Corporate Restructuring

Two years ago, Rexhall Industries Inc. was in overdrive. The Saugus motor-home maker, which opened in 1986, had seen its sales soar to $34 million in 1989--a year when nationwide shipments of recreational vehicles fell 2%. But in 1989 Rexhall's profits more than doubled to $2.27 million from $918,000 the year before.

Freedom Communications Inc., owner of the Orange County Register along with 89 other daily and weekly publications and eight TV stations, received court approval for a disclosure statement supporting its plan to emerge from Chapter 11 bankruptcy protection Thursday. The approval of the Irvine-based company's statement in a Delaware U.S. Bankruptcy Court gives Freedom the clearance to solicit votes on its reorganization plan from its creditors, the company said in a statement. A hearing to grant final approval to the reorganization plan has been set for March 9, the statement said.

Officials of the carpenters union headquarters in Washington took over several locals in Orange and Riverside counties Wednesday, surprising local union leaders. As the national union changed locks on doors and took control of records at the locals, union officials in this area were told that some locals will be merged and that all seven locals will be managed from Los Angeles.

Continuing to clean house and put his own executive team in place, Walt Disney Studios Chairman Rich Ross has ousted the studio's production chief, Oren Aviv, and is expected to name a successor shortly. Ross had approached Erik Feig, the production and acquisitions chief at Summit Entertainment who was the executive behind that studio's "Twilight" franchise, about the position. But Feig, who is under contract to Summit, declined the opportunity, according to Summit Chief Executive Rob Friedman.

The drastic reinvention plan that General Motors Corp. unveiled Monday would leave the onetime world goliath a smaller, leaner company -- with its legendary Pontiac brand discontinued -- but puts the automaker on a collision course with bondholders that could still land it in Bankruptcy Court. GM proposed a painful downsizing that would eliminate 21,000 workers, 2,600 dealers, $44 billion in debt and four brands -- while making the U.S.

Judy's Inc., a Van Nuys-based operator of 94 apparel stores in the western United States, has filed for reorganization under federal bankruptcy laws, Judy's president said Thursday. The privately held company thus becomes the latest casualty in retailing, where the recession--combined with excessive debt burdens in some cases--has forced such giant chains as R. H. Macy & Co. to seek protection from their creditors.

Reeling from intense competition that continues to eat away at its market share, Levi Strauss & Co. on Monday unveiled more details about several marketing and manufacturing thrusts aimed at reviving the 148-year-old company's faded image among fashion-conscious younger consumers.

Moving to capitalize on the fast-growing cat food market, H. J. Heinz Co. on Tuesday said it had divided its Star-Kist Foods Inc. subsidiary in Long Beach into separate canned seafood and pet food operations. The canned seafood unit, which makes Star-Kist tuna, will be known as Star-Kist Seafood Co. The pet food division, whose flagship brand is 9-Lives cat food, will be called Heinz Pet Products Co.

Kmart Corp., already in the midst of a massive effort to improve its stores, said Thursday that it plans to restructure its supply chain operations. As part of the restructuring, the discount retailer will move a distribution center from Carson to Mira Loma, Calif., and another from North Bergen, N.J., to Chambersburg, Pa.

Vans Inc. said Tuesday that it has agreed to settle a shareholders' lawsuit alleging securities violations. The footwear manufacturer also reported higher earnings and sales for the third quarter and nine months ended Feb. 24. The lawsuit, filed last June in federal court, sought class-action status to represent people who bought shares of Vans from June 27, 1994, to May 12, 1995.

Fourteen days after taking the helm as chief executive of General Motors, Edward E. Whitacre Jr. said the giant automaker, which went through a major bankruptcy restructuring this year, plans to repay loans from the U.S. and Canadian governments by the end of June. In one of his first face-to-face meetings with reporters at the company's headquarters in Detroit, Whitacre talked about a variety of topics, including his visit to an auto plant last week in Flint, Mich., shuffling top managers and the company's strategy of improving its vehicles, sales and brand image.

Chrysler, now known as Old Carco, filed a reorganization plan that gives nothing back to the U.S. for its $4-billion loan under the Troubled Asset Relief Program while repaying some secured lenders in full. The rough outline of a Chapter 11 plan, filed Tuesday in Bankruptcy Court in New York, said creditors classified as "other secured claims" of $20.6 million will get an estimated 100% recovery. The recovery for unsecured claims is "undetermined." The plan winds down Chrysler's 25 units that remained in bankruptcy after the sale of its most valuable assets to Fiat, which was completed June 10. The company isn't operating any businesses, and the plan would liquidate all remaining assets.

Three days after the ouster of Chief Executive Fritz Henderson, General Motors Chairman Edward E. Whitacre Jr. announced a deeper management shake-up at the automaker, naming new presidents for the company's North American, European and other international divisions. The moves come as GM attempts an ambitious comeback that began in Bankruptcy Court this spring. The government-owned company has dropped or sought to sell the Pontiac, Saturn, Saab and Hummer brands, closed hundreds of dealerships and laid off thousands of workers.

If you thought President Obama moved quickly, that's nothing compared with the first 50 days of the Ross administration. In less than eight weeks, Rich Ross has swiftly stamped his imprimatur on Walt Disney Studios. The novice movie chairman and his boss, Walt Disney Co. Chief Executive Bob Iger, want to create a new business model for Hollywood to address the sweeping changes that are roiling the entertainment industry, including slumping DVD sales and the growing role the Internet plays in movie marketing.

Signaling that infighting among creditors is bogging down reorganization efforts, Tribune Co. has asked a U.S. Bankruptcy Court in Delaware to give its management team until March 31 to craft a plan to exit Chapter 11 without interference from other parties. If all goes according to plan and the court agrees to extend management's "exclusivity" -- scheduled to expire at the end of this month -- Tribune will emerge from bankruptcy by May 31, 2010, according to court papers it filed Friday.

A high-level executive reshuffling at the Walt Disney Co. on Thursday will give Chief Executive Robert A. Iger a deeper bench from which to choose a No. 2. The restructuring came in advance of the company's fourth-quarter earnings announcement. Disney reported an 18% bump in income, fueled by gains in the television group that helped offset a loss at the film studio and softness in the theme park business. As part of the management changes, Chief Financial Officer Tom Staggs will trade jobs at the end of the year with Parks and Resorts Chairman Jay Rasulo.

It is extremely likely that in the next decade the United States will experience a period of social unrest unequaled in this century. It will dwarf the protests of the late 1960s and early 1970s. The recent strikes and other demonstrations in France are a portent of what is to come for us. Several things lead me to this dreary prediction: % The growing disparity between the nation's rich and its poor.

Emulex Corp., a manufacturer of computer products, blamed a corporate restructuring--including the dismissal of 10% of its work force--for an anticipated second-quarter loss of $14 million to $16 million. In Tuesday's announcement, the company for the first time put a price tag on restructuring efforts it announced in October. "This is not really earth-shattering news," said company spokesman Chuck McBride. "We knew this was coming."

Just a month after being named chairman of Walt Disney Studios, Rich Ross has carried out a broad restructuring of marketing, distribution and operations to reflect a focus on cultivating entertainment franchises -- and finding new ways to reach audiences through technology. The moves underscore a new set of priorities for the studio driven by Ross and Walt Disney Co. Chief Executive Bob Iger, who has taken a renewed interest in the film business since ousting former Disney Studios Chairman Dick Cook in September.

Chrysler has put bankruptcy behind it, but turmoil at the company continues. The troubled automaker on Monday replaced two top executives less than four months after promoting them and at the same time announced plans to split its Dodge brand in two, creating an all-truck Ram division. Although Chrysler said the departures of Peter Fong, formerly head of the Chrysler brand, and Michael Accavitti, who led Dodge, were voluntary, the moves raise questions about the focus of the company's business plan as it tries to rebuild.