Investment Firm Agrees to Loan NEC $20 Million : Finance: Investor Richard C. Blum’s firm plans to purchase the amount in debentures to help reduce the Irvine company’s $54.5-million bank debt.

National Education Corp. said Monday that the San Francisco investment firm headed by wealthy investor Richard Blum has tentatively agreed to loan the struggling company $20 million.

Richard C. Blum & Associates and its clients intend to purchase $20 million in debentures in order to help reduce NEC’s $54.5 million in bank debt. The debt securities, which will pay Blum 9.1% interest over a 15-year period, can be converted to NEC stock at $4 a share.

The loan agreement will become final after NEC refinances its bank debt.

Blum, the husband of former gubernatorial candidate Dianne Feinstein, is an NEC director. He and his clients own approximately 9.7% of the Irvine-based vocational training and services company.

NEC has been trying to recover from a costly series of mix-ups involving several of its subsidiaries, particularly its Applied Learning International unit. The company has undergone a restructuring but continues to be hurt by poor sales.

NEC lost $1.3 million on revenue of $95.9 million for the three months ended Sept. 30, compared to a loss of $6.5 million on revenue of $94.2 million for the same period in 1989.

For the nine months ended Sept. 30, the company reported a net loss of $16.1 million on revenue of $269.3 million, compared to a loss of $1 million on revenue of $290.3 million in the same period last year.

NEC stock fell 12.5 cents Monday to close at $3.25 per share.

Blum’s investment in NEC became an issue in last year’s race for governor after it was disclosed that he had sold $2.7 million worth of the company’s stock just before a management shake-up that caused a drastic drop in the stock’s value.

NEC said it had concluded that there was no impropriety in the transaction. A Securities and Exchange Commission inquiry remains open.