Pacific Northwest Shares in Sound Financial, the newly organized holding company for Seattle's Sound Community Bank, will start being quoted...
Shares in Sound Financial, the newly organized holding company for Seattle’s Sound Community Bank, will start being quoted on the OTC Bulletin Board today, a day after the company completed a $12.97 million initial stock offering.
The nearly 1.3 million shares sold represent a 44 percent ownership stake in Sound Financial. One percent, or 29,480 shares, were contributed to a foundation; the remaining 55 percent is held by Sound Community MHC, a mutual holding company controlled by the bank’s depositors.
Most of the proceeds from the offering ultimately will flow to Sound Community Bank. The bank, which has five branches in the Puget Sound area, will use the money to repay short-term borrowings from the Federal Home Loan Bank of Seattle.
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Earth Class Mail
VC funding raises $13 million
Seattle-based Earth Class Mail, which scans postal mail and delivers it online, said Tuesday it raised $13.3 million in venture capital.
The first round will be used to open new facilities in about 12 North American cities and to increase marketing and product development. The round was led by Ignition Partners.
Hawkeye leads investment round
Woodinville-based Loctronix, which has been quietly operating for the past two years, said Tuesday that it has raised $1 million to go toward a second round of funding.
Its initial investor is Hawkeye Investments, a firm owned by John Chapple, the former chief executive of Nextel Partners. Loctronix Chief Executive Michael Mathews said the round would likely increase to about $2.7 million.
Mathews said Loctronix was spun out of Engenex Technologies, another company he founded in Kirkland. He said Loctronix is developing technology to install on cell towers or in buildings that would allow global positioning systems to work indoors and become more accurate.
Czech Republic to soon get store
Starbucks will open its first outlet in the Czech Republic at the end of this month with its joint-venture partner, AmRest Holdings.
The store will open on Malostranske square, near the Prague castle, the companies said in a statement Monday.
Slowdown report causes shares to fall
AT&T’s shares tumbled Tuesday afternoon after Chairman and Chief Executive Randall Stephenson said the telecom carrier is experiencing some slowdown in its consumer-business segments.
Speaking at Citi’s Entertainment, Media and Telecom Conference, Stephenson said the bulk of the weakness is coming from service disconnections due to customers’ nonpayment of bills on its access lines and home broadband services.
But he added that so far, the slowing U.S. economy has not hurt the company’s wireless or enterprise businesses.
On the whole, Stephenson said, AT&T’s business will continue to grow, driven by wireless strength, increasing broadband penetration and Internet Protocol TV. AT&T expects to have more than 1 million subscribers to its U-Verse television service by the end of this year.
AT&T’s shares fell $1.87, or 4.6 percent, to $39.16 Tuesday. In the past 52 weeks, the stock has traded between $33.20 and $42.97.
Stock falls 28.4%; firm denies rumor
Shares of Countrywide Financial, the nation’s largest mortgage lender, plunged Tuesday after the company denied rumors it was planning to file for bankruptcy protection.
The stock fell $2.17, or 28.4 percent, to $5.47 on Tuesday after sinking to a 52-week low of $5.05.
In a prepared statement earlier in the day, the company said there was “no substance to the rumor that Countrywide is planning to file for bankruptcy, and we are not aware of any basis for the rumor that any of the major rating agencies are contemplating negative action relative to the company.”
The stock was shaken by a report in The New York Times that said court records show the lender fabricated documents related to a bankruptcy case of a borrower in Pennsylvania.
Other Countrywide actions in borrowers’ bankruptcy cases have come under scrutiny in the past.
Investors have been particularly anxious about Countrywide in recent days. Its stock is well below its 52-week high of $45.26.
2,400 jobs to be cut in restructuring
Avon Products on Tuesday said it will cut 2,400 jobs as part of its multiyear restructuring plan, which it said will cost more than originally expected and ultimately save the beauty-products maker $430 million annually.
Avon unveiled its restructuring in November 2005. It involved steep job cuts, the elimination of management layers and the realignment of manufacturing centers and outsourcing work to countries with cheaper labor costs.
Publisher says it will cut 611 jobs
McGraw-Hill, a major educational publisher that also owns the Standard & Poor’s credit-ratings agency and BusinessWeek magazine, said Tuesday it is cutting 611 jobs, resulting in a fourth-quarter charge of $43.7 million.
The job cuts will come across the company’s divisions and will reduce its after-tax earnings by 8 cents per share, the company said in a statement. About half of the job cuts will come in its education division.
McGraw-Hill attributed the cuts in its financial-services division to current business conditions, which were affecting both the credit-ratings services and other businesses of Standard & Poor’s.
McGraw-Hill shares fell $1.86 to $40.52 a share.
Shares of grocer drop more than 16%
Shares of Supervalu, one of the nation’s largest grocers, dropped more than 16 percent Tuesday after it suggested that financial pressure was hurting its customers and it reduced its full-year guidance.
The sell-off came as the company behind the Albertsons, Shop ‘n Save, Jewel-Osco, and other store brands reported that its third-quarter profit rose almost 25 percent.
Chairman and Chief Executive Jeff Noddle said it expects consumer spending will continue to be pressured by inflation, as it was during the third quarter.
Supervalu shares fell $5.68, or 16.6 percent, to close at $28.61.
Sirius / XM
Merger may not be OK’d this month
Sirius Satellite Radio Chief Executive Officer Mel Karmazin said he’s unsure if regulators will approve the proposed acquisition of XM Satellite Radio this month.
“I’m not saying we expect it to close in January,” Karmazin, head of the second-largest satellite-radio service, said at a Citigroup investor conference in Phoenix on Tuesday. “But we should be able to close.”
Sirius’ offer to buy its larger rival for $4.31 billion in stock is subject to approval by the Justice Department’s antitrust division and the Federal Communications Commission (FCC). Sirius and XM had expected the deal to close by the end of 2007.
Karmazin said Sirius has complied with Justice Department requests for information and has submitted “over 6 million pieces of paper.” He added, “Their answer is they have a lot of information to go through.”
The Justice Department, which often rules before the FCC on mergers, has also sought information from Sirius’s automotive and retail partners and the personalities who host its programs, Karmazin said.
Compiled from Seattle Times staff, The Associated Press and Bloomberg News