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DETROIT BUSINESS MAIN 05-14-07 a 1 CDB.Qxd DETROIT BUSINESS MAIN 05-14-07 A 1 CDB 5/11/2007 6:23 PM Page 1 ® http://www.crainsdetroit.com Vol. 23, No. 20 MAY 14 – 20, 2007 $2 a copy; $59 a year ©Entire contents copyright 2007 by Crain Communications Inc. All rights reserved THIS JUST IN After study, Delphi drops Choice fuels power battle value of steering unit The potential sale price for Delphi Steering has fall- Utilities: We need certainty to build plants PROS AND CONS en since private-equity Advocates say competition has: BY AMY LANE electricity suppliers. fund Platinum Equity L.L.C. ■ Helped hold down electricity rates. CAPITOL CORRESPONDENT Advocates of the 2000 electric-choice law say agreed to buy the division ■ Encouraged independent power producers to competition has helped hold down electricity Jan. 31. LANSING — Business groups are taking on develop new plants. rates, encouraged independent power produc- Troy-based Delphi Corp. Michigan utilities in a battle that could ulti- ■ Provided millions of dollars in savings to ers to develop new plants and provided millions reported last week in its mately determine future Michigan electricity school districts, municipalities and small of dollars in savings to school districts, munici- businesses. first-quarter report that it prices and power plants. cut the division’s asset val- At the heart of the issue is whether lawmak- palities and small businesses that have gone to Opponents say electric choice: ■ ue by $152 million, or 28.6 ers should continue, or scrap, Michigan’s 2000 alternate suppliers. Benefits few customers. ■ percent, after due diligence law that allows customers of Detroit Edison Co. But others say electric choice benefits few Hasn’t delivered cheaper rates. by Los Angeles-based Plat- and Consumers Energy Co. to choose alternate See Electricity, Page 25 ■ Is a failed experiment. inum. The new value of the assets is $380 million. “Based on the ongoing sale and labor negotiations during March 2007, previ- ous estimates of sale pro- ceeds were reduced,” Del- Bon Secours a phi said in its report. Delphi Steering, which had 2006 sales of about $2.6 billion, is the largest busi- prize in hospital ness being sold by Delphi. The division doesn’t fit with Delphi’s strategy to emerge from Chapter 11 re- organization as a predomi- competition nantly overseas maker of automotive electronics. Delphi spokeswoman BY ANDREW DIETDERICH Claudia Piccinin declined to CRAIN’S DETROIT BUSINESS reveal how much Platinum is offering. St. John Health CEO Elliot Joseph says it’s essential Delphi Steering posted his health system is the winning bidder for Grosse an operating loss of $1 mil- Pointe-based Bon Secours Cottage and Health Services lion, excluding the asset to keep competition from moving into the neighbor- impairment, on revenue of hood about a mile from St. John Hospital & Medical Cen- about $693 million, accord- JOHN F. MARTIN ter. ing to the filing. Sergio Mazza has been SenSound’s main financial backer, and it was previously based at his house. A decision on the sale of Bon Secours’ east side The division saved about medical centers could be announced any day, Joseph $28 million in the quarter said. Bon Secours is owned by Bon after transforming its Secours Health System Inc., which is hourly work force from based in Mariottsville, Md. one dominated by veteran Joseph said buying Bon Secours workers earning $28 an Seeing sound is important because it needs to hour with full benefits to protect its health care territory on one with many new hires the east side of Detroit and in the earning half that wage. WSU spin-off gears up to commercialize tech Grosse Pointes. The transformation re- The system is spending $150 mil- lion on an expansion that includes sulted from General Motors combination of computer software, com- BY TOM HENDERSON an eight-story tower at its flagship Corp.-financed early retire- puter hardware and an array of micro- Joseph CRAIN’S DETROIT BUSINESS hospital, St. John Hospital & Med- ments and buyouts. phones to turn sound into something called ical Center, on Detroit’s northeast side. The deal has hurdles. It SenSound L.L.C., a Wayne State University near-field acoustic holography, basically a And, the health system has been defending its com- is subject to a bankruptcy spin-off that was founded in 2003, is moving 3-D hologram. mitment to the city of Detroit since it announced auction, court approval this week into leased space in the TechTown Engineers use the holograms to pinpoint April 24 that it plans to sell St. John Riverview Hospital incubator and research park near campus and negotiation of a new defects in manufacturing processes or fin- on Jefferson Avenue east of the Belle Isle bridge to as it makes the transition from research to deal with the United Auto ished products that result in such things as the Barbara Ann Karmanos Cancer Institute. Workers. commerce. dashboard vibrations. A current federal St. John followed that announcement last week by Platinum’s founder and The company’s technology was devel- grant is also funding research into using saying it would close most Riverview operations by CEO is Tom Gores, 42, who oped by Vice President and Chief Technol- the technology to reduce noise in factories. the end of June regardless of whether a sale is final- grew up in Flint. ogy Officer Sean Wu, who was named a dis- Company officials say early beta-test ized because of a declining number of patients and — Crain News Service tinguished professor of mechanical customers included Ford Motor Co., General reimbursements for care. The emergency room Motors Corp. and DaimlerChrysler Corp. An- See This Just In, Page 2 engineering at WSU in 2005. It allows man- ufacturers to “see” sound, using a patented See SenSound, Page 25 See Hospitals, Page 24 CRAIN’S LIST Innovations: 10 research Computer-service NEWSPAPER projects to watch, Page 11 companies, Page 16 DETROIT BUSINESS MAIN 05-14-07 A 2 CDB 5/11/2007 6:30 PM Page 1 Page 2 CRAIN’S DETROIT BUSINESS May 14, 2007 ed $2 million to UM to establish of Ferndale-based Paxahau Promo- Southfield-based Lear was work for both contracts will be THIS JUST IN the Barger Family Professorship tions Group L.L.C. said that’s up placed on the S&P’s credit watch performed in Sterling Heights. in 2005. slightly from 2006. in February after it accepted a — Sheena Harrison ■ From Page 1 — Sherri Begin Headlining the festival is $5.3 billion buyout agreement Moodymann, featuring Pitch Black from New York-based American 1Q passenger count up $1M budget cut at state City on May 26; Model 500, featur- Real Estate Partners L.P., a compa- Thomson Gale parent ing Detroit techno godfather Juan ny affiliated with investor Carl Ic- 2% at Metro Airport to be sold in $7.75B deal court of appeals Atkins on May 27; and Jeff Mills on ahn. May 28. Credit watch negative is a re- About 8.5 million passengers Stamford, Conn.-based Thomson The Michigan Court of Appeals is A full performance schedule view process that can result in a arrived or departed the Detroit Corp. said on Friday it was selling making $1 million in budget cuts and ticket details are at demf. credit rating downgrade. Metropolitan Wayne County Airport Thomson Learning, parent compa- that among other things will like- com. S&P also affirmed Lear’s ‘B” in the first quarter of 2007, ac- ny of Farmington Hills-based ly delay the appeals process. — Bill Shea corporate credit rating in Thurs- cording to the airport. Thomson Gale, to private-equity Chief Judge William Whitbeck day’s report. That’s up 2 percent compared and venture-capital firms Apax announced the cuts on Friday. — Sheena Harrison with the first quarter of 2006. Partners and Omers Capital Partners They include closing the court LaSalle HQ is LEED-certified Lester Robinson, CEO of the in a $7.75 billion deal expected to for at least eight days over the LaSalle Bank Midwest’s Troy Wayne County Airport Authority, said close in the third quarter. next four months, suspending a headquarters building earned a General Dynamics gets the increase in passenger count Thomson Gale is an online edu- program in which former staff at- LEED Gold certification for its $101M in contracts was due to a strong performance cation and information database torneys prepare research reports green building and business prac- by low-cost carriers and a resur- publisher. It’s unclear how and draft opinions on a contract tices. General Dynamics Land Systems gence by Northwest Airlines Corp. Thomson Gale’s 650 employees basis, suspending the expedited The building received the has received two contracts worth — Andrew Dietderich will be affected by the deal. track for appeals from summary Leadership in Energy and Envi- $101 million for Stryker vehicles and support, according to state- Apax declined to comment on disposition orders, effective May ronmental Design designation ac- ment issued last week. Burton-Katzman breaks the deal. Omers is a Canadian 7 and continuing a hiring freeze. cording to standards developed The Sterling Heights-based pension plan. Additional actions include by the U.S. Green Building Council. company received one contract ground for Fla. development — Bill Shea freezing some pay increases and The building has green roof, worth $42 million to supply Bingham Farms-based Burton- canceling longevity payments for heat recovery system, outdoor fountain that helps cool the build- Stryker Command Vehicles, and Katzman Development Co. broke JetBlue CEO gives UM $4.5M longer-term employees. another worth $59 million to pro- ground on University Professional — Amy Lane ing and other energy-saving fea- Recently named JetBlue Airways tures.
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