signal that the new entity would be less involved in the local community. But the bank also created a new Southern California division headed by Liam McGee, a BofA executive who is considered familiar with L.A. banking.

Mullane wasn't the only recent departure. BankAmerica President David A. Coulter abruptly resigned less than a week after the San Francisco bank reported more than $1.4 billion in losses tied to trading in volatile global markets - as well as an unsecured loan to New York-based hedge fund D.E. Shaw & Co.

BankAmerica, the name of the merged Charlotte-based bank, plans to eliminate between 5,000 to 8,000 jobs - about 3 percent of the 200,000-strong workforce nationwide - to help reach $1.3 billion in cost savings. The 14,000 employees in Los Angeles County will be spared from most of the downsizing.

With $580 billion in assets, the new institution is the nation's second largest bank behind Citigroup, with assets of $698 billion.

- Nola L. Sarkisian

14. NBC Deals for 'ER'

In a move that sent shock-waves throughout the entertainment industry, NBC agreed to pay Warner Bros. Television $13 million per episode to renew TV's top drama, "ER" - the highest price ever paid to renew a series. The three-year deal is worth $286 million a year for 22 episodes, or $858 million for the entire package.

The "ER" deal has caused major changes in the way network television creates and finances its programming.

Rather than licensing the right to broadcast a series for the traditional four-year run, networks are now demanding that producers make five- and six-year deals. The networks also have rushed to develop their own in-house projects, thereby eliminating the need to renew a series at such an exorbitant licensing fee.

How did Warner Bros. get NBC to dig so deep? Ironically, the studio offered to renew the medical drama after its second year at a more modest licensing fee. NBC, which at the time was flying high in the ratings, declined, paving the way for Warner Bros.' big payday two years later.

By that time, NBC was desperate to keep its top slot as the ratings champ (it had just lost "Seinfeld"). To do that, it needed "ER," the top-ranked network show. To make matters worse, CBS had let it be known that it would be willing to pay $12 million per episode for the series if NBC passed. NBC was compelled to sign on the dotted line, forever changing the rules of the game.

- Frank Swertlow

15. New Century City Tower Approved

It was a hard-fought battle for JMB Realty Corp. this year, but it apparently has paid off. The Chicago-based real estate company won approval from the Los Angeles City Council in June to build a 704,000-square-foot, 38-story office tower on the last available parcel of land in Century City - despite opposition from surrounding homeowners and Councilman Mike Feuer.

Feuer and several local homeowner groups argued that the developer did not conduct sufficient tests to determine traffic impacts. But JMB convinced the council that it plans to alleviate congestion by spending $6.4 million on new controls. Specifically, the developer agreed to have new traffic control systems installed at 73 intersections throughout the area. JMB also promised to alleviate traffic congestion by using a technology called Adaptive Traffic Control System, which involves street-level sensors to monitor traffic and adjust the timing of the signals accordingly.

The tower, dubbed Constellation Place, will be constructed on the corner of Constellation Boulevard and Century Park West, across the street from the Century City Shopping Center & Marketplace. Despite rents that are likely to be among the highest in the city, interest among potential tenants already is high.

- Jessica Toledano

16. Agreements Reached for Downtown Cathedral

After two years of wrangling over a site, the Archdiocese of Los Angeles' effort to replace earthquake-damaged St. Vibiana's Cathedral finally got underway.

In October, ground was broken for the $163 million Cathedral of Our Lady of the Angels on a 5.5-acre lot at the corner of Temple Street and Grand Avenue in downtown. The cathedral, now set for completion in mid-2001, will be the new focal point for the region's 4 million Catholics, the largest archdiocese in the country.

Construction began in earnest last month with the start of the first phase: an underground parking lot, administrative buildings and a residence for Cardinal Roger Mahony and his successors. Work on the 70,000-square-foot cathedral itself, which is being designed by Spanish architect Jose Rafael Moneo, won't begin until later next year.

Mahony, along with the cathedral's financial backers and city development officials, hope that the cathedral will serve as a one of the keys to downtown's revival, especially the Grand Avenue cultural corridor that includes the Music Center, the Museum of Contemporary Art and soon, the Disney Concert Hall, which is now under construction.

- Howard Fine

17. AIG Acquires SunAmerica

One of the more unexpected mergers of the year was between Los Angeles-based SunAmerica Inc. and American International Group Inc.

SunAmerica, the Century-City based financial services giant led by Eli Broad, is one of the most successful and civic-minded companies in Los Angeles, so many insiders were surprised when Broad decided to sell out.

The reason: growth.

SunAmerica wanted to expand its reach into Asia, where AIG does a great deal of business. The Asian market is still relatively untapped in terms of retirement plans - recessionary troubles and all - and Japan, in particular, has a high potential for growth. SunAmerica also stands to gain a better credit rating out of the deal.

The $18 billion buyout by New York-based AIG is expected to close next month. After the deal is completed, SunAmerica will retain its name, management structure and Los Angeles headquarters. Broad will continue to run the company as a subsidiary, and he has emphasized that the sale would not alter SunAmerica's overall commitment to L.A.

- Jessica Toledano

18. Computer Sciences Wins IRS Contract

Computer Sciences Corp. made history last month by landing a much-coveted contract to overhaul the Internal Revenue Service's computer systems. The deal, valued at between $3 billion and $7 billion and extending for up to 15 years, is the biggest ever in the computer services industry and may be the biggest non-defense contract ever granted by the federal government.

CSC now faces the daunting task of making over one of the world's most technologically challenged institutions. The biggest undertaking will be to make the IRS system customer-friendly, so that taxpayers can easily access their personal records and reach agency officials.

CSC will also expand an electronic tax payment system, further develop an Internet tax filing system, and design IRS computer terminals that will protect taxpayers' privacy. In addition, CSC will ensure that the year 2000 bug has been fixed in the system.

Leading a team of seven companies - including IBM, KPMG Peat Marwick, Lucent Technologies and Northrop Grumman Corp. - CSC is expected to capture as much as 35 percent of the total contract. The CSC team beat out one led by Lockheed Martin Corp.

Before putting the bid out to private-sector contractors, the IRS had notoriously bungled several in-house attempts at modernizing its computer system, which is more than 30 years old.

- Sara Fisher

19. Sony Buys Telemundo, Moves It to L.A.

It's been reported that Miami dominates the Spanish-language entertainment industry, but you would have a hard time proving it now that both Spanish TV networks are based in L.A.

With an eye on the fast-growing Latino market, Sony Corp. and Liberty Media completed in August their $539 million purchase of Telemundo Group, the nation's No. 2 Spanish-language network. A few months later, Telemundo's headquarters was moved to L.A. from Miami.

The purchase represents Sony's introduction to the broadcast network market at a time when Spanish-language TV is booming. Telemundo's chief rival, Century City-based Univision, entered the fall season as the fifth-largest network in the country and the No. 1 Spanish-language network. Sony executives believe the market for Spanish TV will continue to grow, and predict that money-losing Telemundo will be in the black within four years.

In September, Telemundo began its new season with a dramatically altered line-up, moving from its traditional fare of prime-time soap operas. So far, the results have been discouraging, but not unexpected. The network's ratings have fallen close to 3 percent since the season began, but Telemundo President and CEO Peter Tortorici said such activity can be expected after any kind of brand change.

- Karen Teitelman

20. Hilton Splits Into Two Companies

For the better part of two years, Hilton Hotels Corp. President Stephen Bollenbach and gaming operations chief Arthur Goldberg had been looking for ways to boost the value of the company's stock, which was sagging because of intense competition in the gaming industry. Their first two attempts fell flat: Hilton lost a year-long hostile bid for ITT Corp., and in March, a planned merger with Circus Circus Enterprises Inc. fell through.

Then in June, Bollenbach and Goldberg put together a deal that shows promise of getting done.

It involves Hilton splitting off its gaming operations into a separate company and acquiring Minnetonka, Minn.-based Grand Casinos Inc. The gaming operations of both companies would then be folded into a separate company, to be called Park Place Entertainment Corp.

The idea is to separate Hilton's more-profitable hotel operations from its sagging casino operations. IRS rules allow such a split to be undertaken tax-free as long as there is a simultaneous acquisition; hence the buyout of Grand Casinos.

But the deal has so far failed to provide the intended boost to Hilton's stock; in fact, shares have fallen from $31.50 on the day the deal was announced to $20.06 as of last week. (It has, though, rebounded from its 52-week low of $12.50.)

Grand Casino's stock has not fared any better: It has fallen from $18.50 on the day of the deal to $8.75 as of last week. Analysts say the slump in the gaming industry is largely to blame. Meanwhile, the split of Hilton's gaming and hotels businesses was slated to close Dec. 31. The deal has been approved by the Securities and Exchange Commission, the IRS, Hilton and Grand Casino shareholders. But as of last week, approval still had not come from regulators in Missouri and Louisiana, where Hilton has riverboat gaming operations.

- Howard Fine

21. Alameda Corridor Gets Underway

After 14 years of planning, the Alameda Corridor - the much-touted $2.4 billion rail expressway linking the ports of L.A. and Long Beach with the distribution centers near downtown - finally became more than a dream.

Last month, construction commenced on the heart of the project - a 10-mile, $712 million sunken concrete trench that will contain two tracks, moving train traffic below grade and eliminating some 200 grade crossings.

And on Dec. 17, the Alameda Corridor Transportation Authority, the agency overseeing the project, approved the sale of $1 billion in revenue bonds to help pay for the undertaking.

If all goes as planned and the Alameda Corridor is completed in 2002, it will dramatically improve the movement of cargo from local ports, boosting average rail speeds from 10 mph to 40 mph and reducing surface street traffic congestion in Southeast Los Angeles. The authority has hired a consortium of companies headed by Tutor Saliba Corp. to construct the trench - the corridor's most critical component - despite the company's association with serious mishaps during construction of the Metro Rail subway system.

The corridor has also sparked development activity elsewhere in the region. In the San Gabriel Valley, planners in November secured $155 million in funding for the so-called Alameda Corridor East, a proposed $950 million extension of the corridor that would involve improving 55 rail/street intersections stretching east to San Bernardino.

- Larry Kanter

22. Hughes Buys U.S. Satellite Broadcasting

As satellite TV companies race to grab market share from cable before it's too late, Hughes Electronics Corp. moved last month to firm up its hold on the market with a $1.3 billion offer to buy St. Paul, Minn.-based U.S. Satellite Broadcasting Co.

If approved by shareholders and regulators, the deal will give Hughes' DirecTV, already the nation's biggest satellite TV service, a greater reach in the industry, more satellite slots and the ability to offer more programming. But because most USSB subscribers already subscribe to DirecTv through a joint operating agreement, it won't boost subscriptions very much - DirecTV will pick up about 200,000 new customers.

The deal is expected to close during the second quarter of 1999. It could bring an additional $900 million to DirecTV during its first full year, boosting total DirecTV revenues to $1.5 billion, a 60 percent gain. This additional revenue would help offset what analysts expect will be a decline in the sign-up rate of new satellite TV subscribers, as cable companies upgrade their networks and offer additional services like connections to the Internet.

- Howard Fine

23. Mattel Buys Learning Co.

As toys go high tech, Mattel Inc. is trying to reinvent itself by getting into the software business.

Mattel is coming off a disappointing year and recently estimated that its 1998 earnings would be 33 percent lower than its previous estimate. Retailers, particularly the nation's biggest toy chain, Toys 'R' Us, have cut back on orders in order to reduce their inventories.

The purchase of Cambridge, Mass.-based Learning Co. reflects the change in children's tastes towards more sophisticated diversions like computer toys, rather than just action figures and Hot Wheels. With the $3.2 billion deal, Mattel is looking to build a $1 billion interactive software business.

Learning Co. is the nation's second-biggest software developer after Microsoft Corp., and it publishes the Reader Rabbit and National Geographic titles. In June, Learning Co. bought Broderbund Software Inc., creator of such titles as Myst and Carmen Sandiego.

- Nola L. Sarkisian

24. Catholic Healthcare West Buys UniHealth

One of the most significant deals in the health care industry this year was Catholic Healthcare West's acquisition of eight UniHealth hospitals in Los Angeles and Orange counties.

The acquisition, which was completed in early December, made San Francisco-based Catholic Healthcare West the second-largest hospital chain in Southern California after Tenet Healthcare.

Financial terms were not disclosed, but industry observers say it was a sweetheart deal for Catholic Healthcare West. Nonetheless, buying the troubled hospitals from Burbank-based UniHealth was not an easy decision for executives at CHW.

The hospitals have been experiencing serious financial woes over the past few years. In fact, seven of the eight hospitals collectively lost $11.1 million in their most recent fiscal year, according to the Office of Statewide Health Planning and Development.

Catholic Healthcare West now has 13 hospitals in Southern California - including St. Vincent Medical Center in downtown Los Angeles and St. Mary's Medical Center in Long Beach, which it owned before the UniHealth deal. Tenet owns 16 hospitals in Los Angeles.

- Jessica Toledano

25. Douglas Emmett's Buying Spree

Douglas Emmett Realty Advisors went on a tear in 1998, snapping up real estate in L.A.'s hottest office markets with a combined value of more than $425 million - making the Brentwood-based firm one of the year's most active buyers, as well as one of the largest property owners in West L.A.

Douglas Emmett has a letter of intent to buy 1900 and 1901 Avenue of the Stars in Century City for around $225 million. The buildings, which encompass more than 1 million square feet, are being sold by Tokyo-based Shuwa Corp. Another high-profile acquisition-in-progress is the 15-story Westwood Place office tower on Wilshire Boulevard.

In the San Fernando Valley, the firm is buying Encino Terrace Center and McNeil Plaza on Ventura Boulevard. It also bought the Sherman Oaks Galleria last year.

Those pending deals follow the purchase last summer of a 10-story office building at the corner of Wilshire and Santa Monica boulevards in Beverly Hills for more than $26 million.

Douglas Emmett advises institutional investors on which commercial properties to buy in the L.A. market, and then usually manages the property once it has been purchased.

- Elizabeth Hayes

26. Rose Bowl Gets AT&T as Corporate Sponsor

The bowl season has become a corporate wonderland, at with the Tostitos Fiesta Bowl, Nokia Sugar Bowl and the FedEx Orange Bowl. But the annual Rose Bowl game stood its ground in resisting a deal with a corporate sponsor.

Until this year. In June, ABC Inc., which broadcasts the Rose Bowl each New Year's Day, signed an agreement with AT&T to sponsor the game. One accommodation was made: Unlike other bowl games, which generally have their sponsors' names before their own, the Rose Bowl is being billed as "The Rose Bowl, Presented by AT&T."

The oldest of the bowls, the Rose Bowl last year joined the college football alliance that includes the Fiesta, Sugar and Orange bowls. Under ABC's contract with the alliance - under which the Rose Bowl gets $19 million of the alliance's $76 million annually - the network is allowed to sign sponsors. The value of the ABC-AT&T agreement was not disclosed.

Despite the deal, a proposal presented three months later to find a naming sponsor for the Rose Bowl stadium itself was met with opposition from Pasadena community activists and elected officials, and was tabled by the Rose Bowl Operating Co.

- Daniel Taub

27. Meditrust Sells Santa Anita

Meditrust Cos. bet big on Santa Anita - and lost its shirt.

Only a year ago, the Massachusetts-based real estate investment trust acquired Santa Anita racetrack, along with other properties in Arcadia, for a reported $458 million. Of that, about $175.5 million was spent for the track itself, and Meditrust pumped in an additional $12 million in improvements.

Debt and faltering stock prices forced the company to restructure and sell off some of its holdings - including the track, which was purchased by Canadian auto-parts magnate Frank Stronach for $126 million (representing a loss of about $62 million for Meditrust). Meditrust's other Arcadia properties, including the Santa Anita Fashion Park, were not included in the deal.

Stronach, a native of Austria, is a breeder and owner of racehorses, including Breeders' Cup winner Awesome Again. He wants to transform Santa Anita, developing a theme park and pedestrian shopping area adjacent to the track.

Under Meditrust's ownership, Santa Anita managed to reverse a decline in attendance through a new marketing campaign. The company also developed plans for a number of improvements, including a 500,000-square-foot retail center and a multiplex theater. Stronach is expected to modify those proposals.

- Edvard Pettersson

28. Vivendi Buys Cendant Software

After watching its former owner become hobbled by alleged accounting fraud, Torrance-based Cendant Software now boasts a healthier parent. French conglomerate Vivendi SA announced in December that it would acquire Cendant in a deal totaling nearly $1 billion.

Operating through its media subsidiary, Vivendi will pay Cendant Corp. an initial $800 million for the software division, plus up to $185 million depending on the software company's financial performance over the next year. The new name of Cendant Software will be announced in January when the deal closes, but the division's management team will remain intact.

For Cendant, one of L.A.'s largest software firms, the acquisition is expected to strengthen its leadership position in the recreational software industry. The company should also benefit from greater available financial resources and be better positioned in the global market.

As for Vivendi, the acquisition marks its blockbuster debut in the multimedia industry. The French company has made it clear that it intends to become a multimedia powerhouse in the coming years.

- Sara Fisher

29. Yucaipa Sells Dominick's

Few, if any, Angelenos drive a harder bargain than Ronald Burkle, and Safeway Inc. learned that first-hand last year.

Burkle's L.A.-based holding company, Yucaipa Cos., in partnership with Apollo Advisors, agreed in October to sell their jointly owned 41 percent stake in Dominick's Supermarket Inc. to Safeway. Dominick's is the second-largest grocery chain in Chicago.

For that stake plus the 59 percent stake owned by the public, Safeway is paying about $1.2 billion - roughly 10 times Dominick's earnings before interest, taxes, depreciation, and amortization.

The norm for recent supermarket deals has been around 8.5 times annual EBITDA.

The premium was classic Burkle. Industry insiders at the time suggested that the steep price Safeway paid for Dominick's was the result of a bidding war. Dealmakers like Burkle love to orchestrate such wars whenever they sell assets, because it tends to drive up the price. Although Yucaipa and Safeway officials declined to confirm the reports, industry insiders said Kroger Inc. was the other main bidder for Dominick's.

Burkle did not shun Kroger for long. Shortly after Yucaipa sold its stake in Dominick's, Fred Meyer Inc. (an even larger grocery chain controlled by Burkle) agreed to be acquired by Kroger, creating the nation's largest supermarket chain with $43 billion in annual sales.

- Edvard Pettersson

30. Albertson's Buys Lucky Parent

The number of companies left standing in the L.A. supermarket industry shrank further after Albertson's Inc. agreed in August to acquire American Stores Co., parent of the Lucky supermarket and Sav-on Drugs chains.

The $13.3 billion deal was approved by both companies' shareholders in December, but still requires final approval from the Federal Trade Commission.

That agency will most likely require the companies to sell off some L.A.-area stores, because both have a big presence in Southern California.

Currently, Albertson's operates 148 stores in Southern California, out of a total of 916 stores in 23 states. American Stores has 243 Lucky supermarkets and 278 Sav-on stores in Southern California, out of a total of 1,558 stores in 26 states.

After the merger, Albertson's will be the nation's second-largest market chain, with annual sales of $36 billion. The only chain bigger will be Kroger Co., which recently agreed to acquire Fred Meyer Inc., parent of Ralphs, creating a chain with $46 billion in annual sales.

In fact, Albertson's will be one of only three major supermarket operators in L.A. after the merger. The other two are Kroger and Safeway Inc., which has also been on a buying spree.

Driving the consolidation is the fact that larger supermarket chains can command lower prices from wholesalers. While grocery executives argue that those cost savings will translate into lower prices for consumers, some consumer groups fear the consolidation may lead to less choice and higher prices.

- Edvard Pettersson

31. International Lease Finance Cheeses Airbus

The announcement in November that Los Angeles-based International Lease Finance Corp. would order at least 30 Airbus 318 jets valued at $1.1 billion was a vote of confidence for the European airplane maker to go forward with its plans to start making the 100-seat aircraft.

It also dealt a blow to Boeing Co., which has been struggling to win orders for its own 100-seater, the 717. A hulk order from a company like ILFC can be enough to jump-start an aircraft program and influence decisions at major airlines.

And that makes the 717 vs. A-318 contest especially significant for the local economy.

The 717 will soon be the only remaining line of commercial jets assembled in Long Beach - after Boeing phases out the MD-80, MD-90 and MD-11 jetliners over the next two years. To remain a viable line - and offset some of the employment drops that will come from the MD-series jets being cancelled - the 717 must find enough customers to necessitate production of at least 60 planes each year.

While the ILFC deal with Airbus isn't good news for the 717, all may not be lost for Boeing. ILFC could end up buying some 717s, thereby continuing its practice of splitting orders between the two large plane makers. But some industry watchers say such a possibility is unlikely considering Boeing's resistance to ILFC's demands for deep price cuts.

Another favorable scenario for Boeing would be if ILFC's deal with Airbus were to unravel. The final sale is contingent on Airbus getting enough additional orders to formally launch its A-318 program and begin production.

- Jessica Toledano

32. Petersen Publishing Agrees to Buyout

One of L.A.'s biggest publishers, Petersen Cos., agreed in mid-December to be acquired by Emap, a British-based global publishing concern, for about $1.2 billion.

The deal provided a handsome premium for an investor group that acquired a controlling interest in the company two years ago for $450 million. That group included James D. Dunning Jr. and Chicago investment firm Willis Stein & Partners. At the time, co-founder Robert E. Petersen sold 90 percent of the business. The investor group took the company public about a year ago, at $17.50 per share.

Petersen started the company in 1948 when he and a partner began publishing Hot Rod magazine. Today Petersen Cos. publishes 126 special-interest magazines, which include Motor Trend and Guns & Ammo. Those titles are seen as complementary to Emap's consumer and business titles. (One notable exception is Petersen's highest-circulation title, Teen magazine, a publication for teen-age girls that has a circulation of 1.8 million.)

Emap has agreed to buy the company for $34 a share, meaning that Petersen will receive about $122 million for his remaining stake. Not that he really needs the money. Petersen's personal net worth of nearly $700 million qualifies him as not only one of the richest Angelenos but also as one of the richest Americans.

On Dec. 14, the day the deal was announced, Petersen's shares shot up 36 percent, to close at $31.31 on the New York Stock Exchange. Shares as of last week were trading close to the $34 price that Emap has agreed to pay.

- D.B. Young

33. Anschutz/Roski Buys Stake in Lakers

Adding to their growing L.A. sports empire, Denver billionaire Philip Anschutz and City of Industry developer Edward P. Roski Jr. bought a 25 percent stake in the Lakers basketball team.

The two already owned the Kings hockey team, and are building the $305 million Staples Center sports arena in downtown L.A. They also are lobbying to bring a National Football League expansion team to a rebuilt Memorial Coliseum. Separately, Anschutz last year bought the Los Angeles Galaxy, a Major League Soccer team.

The option to buy a 25 percent stake in the Lakers was part of the basketball team agreeing to become a tenant of Staples Center once the facility is completed in October. (The Kings and the Clippers basketball team also will play in the arena.) Terms of the Lakers deal were not disclosed.

Also, as part of the November deal, Anschutz and Roski have a first-look option on the rest of the team, should majority owner Jerry Buss ever decide to sell it.

- Daniel Taub

34. Wal-Mart opens Its First L.A. Store

The Broadway's loss was Wal-Mart's gain.

Two years after The Broadway was shuttered at the Panorama Mall in Panorama City, the discount-retailing giant took over the space last May, opening the first Wal-Mart in the Los Angeles market. Wal-Mart Stores Inc. purchased the outlet from Broadway's parent, Cincinnati-based Federated Department Stores Inc., in early 1997 for an undisclosed sum. Real estate sources estimated the sale at $2.3 million.

The arrival of the nation's only two-story Wal-Mart has injected new life in the area's sagging economy, attracting hundreds of applicants for the store's 300 jobs and bringing new traffic to the mall. The neighborhood has weathered a tough economic climate since the closure of the nearby General Motors assembly plant in 1992 and business departures following the 1994 Northridge earthquake. Now, merchants say they are optimistic that the success of the 165,000-square-foot retailer will spill over into their registers.

The opening also marked a shift in strategy for the Bentonville, Ark.-based company, which has long shunned moves into city centers in favor of sites on the outskirts, away from downtown merchants. Company executives say the store has exceeded sales expectations through the holidays, and that plans are under way for a second Wal-Mart in the San Fernando Valley, to be located in Porter Ranch.

- Nola L. Sarkisian

35. State Deregulates Electricity Industry

On March 31, the nation's largest attempt at electricity deregulation got underway in California. Over the next several years, deregulation is expected to completely transform the way businesses and residents pay for and use electricity.

But the beginning was far from smooth. First, computer problems pushed back the start date - initially set for last Jan. 1. Then the linchpin of the deal - a surcharge on electricity bills to cover the costs of bad investments by the state's three investor-owned utilities - came under attack on two fronts.

First, major outside power providers, like Enron Corp. and PacifiCorp, pulled back from the market, citing margins that would be too low. Then came an attempt by consumer activist Harvey Rosenfield to repeal the surcharge and impose a mandatory 20 percent rate cut, which would have effectively halted deregulation. The initiative was defeated only after utilities and the state's major businesses mounted a $40 million campaign against it, making it one of the costliest initiative battles in state history.

With the initiative now out of the way, deregulation is proceeding, albeit slowly. Several thousand businesses - mostly major power users - have switched providers. But that represents only a small portion of the 800,000 businesses and millions of households in California. The real competition is expected to begin in March 2002, once the surcharge expires and new players can reap higher margins.

By that time, the state's major municipal electricity providers - including the L.A. Department of Water and Power - are expected to join the fray. The DWP already has been positioning itself, having cut 2,000 jobs during the past year and secured language in the proposed city charter that would allow top staff members to sign contracts without approval from the DWP Commission.

- Howard Fine

36. Ovitz Launches Talent Agency

He's baaack.

Following an ill-fated stint as president of Walt Disney Co., Michael Ovitz is returning to a job that he knows well: overseeing the careers of movie stars.

The former head of Creative Artists Agency, who was once considered the most powerful agent in Hollywood, Ovitz has launched a new company, Beverly Hills-based Artists Management Group. It employs some of the hottest young managers in the business, including Rick Yorn, who represents Leonardo DiCaprio and Cameron Diaz. The goal is to expand on the boundaries of the talent business by incorporating advertising, corporate consulting and the new breed of business managers who are fast becoming the power players in Hollywood.

Ovitz's return leaves a sour taste in the mouths of some in the entertainment industry who consider him overbearing and egomaniacal (as opposed to everyone else in Hollywood). Nonetheless, the move is consistent with the man who managed to leave a troubled tenure at Disney with a $100 million severance package and who is now lobbying for a football franchise in L.A. Just like his former clients, Ovitz likes to stay in the picture.

- Nola L. Sarkisian

37. Ventura County Approves Ahmanson Ranch

It took more than a decade of on-again, off-again negotiations, planning and false starts. But the Ahmanson Ranch housing development finally got the nod in late November, when the Ventura County Board of Supervisors approved the massive project by a 2-1 vote.

Ahmanson Land Co., which will develop the $1 billion mini-city, will plan for 3,050 homes, 400,000 square feet of commercial space, a 300-room hotel, two golf courses and two schools on its 2,800 acres of land east of Oak Park.

While the project lies in Ventura County, its location just across the county line sparked opposition from San Fernando Valley residents in adjacent L.A. County, who argued that it would add congestion and pollution, strain already overtaxed water supplies, and provide little if any added tax revenues for their county.

The stalled project had been shelved during the region's economic downturn in the '90s. It received a major boost in September, when the Santa Monica Mountains Conservancy completed its assembly of nearly 10,000 acres of adjacent land to be preserved as open space. Preservation of the land helped ease over-development concerns, and fulfilled Ahmanson's 1992 agreement with Ventura County to leave a certain amount of land as open, public space.

In September, Washington Mutual Inc., which recently acquired Ahmanson Land's parent, said there is no time frame for the beginning of construction, and that the project would proceed as planned.

- D.B. Young

38. Westfield Buys TrizecHahn's Portfolio

Westfield America Inc. became the largest owner of regional shopping malls both in Los Angeles and statewide after its $1.4 billion acquisition of TrizecHahn Corp.'s portfolio was completed in November.

The deal added 13 more malls to Westfield's portfolio of 25 shopping centers. Three of the former TrizecHahn malls are in the L.A. area - Santa Anita Fashion Park in Arcadia, Los Cerritos Center and Fox Hills Mall in Culver City. Earlier this year, Westfield purchased The Promenade in Woodland Hills.

The acquisitions are strategic; owning more than one mall in a given area carries certain competitive advantages for marketing, company officials have said.

Brentwood-based Westfield, a publicly traded real estate investment trust with roots in Australia, specializes in turning around under-performing malls, as it did with the Westside Pavilion (which it no longer owns), Topanga Plaza and Eastland Shopping Center in West Carina. Its strategies include enclosing open-air strip centers or converting poorly performing malls into power centers.

Look for more changes at Westfield properties. The company plans to spend about $2 billion on improvements at its 38 shopping centers over the next 10 years.

- Elizabeth Hayes

39. Vulcan Materials Buys CalMat

The purchase of Los Angeles-based CalMat Co., an asphalt and ready-mix concrete producer, by Alabama-based Vulcan Materials Co. has created the nation's largest company specializing in sand, gravel and crushed stone (materials known in the industry as "aggregates").

Vulcan's $760 million cash purchase of CalMat is expected to be finalized during the first quarter. The newly merged company will be doing business in 21 states, taking advantage of a growing need for infrastructure projects. CalMat is also providing asphalt for the Alameda Corridor project connecting downtown L.A. with the ports of Los Angeles and Long Beach.

As part of the agreement, CalMat will become a subsidiary of Vulcan but will keep its name and stay in Los Angeles. Because the two companies are not in competition with each other, no production facilities are expected to be closed, officials said.

Vulcan has agreed to assume $130 million of CalMat debt, and in a tender offer that will expire Jan 1, it has offered to pay $31 a share for CalMat stock. Both companies' stocks have risen since the deal was announced.

- Karen Teitelman

40. New NBC Chief

One of the most coveted programming posts in television has gone to Scott Sassa, who replaces Warren Littlefield as president of NBC Entertainment.

Sassa, who was head of the network's television station group and before that built the entertainment cable arm of Turner Broadcasting System, takes the job amid significant turmoil at the network. After several years on top, NBC is struggling to keep its ratings position without such powerhouses as "Seinfeld" or a Sunday foot ball package. Indeed, NBC has seen its ratings fall further this season than any of the other major networks, as it struggles to compete with upstarts like Fox, The WB, an array of cable offerings and the Internet.

Some question whether the network's focus on bottom-line issues like program ownership and cost containment has dulled its creative edges. Like many of the current breed of TV executives, Sassa - who is expected to replace Don Ohlmeyer as president of NBC West Coast - is known more as a business strategist than a creative executive.

- Karen Teitelman

41. Port Pilots Sign New Contract

It had to have been the strangest strike in L.A. history. In July of 1997, the tiny harbor pilots union at the Port of Los Angeles, whose members are responsible for steering ships to their berths, walked off the job in a dispute over pay. For six months, two pilots did the work of 14, slowing harbor operations significantly and causing untold headaches for the nation's importers and exporters who rely on efficient port operations to move their merchandise.

The pilots returned to work in December 1997 after several months of heated negotiations with port officials, which included the filing of an unfair labor practices complaint against port chief Larry Keller. They finally signed their new contract in July, which raises annual salaries from the current $113,700 to $140,600 by 2001.

For the trade community, the labor dispute was powerful evidence of what can happen when the waterfront labor unions flex their muscles. The contract signing brought a sigh of relief that the disruptions caused by the 1997 walkout would not be repeated. The port pilots' dispute also raises the specter of what could happen this year, with the contract between shipping lines and thousands of dockworkers expiring in July.

- Larry Kanter

42. Farmer's Market Redevelopment

Seven long years after securing city approval, the Gilmore family announced that it would go ahead with a plan to develop a major shopping mall alongside its historic Farmer's Market in the Fairfax district.

The family has hired developer Rick Caruso to undertake the $100 million park-like project, to be called The Grove. It has been designed as a 640,000-square-foot mall of restaurants, movie theaters and upscale retail stores.

The Gilmores' selection of Caruso came as little surprise, considering he has developed some of the area's most successful retail projects in recent years - including the Commons at Calabasas, the Promenade at Westlake, and Encino Marketplace.

News of the project had originally alarmed local preservationists, who expressed concern that the project might involve razing the historic Farmer's Market. That collection of shops and stores has operated continuously since 1934, when farmers from the San Fernando Valley set up produce stands there.

Today, Farmer's Market - located at the corner of Third Street and Fairfax Avenue - has become a must-see on tour-bus routes, attracting an estimated 6 million visitors a year.

Caruso and the Gilmores have promised that the core of the existing Farmer's Market will remain intact, with The Grove being developed around it.

The Gilmores have been wanting to develop additional income-producing facilities on their property for years, but their earlier attempts were stymied either by local opposition, or by adverse economic conditions. This time, there's little excuse: The city's 1991 approval is still in effect and the area is booming.

- R.W. Greene

43. Perelman Buys Panavision

Ronald Perelman, the billionaire owner of the Revlon line of cosmetics, acquired a majority stake in Panavision Inc., the Woodland Hills-based maker of movie cameras and other accessories.

The $600 million deal, completed in June, gives Perelman a 72 percent stake in Panavision through a holding company. Perelman, who is worth an estimated $6.5 billion, later announced he would become the new chairman of the company at year's end.

Panavision dominates the movie camera business, building about 80 cameras a year, which it then rents to studios here and in foreign markets. But the company has experienced difficulties of late. For the third quarter ended Sept. 30, Panavision reported a loss of $700,000, compared with net income of $7.6 million in the like period in 1997. The poor performance was blamed on a decline in big-budget movie productions, which usually require the rental of large equipment packages and tend to have lengthier production schedules than smaller-budget films.

- R.W. Greene

44. Family Restaurants Buys Koo Koo Roo

Even Lee Iacocca couldn't turn Koo Koo Roo around. The former Chrysler Chairman was named chairman of the Los Angeles-based restaurant chain earlier this year in the hopes of fixing a company that had been without a profitable quarter since it went public in 1991. But in June, Koo Koo Roo agreed to be acquired by Irvine-based Family Restaurants Inc. to form a new chain with an estimated $540 million in annual sales at 313 restaurants in the United States.

Iacocca stayed on as a board member of the new company, as did Koo Koo Roo CEO William Allen. Kevin Relyea, who headed privately held Family Restaurants since 1995, was named chairman, president and CEO of the new company, to be called Koo Koo Roo Enterprises.

Koo Koo Roo sells a variety of fast food and prepared foods, such as skinless chicken. Aggressive cost-cutting couldn't stem the tide of red ink at the chain, which reported losses in 1997 of $29.4 million on sales of 68.3 million.

The much larger Family Restaurants, which operates 273 Chi-Chi's, Casa Gallardo and El Torito Mexican-food restaurants in 30 states, also has had its problems, losing $31.5 million in 1997 on sales of $463.7 million (although much of that loss was attributed to interest payments on debt).

Analysts said the merger was a good move for Koo Koo Roo, which will benefit from the financial and management muscle of the larger company.

- R.W. Greene

45. L.A. Opera Hires Domingo

Talk about your culture shock. Superstar tenor Placido Domingo surprised the opera world last fall by announcing that he will become artistic director of the L.A. Opera in 2000.

Domingo, already principal guest conductor and artistic adviser to the local opera company, will take over the top creative spot in Los Angeles while still serving as artistic director to the Washington, D.C. opera. Despite that commitment, as well as others to sing and conduct around the world - not to mention ownership of a New York restaurant - the 57-year-old said he will be able to fulfill his Los Angeles responsibilities in full.

Many of those responsibilities can be delegated, he said, and the administrative stuff will be handled by someone else. Domingo did concede that his upcoming L.A. gig will probably require him to reduce his performing commitments in Europe.

As a worldwide celebrity, his name will help considerably in fund-raising efforts, which the opera needs to survive. And as a Spanish speaker who was raised in Mexico, he can reach out to L.A.'s growing Latino community.

But to put on extravaganzas similar to those produced by other major city operas, Domingo will be hard pressed. L.A. Opera's annual budget is about $19 million, considerably less than that of Washington ($25 million) and a speck compared with New York's Metropolitan Opera ($170 million).

- R.W. Greene

46. New Coliseum Partners Hires NBBJ

It was L.A.'s Hail Mary of the year.

Sensing that its plan to bring NFL football back to the Memorial Coliseum was fading fast, a team led by developer Edward Roski Jr. hired architectural firm NBBJ last fall to come up with a new design for overhauling the venerable stadium.

NBBJ had to work fast because the decision to redesign was made just weeks before a crucial presentation to NFL team owners in Kansas City.

At that meeting, two competing proposals were presented: one led by former Hollywood superagent Mike Ovitz, which involves a Spanish-style stadium/mall in Carson to be called the Hacienda; and the other from a group looking to bring an NFL team to Houston.

Some NFL owners who previously had expressed doubts about renovating the aging Coliseum changed their tune upon seeing the last-minute redesign. Several said they were impressed by the 68,000-seat Coliseum's new look, which calls for 15,000 premier seats and 156 suites, as well as canopies draped over midfield seats for a more "intimate feel" and protection from the weather.

The reworked proposal included not only a renovated Coliseum, but additional improvements to the surrounding Exposition Park area. All the facilities would be connected by an aerial tram system running throughout the park.

NFL Commissioner Paul Tagliabue said the league will probably call a special meeting in February to consider the three proposals. A new franchise could be awarded as early as March.

- D.B. Young

47. Jerry West Signs New Deal

After months of speculation and rumors about his future, Lakers Executive Vice President Jerry West agreed to remain with the team, signing a four-year contract extension worth a reported $3.5 million per year.

The deal, which runs through the 2002-2003 season, makes West, 60, one of the highest-paid team executives who are not also coaches.

The future of West, who has brought such superstars as Shaquille O'Neal and Kobe Bryant to the franchise, first came into question in April. At the time, a published report indicated that he planned to leave in August - a year before his contract was due to expire - over concerns about a heavy workload and its effects on his health. West had previously said he would retire when his current contract expired in the summer of 1999.

West's history with the team goes back three decades, and includes 14 seasons as a player and 16 years in charge of the club's basketball operations - the longest such tenure in the National Basketball Association. The Lakers have won three championships in that time, and advanced to the finals seven times. He was also selected executive of the year by his peers in 1994-95.

In a news conference to announce the four-year extension, West admitted that he had received an "absolutely incredible" financial offer from elsewhere, but he declined to be specific. In announcing his contract extension, West added that he has no intention of ever seeking to leave the team again.

- D.B. Young

48. Office Depot Buys Viking Office Products

Consolidation in the office products industry claimed one of L.A.'s largest public companies in May, when Viking Office Products announced it would be acquired by Office Depot in a deal valued at about $3 billion.

The move marked the first big purchase for Office Depot, the nation's largest office supply store chain, since its proposed $4.3 billion merger with Staples Inc. fell apart over government regulators' antitrust concerns.

Torrance-based Viking was L.A. County's 26th largest publicly traded company this year, with revenues of $1.5 billion for the 12 months ended June 30. The company supplies a wide range of office products to small to medium-sized business, exclusively through catalogue sales.

The deal closed on Aug. 26, creating an office products giant with projected revenues of $8.4 billion. Viking continues to operate as a wholly owned subsidiary of Office Depot, with about 3,500 employees worldwide, including 500 in Southern California.

Analysts said the acquisition strengthens Office Depot's business-to-business sales market and gives it a strong inroad to the international market through Viking's 26 facilities in 11 countries. Viking has more than 2.5 million active business customers in the United States, Europe and Australia.

- D.B. Young

49. Wherehouse Buys Blockbuster Music

Wherehouse Entertainment Inc. is no longer singing the blues.

In an effort to boost its presence on the music-retail scene, the once-bankrupt music chain purchased Dallas-based Blockbuster Music for $115 million in cash in August, in a deal that makes Torrance-based Wherehouse the nation's second-largest music retailer.

Prior to the deal, Wherehouse operated 220 stores in seven Western states. The acquisition of Blockbuster's 378 music shops opens new markets for Wherehouse in Texas, Florida and Illinois. Both chains have their biggest presence in Southern California, where Blockbuster has operated 52 stores and Wherehouse about 70. For Blockbuster, meanwhile, the sale allowed its parent, New York-based entertainment giant Viacom, to ease the burden of its $2 billion in debt.

Since emerging from a two-year bankruptcy in 1997, Wherehouse has been on a rebound, posting earnings of $24 million in 1997 compared with $1.6 million the year before. Wherehouse also has begun branching out to ethnic markets, opening a series of "Tu Musica" stores in Latino communities.

- Nola L. Sarkisian

50. Quarterdeck Purchased by Symantec

A roller-coaster ride finally ended in October for Marina del Rey-based Quarterdeck Corp. when the utility software firm was purchased by its larger competitor, Cupertino-based Symantec Corp., for $65 million and the assumption of Quarterdeck's outstanding debt.

Quarterdeck had ranked near the top of the Business Journal's list of fastest growing public companies as recently as 1997. But buffeted by a slowdown in personal computer sales and tough competition from industry giants like Microsoft Corp., the company's fortunes plummeted. Its stock, which once traded for more than $30 a share, had fallen to less than $1 by last summer and the firm was about to be de-listed by Nasdaq before it was acquired by Symantec.

Symantec purchased Quarterdeck largely to obtain its well-regarded disk maintenance/utility program Clean Sweep, which received a PC Magazine Editor's Choice award this year. The acquisition will further consolidate Symantec's already well-established position in personal computer utility programs. The company already owned the popular Norton suite of anti-virus programs, as well as the communications programs WinFaxPro and pcAnywhere.

- R.W. Greene