DETROIT BUSINESS MAIN 05-14-07 A 1 CDB 5/11/2007 6:23 PM Page 1

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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. vide parts and support for the Park, an 85,000-square-foot office Stryker vehicle and its remote development in Sarasota, Fla. Corp. CEO David Barger has made a — Jennette Smith $4.5 million gift to the University of Music festival organizers expect weapon station system. The development includes two Michigan to endow the Barger The contracts were awarded by office buildings and a site for a re- Leadership Institute in the Orga- to draw 45,000 Standard and Poor’s takes Lear the U.S. Army TACOM Life Cycle tail tenant, restaurant or a bank. nizational Studies Program. The organizers of Movement, off credit watch negative Management Command. Part of the — Jennette Smith The gift will fund international this year’s Detroit Electronic Music fellowships, internships in global Festival, are planning for a crowd Lear Corp. has been removed organizations and research that of about 45,000 in Hart Plaza over from Standard and Poor’s Rating CORRECTIONS examines leadership and global the three-day event scheduled for Services credit watch negative, ac- Ⅲ The last name of photographer Michael Spleet was misspelled on organizations for undergraduates. Memorial Day weekend. cording to a research report is- Page 29 of the May 7 issue. Barger, a UM alumnus, donat- Festival director Jason Huvaere sued Thursday.

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May 14, 2007 CRAIN’S DETROIT BUSINESS Page 3 NAIC CEO to CRAIN’S Catalogs take hit INDEX Solid quarter: Michigan retire in June companies’ 1Q earnings do better than national numbers. Page 4. Exit comes as from postal hike nonprofit tries

Higher rates set to take effect today Josic Tibbitts to calm Getting Webby: Privatas Equity co-founders start BY SHEENA HARRISON $50M fund focused on CRAIN’S DETROIT BUSINESS POSTAGE RATE CHANGES early-stage Web firms. internal strife Page 20. Businesses that mail catalogs to their customers Postal rates are based on several factors, including BY SHERRI BEGIN are expected to be hit the hardest by new postage weight and sorting methods. The following are rates These organizations appear in this CRAIN’S DETROIT BUSINESS rates that take effect today. for some commonly used mailing formats. week’s Crain’s Detroit Business: Under a rate case filed last year by the U.S. Postal Before After Richard Holthaus is stepping down as Service’s board of governors, postage rates for most 1 ounce first-class mail 39¢ 41¢ chairman and CEO of the National Association Advanced Technology & Testing . . . 25 mail categories will increase this week. 2-ounce first-class mail 63¢ 58¢ Agree Realty ...... 4 of Investors Corp., following several years of 3.3-ounce standard flat mail 27.5¢ 33.5¢ American Mailers Inc...... 3 controversy involving conflicts of interest For example, a lightweight catalog weighing 3.3 ounces or less could cost 33.5 cents to ship now, up 4-ounce standard flat mail 27.8¢ 33.5¢ ArvinMeritor Inc...... 4 in the nonprofit’s and its parent trust’s oper- ASC Inc...... 23 22 percent from 27.5 cents previously. A 4-ounce ations and compensation of Holthaus and Bon Secours Cottage Health Services . . 1 other executives. catalog could now cost 33.5 cents to mail, up 20.5 “I think what people are going to do is get Clark Hill plc ...... 3 He is the fourth executive or board mem- percent from 27.8 cents. smarter in what they mail, more selective in their CMS Energy Corp...... 4, 25 ber to step down since a lawsuit was filed First-class stamps have increased from 39 cents lists,” Katz said. Comerica Inc...... 4 Commodity Sourcing Group...... 21 against the trust more to 41 cents. The changes will affect companies such as Direct mailers that work with businesses that Compendia Biosciences ...... 11 than two years ago and Zingerman’s Mail Order in Ann Arbor, which sends Constellation NewEnergy ...... 25 the U.S. Senate Finance bulk-mail catalogs say they expect companies will about 1.6 million catalogs to customers each year. Consumers Energy Co...... 1 Committee launched an in- seek to cut costs The company has been working with a catalog con- Customer Choice Coalition ...... 25 vestigation into its opera- “They’re going to reduce the number of people sulting company in Texas to help budget for up- Data Driven Marketing Inc...... 3 tions after receiving on their catalog list,” said Clark Keller, president coming postal increases, Managing Partner Toni Delphi Corp...... 1, 4 whistleblower complaints of Data Driven Marketing Inc. in Novi. Morell said. Detroit Edison Co...... 11 Detroit Electrical Services ...... 21 of excessive compensa- Jeffrey Katz, CEO of Detroit-based American Mail- “They’re always aware of what’s in the water,” DTE Energy Co...... 25 tion and conflicts of inter- ers Inc., agrees. The company specializes in direct said Morell, who said that Zingerman’s Mail Order FMF Capital L.L.C...... 22 est between board mem- marketing and bulk mail, and works with clients expects sales of $7.5 million this year. “We’re never Grow Online L.L.C...... 20 Holthaus bers and management. such as DaimlerChrysler AG, Blue Cross Blue Shield of surprised.” Henry Ford Health System...... 24 Holthaus, 60, said in a Michigan and all three Detroit casinos. See Postage, Page 23 Incubation Group Inc...... 20 news release he is retiring to spend more Integrated Media Technologies. . . . 21 time with his family but plans to remain a IntellaPic L.L.C...... 20 Karmanos Cancer Institute . . 1, 14, 24 volunteer for NAIC in his hometown of St. Lawrence Technological University . 15 Louis. Lear Corp...... 4 NAIC trustees named Beth Hamm, daugh- Loomis, Sayles & Co. L.P...... 4 ter of NAIC founder George Nicholson, as in- Masco Corp...... 4 terim chairman while they launch a nation- McGraw Wentworth ...... 3 al search for a new chairman and CEO. Michigan AFSCME Council 25. . . . . 24 Stuck on Michigan Public Service Commission25 Bonnie Reyes, president and COO of Michigan State University...... 12 NAIC, will oversee all operations and pro- Moosejaw Mountaineering ...... 23 grams in the interim, NAIC said in a news NAIC ...... 3 release. National Logistics Management . . . 21 Holthaus’ resignation, effective June 30, Oakwood Healthcare System...... 24 comes just one month after a two-year law- Origen Financial Inc...... 4 suit filed against NAIC’s parent trust was Pacific Pay Day L.L.C...... 20 health costs Piston Group ...... 21 settled in Oakland County Probate Court. Plymouth Venture Partners I L.L.C. . 20 Two former trustees of the trust dropped Efforts to slow growth stalled Poly Flex Products Inc...... 25 their litigation against NAIC Trust last Privatas Equity Holdings L.L.C. . . . . 20 month, following reforms in the way it oper- Pulte Homes Inc...... 4 ates. PVS Chemicals Inc...... 24 Ralph Seger, chairman emeritus of at 6 percent a year, local survey says Questor Management Co. L.L.C. . . . 23 Ramco-Gershenson ...... 4 Bloomfield Hills-based money-management BY BILL SHEA and 368 responded. Randolph Miller Associates ...... 23 firm Seger-Elvekrog Inc., sued the trust in Feb- Seger-Elvekrog Inc...... 3 CRAIN’S DETROIT BUSINESS The biggest surprise from ruary 2005, claiming he was wrongfully dis- SenSound L.L.C...... 1 this year’s results, collected missed from its board of directors. At the Progress by Southeast Michi- St. John Health...... 1 from January to April, was how Taubman Centers Inc...... 4 time, he was 84. gan employers in their effort to little the key metrics, such as TechTown...... 11 Warren Alexander, another trustee, control health care costs has joined the case later that year, demanding deductibles and co-pays, have The Detroit Medical Center...... 24 slowed, a survey scheduled to University of Detroit Mercy . . . . 12, 13 changes in the way the trust and its nonprof- changed, McLaughlan said. be released today shows. University of Michigan . 11, 12, 14, 15 it affiliate, NAIC, which does business as “There were some tweaks, The average cost for employ- but they were fairly constant,” University of Michigan-Dearborn . . 13 Better Investing, operate. Vision IT...... 21 er-provided group health bene- she said of the results com- Seger agreed last month to drop his appeal THE WEIGHTY COST OF CARE Visteon Corp...... 4 of a decision that he was properly removed fits increased by 6 percent for pared with 2006. Wayne State University . . 1, 11, 14, 15 from NAIC’s board, and Alexander, 84, Other findings from the McGraw the second consecutive year, There may be so little move- William Beaumont Hospitals...... 24 agreed to drop the suit and resigned from Wentworth survey: according to the fourth annual ment in benefits because South- Wireless Washtenaw...... 21 east Michigan companies have Zingerman’s Mail Order ...... 3 the trust’s board following the settlement. ■ Wellness programs such as McGraw Wentworth Mid-Mar- a higher percentage of union- Alexander’s attorney, Tom Sweeney, a weight-loss and smoking-cessation ket Group Benefits Survey. ized employees, McLaughlan member of Clark Hill plc, said last month, “We programs are growing more The increases have leveled off said, and multiyear contracts BANKRUPTCIES ...... 7 believe we’ve accomplished some substantial popular among companies as ways after dropping from 11 percent tend to keep health care costs BRIEFLY ...... 21 changes within the organization. (Alexan- to cut costs. in 2004 and 9 percent in 2005. BUSINESS DIARY ...... 16 stable over the life of the deal. der’s) goal all along has been to reform the in- Next year also is expected to CALENDAR ...... 17 ■ The median benefit-level PPO About 30 percent of respon- ternal organizational arrangement, to pro- have a 6 percent average in- CAPITOL BRIEFINGS ...... 7 plan cost a total of $5,736, with a vide more input from members.” dents had some form of orga- CLASSIFIED ADS...... 18 cost split of 64 percent from the crease, said Becky McLaughlan, Since the lawsuit began, the trust has re- nized labor as part of the work- KEITH CRAIN ...... 8 employer and 36 percent for the principal at McGraw Wentworth. vised its bylaws to limit the number of man- force. Nationally, about 7 LETTERS ...... 8 The Troy-based employee- OPINION ...... 8 agement trustees on the board to no more employee (15 percent from payroll percent of private industry deductions for premiums and 21 benefit-consulting company workers belong to unions. OTHER VOICES ...... 9 than 25 percent of the total 12-16 board mem- surveyed 1,200 Southeast PEOPLE ...... 20 bers, providing more independent directors, percent for out-of-pocket Use of wellness strategies to payments.) Michigan employers with be- RUMBLINGS...... 26 See NAIC, Page 24 tween 100 and 10,000 employees, See Health care, Page 24 WEEK IN REVIEW ...... 26 DETROIT BUSINESS MAIN 05-14-07 A 4 CDB 5/11/2007 5:57 PM Page 1

Page 4 CRAIN’S DETROIT BUSINESS May 14, 2007 TAKING STOCK ACSsalutes... NEWS ABOUT DETROIT AREA PUBLIC COMPANIES Metro Detroit's business community for taking a State companies beat national stand against cancer and investing in their employee's health through the American Cancer Society Workplace Solutions Program. counterparts in first quarter Call 248.557.5353 or visit www.workplacesolutions.com to learn how to impact chronic disease and your bottom line. BY TOM HENDERSON of $185.2 million. CRAIN’S DETROIT BUSINESS 1ST QUARTER EARNINGS In the first quarter of 2006, those AAA Life For complete results visit www.crainsdetroit.com 53 companies totaled $427.1 million ALCOS Michigan’s public companies Without Ford and GM; in net income. Excluding the auto Allen Park Public Schools did surprisingly well in the first 51 reporting companies. makers, income totaled $1.2 billion. quarter, outperforming their ASC Incorporated $1.2 There was other good news. Automated Benefit Services counterparts nationally, accord- billion Even in the troubled auto-sup- Beaumont Cancer Institute ing to David Sowerby, portfolio plier sector, five of 10 companies re- Bon Secours Cottage Health Services manager and chief market analyst ported improved earnings over the Botsford Hospital in the Bloomfield Hills office of first quarter last year. “Overall, Loomis, Sayles & Co. L.P. auto suppliers have had some de- Bright House Networks “People have been conditioned 84.6% cent earnings news,” Sowerby said. Campbell-Ewald by the stomach punches of the dai- $185.2 million All four real-estate investment City of Sterling Heights ly headlines. We begin to think 2007 2006 trusts to report so far — Agree Real- Comcast Communications we’re losing everywhere,” he said. ty, Origen Financial Inc., Taubman With Ford and GM; Comerica “But for the most part, we fared 53 reporting companies. Centers Inc. and Ramco-Gershenson Crittenton Hospital Medical Center much better than I would have — had higher net incomes. thought. On a grade basis, this $427.1 The six reporting high-tech DTE Energy million First State Bank would be the perennial C student companies saw net income rise who just brought home a solid B.” from $112.5 million to $134.9 mil- Flagstar Bank Of the first 57 state companies to Ford Motor Company lion, led by Rofin-Sinar Technologies report earnings, Sowerby said, 108.1% Inc., which went from $99.7 million Garden City Hospital mean net income was up over the to $116.1 million. “There were General Motors Corporation first quarter of 2006 by 14 percent, $34.8 million modest surprises in our small pool Gershenson Radiation Oncology Center compared with 11 percent nation- of tech stocks,” said Sowerby. 2007 2006 wide. Through Thursday, he said “Tech was better than expected.” Henry Ford Hospital - Wyandotte Source: Individual companies Henry Ford Medical Center - Fairlane the average stock price for Michi- Despite a squeeze on net-inter- Henry Ford Medical Center - West Bloomfield gan companies was up 7 percent, come of $262.7 million to a loss of est margin and fears over the Highland Township compared to 6.4 percent for the $85.7 million; CMS Energy Corp., housing sector, financial institu- Huron Valley Sinai Hospital Standard & Poor’s 500, and return which went from a loss of $27 mil- tions held their own, with 14 com- on equity was 20 percent, com- lion to a loss of $215 million; and panies reporting combined net in- Johann A. Krause pared to 21 percent for the S&P. Masco Corp., whose income dropped come of $276.5 million, just off Johnson Controls “This is a case of low expecta- from $204 million to $143 million. from $281 million. Josephine Ford Cancer Center tions which surprised on the up- “You look at some of the home- “The story there is that a lot of Josephine Ford Cancer Center - Downriver side,” he said. building-related companies like banks are finding that credit quali- Karmanos Cancer Institute Total earnings were skewed, Pulte and Masco, and those people ty is looking pretty good despite Lincoln Park Chamber of Commerce though, by a handful of large losers. are suffering,” said Dana Johnson, the weakness in the Michigan Lincoln Behavioral Services Big decliners in the recent quar- chief economist at Comerica Inc. economy,” Johnson said. “Most Livonia Chamber of Commerce ter included Visteon Corp., which As a result, the first 53 public banks’ credit quality has held up went from $3 million in net income companies to report earnings that surprisingly well. The economy is Livonia Family YMCA to a loss of $153 million; Delphi Corp., Crain’s tracks in Southeast Michi- not tumbling into recession.” Mach 1 Air Services, Inc. which went from losses of $363 mil- gan had a combined loss of $34.8 Overall, Sowerby said, “state Maisel Women's Health Center lion to $533 million; ArvinMeritor Inc., million, counting Ford Motor Co. stocks underpromised and overde- Metaldyne which went from income of $45 mil- and General Motors Corp. Not in- livered.” Mount Clemens Regional Medical Center lion to a loss of $94 million; Pulte cluding the automakers, local com- Tom Henderson: (313) 446-0337, Northville Township Homes Inc., which went from in- panies had combined net income [email protected] Oakwood Healthcare System Orchard, Hiltz, and McCliment, Inc. TREET ALK Pontiac Osteopathic Hospital 3 Lear lawsuits dismissed S T Providence Hospital THIS WEEK’S STOCK TOTALS: 31 GAINERS, 41 LOSERS, 10 UNCHANGED Quest Diagnostics Three lawsuits filed in Oakland County Circuit Court against Lear 5/11 5/4 PERCENT Quicken Loans CDB’S TOP PERFORMERS CLOSE CLOSE CHANGE Real Estate One Corp. were dismissed Wednesday Romeo RIM, Inc. by Judge Fred Mester, according 1. Veri-Tek International Corp. $7.98 $7.25 10.07 to Joseph Aviv, partner for Honig- 2. Champion Enterprises Inc. 11.31 10.64 6.30 Saint-Gobain Abrasives man Miller Schwartz and Cohn L.L.P. 3. ITC Holdings Corp. 45.53 43.55 4.55 Security Police Fire Professionals of America The three lawsuits were filed in 4. TRW Automotive Holdings Corp. 38.79 37.35 3.86 Somerset Collection February by shareholders against 5. TechTeam Global Inc. 13.20 12.73 3.69 St. John Health Lear in an attempt to block a $5.3 6. Sun Communities Inc. 30.90 30.10 2.66 St. John Macomb Hospital billion buyout offer from compa- 7. Flagstar Bancorp Inc. 12.70 12.42 2.25 St. Joseph's Healthcare nies affiliated with legendary cor- 8. Borders Group Inc 22.47 22.00 2.14 St. Joseph Mercy Oakland porate raider Carl Icahn. The law- 9. Michigan Heritage Bancorp Inc. 12.00 11.75 2.13 St. Mary Mercy Hospital suits were later consolidated into 10. Noble International Ltd. 18.19 17.82 2.08 one case. The nailco group CDB’S LOW PERFORMERS 5/11 5/4 PERCENT The Private Bank The plaintiffs argued that Lear’s CLOSE CLOSE CHANGE The Suburban Collection board members breached their 1. Domino’s Pizza Inc. $20.01 $32.37 -38.18 fiduciary duties by failing to go 2. Rockwell Medical Technologies Inc. 6.00 6.84 -12.28 The Timken Corporation through a sale process that would Volkswagen of America 3. Valassis Communications Inc. 17.59 19.00 -7.42 attract the best and highest offer 4. Saga Communications Inc. 9.27 9.98 -7.11 Weisberg Cancer Treatment Center when they accepted a buyout offer Weyerhaeuser 5. Energy Conversion Devices Inc. 34.80 37.41 -6.98 from New York City-based Ameri- 6. Syntel Inc. 34.20 36.55 -6.43 can Real Estate Partners L.P. 7. Clarkston Financial Corp. 12.90 13.70 -5.84 Three Delaware lawsuits have 8. FNBH Bancorp Inc. 23.50 24.80 -5.24 also been consolidated into a sin- 9. General Motors Corp. 29.46 30.88 -4.60 gle case and a hearing to consider 10. Citizens Banking Corp. 20.06 20.71 -3.14 the shareholder’s request to delay Hope. Progress. Answers. Source: Bloomberg News. From a list of publicly owned companies with headquarters a vote on the buyout is scheduled in Wayne, Oakland, Macomb, Washtenaw or Livingston counties. Note: Stocks trading 1.800.ACS.2345 / www.cancer.org for June 6, Aviv said. at less than $5 are not included. — Brent Snavely DBpageAD.qxd 5/3/2007 4:04 PM Page 1

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Page 6 CRAIN’S DETROIT BUSINESS May 14, 2007 Crain’s announces staff changes

Crain’s Detroit Business has been active in tivities. ing Crain’s. ously, Smith worked for The Ma- made several staff additions and the Ann Arbor Lee joined Jennette comb Daily, The Times Herald of changes to improve and expand its community. He Crain’s in 1999 Smith, 32, has Port Huron and the Muskegon print and Web coverage. is a graduate of as a copy editor been promoted Chronicle. She is a graduate of MSU. Andy Chapelle, 57, has joined Eastern Michi- and most recent- to assistant Brent Snavely, 37, has been Crain’s as managing editor and gan University ly was deputy managing editor named senior reporter in recogni- will lead the reporting staff. and has a mas- managing edi- for Crain’s tion of superior Chapelle had been editor of the ter’s degree from tor, leading the weekly Focus performance Ann Arbor Business Review and Michigan State copy desk. The sections that and leadership. was founding editor of the Oak- University. copy desk is re- target specific Snavely land Business Review. He previous- Chapelle Michael Lee, Lee sponsible for fi- Smith industries, as joined Crain’s ly spent about 20 years with The 35, has been pro- nal editing of Web and print sto- well as small business and topics in 1999 and has Ann Arbor News, finishing there moted to Web general manager. In ries, as well as designing pages related to entrepreneurship. covered several as news editor. that position, he will lead the Web and writing headlines. Smith joined Crain’s as a reporter industries. He Chapelle is a former board mem- team of Dan Eizans and Ai-Ting Lee is a graduate of MSU and in 1998 and has covered several in- will continue in ber of The Associated Press Man- Huang and have responsibility for worked at The Oakland Press in dustries for Crain’s, most notably his current cov- aging Editors Association and has overall newsroom Web-related ac- Pontiac for five years before join- real estate and hospitality. Previ- Snavely erage areas of automotive sup- pliers, steel and restaurants. Before joining Crain’s, Snavely had been a business reporter for The Advocate in Newark, Ohio. He is a graduate of Wittenberg Univer- sity in Spring- Who can save any business field, Ohio, and Q: also attended graduate school at Ohio State University. Also, reporter up to 30% on health care? Sherri Begin is one of 20 jour- nalists selected Begin nationwide to participate in a competitive-application seminar on nonprofit reporting underwrit- ten by the McCormick Tribune Foun- dation. Begin, 37, has covered non- profits since joining Crain’s in 2003 from sister publication Rub- ber & Plastics News. She is a grad- uate of Northern Michigan Uni- versity. A:

WE’RE LOOKING FOR HEALTH CARE HEROES Crain’s Detroit Business is seeking nominations for Health Care Heroes, a special section in the Aug. 6 issue. Winners will be named in the following categories and recognized during a September 19 luncheon: Corporate achievement in health care: Honors a company that has created an innovative health benefits plan or that has solved a problem in health care administration. Advancements in health care: Honors a company or individual responsible for a discovery or for development of a new procedure, device or service that can save SM lives or improve quality of life. HAP’s Value Plans can save you up to 30% off your Physician: Honors a physician current health care premiums. How? Our alternative plan Introducing whose performance is considered designs feature higher deductibles and co-insurance that exemplary. Allied health: Honors an reduce your premiums. Your employees continue to have individual from nursing or allied access to leading hospitals and physicians along with health fields deemed exemplary by SM patients and peers. consumer-friendly online health informational tools, A panel of health care judges will preventive care coverage and optional Health Savings choose the winners. Sponsors of SM the event include Fifth Third Bank, $FFRXQW +6$ +$3·V9DOXH3ODQV help offer Academy of the Sacred Heart and predictability with the cost savings you seek. powered by the Michigan State University Management Education Training Center in Troy. Online nomination Great benefits and coverage with no hidden costs. forms can be found at Now that’s value. www.crainsdetroit.com, under the “Forms and Surveys” headline in the left-hand column on the home page. The deadline to nominate is June 8. Contact your Agent or Account Executive or call (800) HAP-PLUS toll-free. Call Jennette Smith at (313) 446- 1622 for more information. DETROIT BUSINESS MAIN 05-14-07 A 7 CDB 5/11/2007 5:56 PM Page 1

May 14, 2007 CRAIN’S DETROIT BUSINESS Page 7 Tax, budget agreements possible this week

LANSING — Business- House Speaker Andy Plans last week urged the Legisla- and uncovered cost will accrue to from a 4 percent statewide liquor tax and budget discussions Dillon, D-Redford Town- ture and administration to agree on other payers of health care. tax and a hotel-motel tax levied in are accelerating in the ship, said a confidentiality additional revenue as part of the Increasing the cost of health care Wayne, Oakland and Macomb Capitol, with developments agreement between Bish- current-year budget solution “in or- is the wrong message to be sending counties, pays as its first obligation on both issues possible this op, Gov. Jennifer der to avoid creating permanent to Michigan’s businesses,” said Ro- the debt service on bonds issued to week. Granholm and himself pre- harm to Michigan’s health care sys- man Kulich, president of the associ- expand Cobo Center in Detroit. On the business-tax side, vents public discussion of tem.” ation and CEO of Molina Healthcare the Senate and House have Under the measure in Senate Bill specific items. But, he said, The association said a proposed of Michigan Inc., in a news release. formed a joint work group 220, the Cobo-related payments House Democrats “were cut in Medicaid provider rates will One budget item that’s drawn to discuss each chamber’s would be untouched. But counties’ talking about cuts and re- both limit access to essential health some interest is a measure in a bud- proposals to replace Michi- forms and revenues from care and cost more than its project- get bill before a House-Senate con- payments out of the convention fa- gan’s single-business tax, CAPITOL BRIEFINGS day one. The only twist is ed savings. ference committee that would redi- cility fund would be reduced by 50 in the wake of the passage Amy Lane whether revenues kick in “Michigan will most likely offset rect $18.4 million that counties percent, with $18.4 million instead of competing plans, as Crain’s re- before the end of the fiscal year.” any savings realized by the pro- would otherwise receive from going into Michigan’s general fund ported last week. He said he hopes to reach a bud- posed reductions by increased ex- Michigan’s convention facility de- for the current fiscal year. “I think in the end there will be get agreement this week. penditures in hospital emergency velopment fund. Amy Lane: (517) 371-5355, some sort of compromise between The Michigan Association of Health the two plans,” said Matt Marsden, departments’ cost. This increased The fund, which takes in revenue [email protected] press secretary to Senate Majority Leader Mike Bishop, R-Rochester. The legislative work group is chaired by Senate Finance Chair Nancy Cassis, R-Novi, and House Tax Policy Committee Chair Steve Bieda, D-Warren. The group is ex- pected to report early this week. Tricia Kinley, director of tax poli- cy and economic development for the Michigan Chamber of Commerce, said it “speaks volumes” that House and Senate leaders agreed to the bi- partisan approach. “That, I think, will help move the process forward. People can feel that they have input, and that at least is a step in the right direc- tion,” Kinley said. She said she hopes the work group will come up with a balanced business-tax approach that does not favor one industry or business size over another. Meanwhile, discussions were scheduled to continue through last weekend on solutions to erasing Michigan’s current-year budget deficit, amid indications an agree- ment could be reached this week. A revenue-estimating conference this Friday will give lawmakers and state officials the latest revenue projections for fiscal 2007 and 2008. Some in Lansing have speculated the current-year budget solution will mix cuts, restructuring and new revenue, such as an increase in Michigan’s income-tax rate from 3.9 AirLiner™ WS100 SMART Board™ 600i Senteo™ interactive SMART Board™ 3000i percent to 4.6 percent, as proposed wireless slate interactive whiteboard response system interactive whiteboard in a bill sponsored by Rep. George Cushingberry, D-Detroit. But Marsden said Bishop is “not At Audio Visual Innovations, we carry the high quality, cutting edge interested in balancing 2007 with tax increases” and remains com- AV equipment you need to enhance communication and improve mitted to achieving the needed sav- ings through cuts. productivity. 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Page 8 CRAIN’S DETROIT BUSINESS May 14, 2007 OPINION O TELL ME, ARE YOU FLUENT Of growth, victories IN CHINESE? — and Kevorkian ome short takes on the ways in which metro Detroit has been winning and losing in local business news: S Winning: Six Detroit companies were among the 100 fastest-growing central-city companies in the United States, more than any other city, according to a report released May 7 by the Initiative for a Competitive Inner City and Inc. maga- zine. The companies are: Commodity Sourcing Group, the Pis- ton Group, Vision IT, National Logistics Management, Detroit Electrical Services and Integrated Media Technologies. And at least some of their success seems to be “because of” instead of “despite” their innercity locations. Darryl Hart, CEO of Commodity Sourcing, grew up in De- troit and said he saw competitive advantages to an innercity location, including proximity to customers and reasonable real estate. (For more on these companies, see Page 21.) Losing: Global media will turn attention to Michigan for all the wrong reasons early next month when Jack Kevorkian is released from prison. According to a report in the Detroit Free Press, CBS plans to air Kevorkian interviews with Mike Wal- LETTERS lace on June 3, and news organizations from as far away as China, Japan and the United Kingdom have been jockeying for picture and interview opportunities. State needs stem-cell research Winning: Detroit sports fans. We don’t know yet if the Pis- tons, Red Wings and Tigers will win championships this year, Editor: Crain’s Detroit Business Not right-to-work but we do know that we’re seeing a lot of impressive perfor- If this state continues to place welcomes letters to the editor. mances. The Pistons’ dismantling of the Chicago Bulls on its head in the sand and ignore Editor: All letters will be considered for companies on the cutting edge of I have a question regarding Tom Thursday was a particularly notable sports highlight last publication, provided they are Kinnear’s quote in the Spring 2007 week. So here’s to Chauncey, Rasheed, Dominik, Pavel, Mag- medical stem-cell research, it will signed and do not defame continue to fall behind (“Legisla- Growing a new economy special re- glio, Placido and the rest of the teams. individuals or organizations. tion aims to lift stem-cell ban,” Letters may be edited for length port in the April 23 issue of Crain’s Losing: The housing industry. Pulte Homes Inc. CEO April 16). and clarity. Detroit Business (“Taking the long Stem-cell research is the future Richard Dugas told shareholders on Thursday that the nation- Write: Editor, Crain’s Detroit view”): and many in this country can and wide housing slump may not have bottomed out and that it Business, 1155 Gratiot Ave., “Michigan auto jobs didn’t go to will benefit from the positive re- Detroit, MI 48207-2997. China or Japan. They went to Ten- may take Michigan longer to recover than the rest of the coun- search that will come from this ex- nessee and Kentucky and Ohio and try. citing field of science. Michigan E-mail: [email protected] Mississippi. They went to right-to- Winning: Development continues to come to downtown De- needs to make an all-out effort to work states.” troit. Financing closed on the $82 million restoration of the save this industry from relocating, and ethical dilemma but I believe taking its staff and a potential the potential benefits outweigh the I agree with his overall position; Pick-Fort Shelby Hotel, due to become a Doubletree Hotel, last windfall with it. The biomedical negative hype. however, it’s difficult to argue his week. That followed on the heels of the previous week’s an- field is a major player in this coun- Stop running cutting-edge com- points because Ohio and Kentucky nouncement of a major riverfront residential development by try and it makes little sense to ig- panies out of the state and encour- are not right-to-work states. nore these players, but Michigan developer/industrialist Dave Bing. The economy continues to age them to stay and grow. If our Jon Rundels at times makes very little sense. lawmakers can’t find a way to Lexington have well-documented struggles, but the success of downtown Michigan should change the open the door for stem-cell re- projects, particularly in residential, is a bright spot. laws now pertaining to stem-cell search, then we need to change our Low taxes won’t fix state research. So many birth defects Winning: Michigan has been recognized by Area Develop- lawmakers. Editor: and injuries could be helped by ment magazine as one of the states that have been most suc- Ron Austin Wake up Michigan! Lansing stem-cell research and ignorance Vice President needs to keep playing partisan pol- cessful in securing major corporate investments in the face of is not the path to follow. We can de- Wedgewood Property Management global competition. bate for years to come the moral Franklin See Letters, Page 9

KEITH CRAIN: There’s no single solution for our state These days, everyone seems to that there is plenty of government when your hundreds of others as well. many solutions that have to be de- be looking for a silver bullet that blame to spread around. single industry is in a And just as so many people are bated, discussed and perhaps im- will solve our state’s problems. The economy of our downward slide. the cause of our problems, don’t plemented, whether we’re talking The problems with our state gov- state has a huge rela- If we added up all the expect a single silver bullet to cure about the repeal or modification of ernment cannot be linked back to a tionship with the viabil- wrong decisions and everything that ails our communi- our term limitations or a part-time single event or a single person. It’s ity of our automobile in- the lack of action on the ty. Legislature or passing a right-to- so easy to try to put all the blame dustry and, sadly, it is part of government, We have to do a thousand things, work bill. These are all small steps on one person, but that defies logic. in the same downward we’d discover a long list some big and some small, in order in a very long and arduous journey. We’ve been in a slow, long spiral spiral it’s been in since of deficiencies from a to try to turn this state around. We have to try them all. Some that has been going on for a few 1973, when the United lot of different people. And we have to start today. will work and become part of our decades, so it’s clear we can’t States had its first oil But have you noticed Everyone knows about the SBT foundation, and others will have to blame it all on our present gover- embargo and gasoline that everyone tries to and the Legislature trying to be rescinded or replaced. nor or on our past governors. The skyrocketed from 25 deflect the blame from scramble to replace the lost mil- One bullet didn’t get us into this nice thing about the financial mess cents a gallon to 60 cents. their administration or them- lions in revenue. But that’s just a mess, and one silver bullet isn’t go- that we are facing in Michigan is You can’t have a viable state selves. It’s their fault and that of part of the solution. There are so ing to get us out. DETROIT BUSINESS MAIN 05-14-07 A 21 CDB 5/11/2007 5:32 PM Page 1

May 14, 2007 CRAIN’S DETROIT BUSINESS Page 21 BRIEFLY Six local companies TELL CRAIN’S ABOUT YOUR among Inner City 100 POWER SELLERS Six Detroit companies were among the 100 fastest-growing cen- Crain’s Detroit Business is seeking tral-city companies in the United top salespeople for its Power Sellers feature. States, more than any other city, according to a report released May This special section, to be published July 9, will spotlight the 3 by the Initiative for a Competitive In- dealers and closers in Southeast ner City and Inc. magazine. Michigan that use creativity and The companies are: moxie to close the sale and exceed Ⅲ Commodity Sourcing Group, their goals. which sets up purchasing systems To nominate someone, go to for hospital, was ranked No. 4, www.crainsdetroit.com and click on with 2005 revenue of $24.6 million “Power Sellers” under the “forms and 84 employees. CEO Darryl and surveys” headline in the left- - Anthony Stafford McDonald Hart, who grew up in Detroit, said hand bar. - DonDirector Tanner of Fund and MattDevelopment Friedman he saw competitive advantages to To request a nomination form by Partners, Tanner Friedman StrategicVanguard Communications Community an inner-city location, including mail, fax or e-mail, call Anita Development Corporation proximity to customers, reason- Duncan at (313) 446-0329. Members, Detroit Regional Chamber able real estate and access to a Nomination forms must be technology-literate workforce. received by June 8. Ⅲ Piston Group, an auto supplier ranked No. 12, ternet access available in all 720 with $185 mil- square miles of Washtenaw Coun- lion in 2005 rev- ty, was given the Midwest Collabo- The Chamber gets enue and 300 ration Award Wednesday night at employees. the annual Midwest Technology Founder Vinnie Leaders conference at the Royal us Park Hotel in Rochester. connections Johnson launched his Wireless Washtenaw is a part- company in 1995 nership that includes the University and has done of Michigan, Eastern Michigan Univer- and our clients answers. Johnson work for GM sity, the Ann Arbor Chamber of Com- and Ford, including recent con- merce, Ann Arbor Spark, the Ann Ar- tracts to build platforms for Ford’s bor Downtown Development Authority F150 and Ford 500 trucks. and a handful of companies in the Join today with no application fee. Ⅲ Vision IT, No. 21, with 2005 rev- private sector. Call us at (313) 596-0391 or visit www.detroitchamber.com to learn how to put the Chamber to work for you. enue of $9.1 million and 200 em- Doug Rothwell, president of De- ployees. The CEO is founder David troit Renaissance; Cherri Musser, Segura, who formerly worked for group vice president and chief in- Ford and in the information-tech- formation officer of General Motors nology industry. Acceptance Corp.’s worldwide fi- Ⅲ National Lo- nancial services; and Rodney gistics Manage- O’Neal, CEO and president and ment, No. 22, Delphi Corp., were named Corpo- with 2005 rev- rate Commitment to Michigan enue of $184 mil- Award winners. lion and 193 em- — Tom Henderson ployees. CEO Scott Taylor started the Region cited in health study freight logistics Metro Detroit has been cited as Taylor company in one of 14 communities in a report 1991. from the Robert Wood Johnson Foun- Ⅲ Detroit Electrical Services, No. dation and the Center for Health Im- 61, with 2005 revenue of $15 million provement that examines how com- and 60 employees. The company is munities can drive and sustain owned by Shaw Electric and Rhodes high-quality health care. & Associates and was launched in Among seven attributes 1999 to create a minority-owned scanned in each community, electrical company. Michael Gra- Southeast Michigan received high ham is CEO. marks in health care community Ⅲ Integrated Media Technologies, leaders, performance measure- No. 76, with $3.1 million in 2005 ment and public reporting. The revenue and 31 employees. CEO Greater Detroit Area Health Council’s Joe Reyes, the son of Mexican im- regional health care initiative, migrants, started the company in Save Lives Save Dollars, and other 1997 with a partner and a credit aligned community efforts laid the card. The company installs securi- foundation for the recognition. ty cameras, access-control devices, The report notes considered sev- and voice and data networking. It en attributes among the 14 commu- recently started a new division to nities. The report underscores the supply equipment and materials to need to account for local and re- various markets. gional variations in any national The organization defines inner effort to improve health care quali- cities as core urban areas that ty and will help Southeast Michi- have higher unemployment and gan draw its own road map for im- poverty rates and lower median in- provement. come levels than the surrounding The other areas were Boston; Metropolitan Statistical Area. Cincinnati; Indianapolis; Madi- son, Wis.; Memphis, Tenn.; Okla- Wireless Washtenaw wins homa City; Phoenix, Ariz.; Port- land, Ore.; Rhode Island; tech collaboration award Rochester, N.Y.; Savannah, Ga.; Wireless Washtenaw, a collabora- and Seattle. tive effort to make high-speed In- — Andrew Dietderich DETROIT BUSINESS MAIN 05-14-07 A 22 CDB 5/11/2007 5:33 PM Page 1

Page 22 CRAIN’S DETROIT BUSINESS May 14, 2007

MEETINGS & CONVENTIONS Local housing slump has SAWMILL CREEK RESORT & CONFERENCE CENTER

• NEW! 16,000 s.f. Ballroom • Golf construction jobs declining 35,000 s.f. Total Function Space • Lakefront Marina

BY AMY LANE “We’re not in any way diminish- CAPITOL CORRESPONDENT OVERALL UNEMPLOYMENT ing some of the pain and suffering 2007 2006 that our industry is going through LANSING — For a long time, de- County 1Q 4Q 1Q right now,” he said. “But we have clines in manufacturing employ- seen historically, with every severe Livingston 5.7% 5.2% 5.8% ment have been the Southeast downturn, that there is a bouncing Michigan jobs story. Macomb 7.2% 7.2% 7.1% back and return of business.” But now, in both Michigan and Oakland 5.8% 5.6% 6.0% He believes there’s a growing, the Detroit area, construction-job pent-up demand for housing, and Washtenaw 4.7% 4.3% 4.6% losses are outpacing manufactur- also said that even as manufactur- ing-job declines as the effects of a Wayne 8.0% 8.3% 8.4% ers downsize they are transferring slumping residential housing mar- State 7.3% 6.6% 7.3% employees from other states to fill ket spread and a manufacturing positions, helping with residential downturn continues. Source: Michigan Department of Labor and Economic Growth housing and rentals. The latest data from the Michi- Komer, who is first vice presi- sawmillcreek.com gan Department of Labor and Econom- cent to 40 percent, in terms of total dent of the Building Industries Associ- ic Growth show that from first-quar- hours worked by construction ation of Southeast Michigan, said one Sandusky/Huron, OH 44839 1-800-729-6455 ter 2006 to first-quarter 2007, workers. outcome of the residential down- construction employment for the But, he said, there are bright turn is that some builders have six-county Detroit Metropolitan spots, like building in the health switched to remodeling. Statistical Area dropped by 8.4 per- care industry and the new Detroit Doug Manix, president of de- cent or 6,000 people. casinos. sign/build construction firm “This had been a sector that just Darshan Grewal, vice president Campbell/Manix Inc. in Southfield, plugged along, was fairly flat, was of Singh Development L.L.C. in West isn’t hiring but isn’t anticipating stable,” said Jim Rhein, labor mar- Bloomfield Township, said that layoffs, either. “The name of the ket analyst at the department. while his company has seen a game in our business right now is In the same time period, manu- slowdown in its home and apart- to just run lean, and kind of spread facturing jobs dropped by 4.4 per- ment division and has reduced your resources around as best you cent or 12,000 people in the Detroit construction and other staff in that can without hiring.” MSA, which encompasses Wayne, area, new senior housing develop- Rhein said the Detroit area has Oakland, Macomb, Lapeer, Liv- ments underway has the company borne the brunt of overall ingston and St. Clair counties. adding employees, resulting in an statewide job declines. While the Michael Smith, executive vice overall net gain of about 75 jobs. area represents 46 percent of all president in the Redford Township “We have a temporary reduc- payroll employment in the state, it office of the Associated General Con- tion on new construction jobs, but showed 78 percent of statewide job tractors of Michigan, said that the in the meantime we are adding losses in the period between first- association has seen a steady de- jobs” elsewhere, Grewal said. quarter 2006 and first-quarter 2007, cline in construction employment Richard Komer, president of he said. over the last several years and con- Wineman & Komer Building Co. in Amy Lane: (517) 371-5355, alane@ struction overall is down 20 per- Southfield, also is optimistic. crain.com FMF Capital closes its doors after settlement

BY TOM HENDERSON tus for its IPO, it had net income of $8.7 million in CRAIN’S DETROIT BUSINESS 2002, $16.3 million in 2003 and $30 million in 2004. Rev- enue was $33.7 million, $69.1 million and $102.8 mil- Southfield-based FMF Capital L.L.C., once a high flier lion, respectively. in the world of residential subprime mortgages with Before being renamed FMF Capital L.L.C. following aspirations of becoming a national player, has shut its IPO, the company had written loans under the en- its doors. tities FranklinDirect and Franklin Mortgage Funding Inc. As of last Wednesday, the phones were still work- It is unrelated to Southfield-based Franklin Bank. ing with a taped message instructing callers how to In November 2005, the company began its implo- access the staff directory, but the company’s two of- sion when it announced that because of turmoil in the fices in the Maccabees Center at 25800 Northwestern subprime market, it was suspending the monthly div- THINKING ABOUT BUILDING SECURITY? Highway were without furniture or people, and the idends that made the stock attractive to Canadian in- doors were locked. vestors. Within days, it was trading at 53 cents. CEO Robert Pilcowitz and CFO Howard Morof de- In December, class-action lawsuits were filed in Oak- clined comment last week but confirmed through land County, Quebec and Ontario, alleging fraud and Mark Winter, partner in Bingham Farms-based Identity seeking up to $1.1 billion in damages. Marketing & Public Relations, which used to represent Total FMF officials said the claims were without merit. Security 1-800-380-3080 the firm, that “they are in the process of winding down In March, FMF issued a press release in Canada say- Solutions www.iamsafe.net their business and will do so by month’s end.” ing that it would no longer originate or fund new mort- FMF went public at $10 a share on the Toronto Stock gages. Later that month, a Quebec court approved an Exchange in March 2005, raising the equivalent of $160 out-of-court settlement for $28 million Canadian. million in U.S. currency. Company press releases tout- In April, an Ontario court concurred in the settle- THE LEADER IN ed it as the first U.S. financial-services company to go ment, part of the terms of which dropped the Oakland • Access Control public in Canada. At the time, it had a network of 5,000 County action. The Toronto Stock Exchange also brokers, operated in 38 states and had its own offices in delisted the company. • Cameras Scottsdale, Ariz.; Nashville; Virginia Beach, Va.; and Jonathane Ricci — a partner in the Toronto-based • Intrusion Systems Overland Park, Kan. law firm Juroviesky & Ricci L.L.P., one of the firms that COO Edan King said then that the money raised filed the class-action suit — said Thursday that the set- would finance a national expansion, including offices tlement money has been deposited in a trust account. in Florida and California. Today, a Web site, www.classactionsettlement/fmf, The company — which traced its root to 1992 and is scheduled to go up where purchasers of FMF stock the funding of Michigan Fidelity Acceptance Corp. by Pil- can join the settlement class. Ricci said a payout will de- cowitz and King — had about 400 employees in 2005, pend on how many join, and at what price they pur- when it was one of 10 Southeast Michigan companies chased the stock. He said the settlement will range COMMERCIAL • RESIDENTIAL to make Inc. magazine’s list of 500 fastest-growing U.S. roughly between 8-15 cents a share. The lawyers will get companies, at No. 334. a bit more than $6.3 million of the $28 million, he said. 28715 Greenfield • Southfield, MI 48076 It recorded $2 billion in loans in 2004 and was pro- Tom Henderson: (313) 446-0337, thenderson@crain. jecting $2.9 billion in 2005. According to the prospec- com DETROIT BUSINESS MAIN 05-14-07 A 23 CDB 5/11/2007 6:09 PM Page 1

May 14, 2007 CRAIN’S DETROIT BUSINESS Page 23 Joy ride ends for ASC Stiff competition, loss of GM pact, R&D plan seen as factors

BY ROBERT SHEREFKIN just two years of production that undermined ASC. CRAIN NEWS SERVICE The SSR accounted for more than 50 percent of ARE YOU BIZDOM U? ASC’s annual revenue, which Automotive News esti- Bizdom U is looking for future entrepreneurs. Are you ready to put When entrepreneur Heinz Prechter’s ASC Inc. faced mated to be $500 million in 2005. your DREAM and your DRIVE to work this September? Bizdom U financial difficulty, he put his personal fortune at risk According to Wilbur’s court statement, ASC gener- is a full-time, year round, two-year boot camp. Bizdom U will pay to keep it going. ated only $106.7 million in revenue in 2006. ASC’s for 100% of your tuition, room, board, training materials and provide: But when recent troubles plagued ASC, the private- workforce went from 1,250 employees in January 2005 equity owner that bought the company after The personal involvement and vision of Dan Gilbert, to 252 people this year, Wilbur’s statement said. who is the founder of Rock Financial, Quicken Prechter’s death in 2001 put ASC into Chapter 11 reor- GM also ended contracts for three other specialty Loans and the majority owner of the Cleveland ganization. vehicles and postponed or canceled additional early- Cavaliers. The Chapter 11 filing on May 2 was part of a deal an- stage projects. nounced May 4 to sell some of the company’s assets. Practical, real world training, culminating with the GM spokeswoman Deborah Silverman said that development of your business plan for a Detroit- The surge of private equity in the auto industry when the automaker canceled the SSR, “we came to based business. brings a disciplined dollars-and-cents operational an accommodation that was mutually satisfactory for style. It brings new capital. But there is little patience both parties.” An expected investment into your business of for investments that fail to earn profits because of set- ASC says it invested nearly $250 million in the SSR between $25,000 and $500,000, over time based on milestones and performance. backs or dips in fortunes. program. But ASC’s markets and technology were eroding ASC was profitable when Questor acquired it. before the manufacturer of specialty vehicles, sun- A piece of ownership in the business and an Prechter pioneered the North American original- opportunity to earn a greater share of ownership in roofs and convertible tops was acquired in 2002 by equipment and aftermarket sunroof businesses. He the business over time based on milestones and Southfield-based Questor Management Co. L.L.C., the brought back the convertible top for the Corvette and performance. buyout firm co-founded by turnaround star Jay Alix. dominated the sector by supplying “top stacks” for Once-celebrated ASC was beset by cutthroat compe- Dynamic instructors, high tech tools and a training the Mustang and the Chrysler Sebring and others. facility in the heart of Detroit’s cultural center. tition and the unexpected cancellation in 2005 of a Prechter wowed the automotive press in 1995 with Residence and all meals at a new residential tower. huge General Motors Corp. contract. And, according to his conversion of the Mitsubishi 3000GT into the 3000 a former insider, ASC failed to make enough invest- GT Spyder, North America’s first retractable hardtop Bizdom U is a DEMANDING program! ments in engineering and operational support. convertible since the 1959 Ford Skyliner. The owners and operators of the Southgate compa- But the empire Prechter founded in 1965 withered If you are at least 18 years old with a High School Diploma or ny are trying to assemble a new specialty-vehicles from intense competition. By the time of Prechter’s GED, can participate in our residential boot camp, and are company with its prospective buy- death, several global companies were entrenched in tough enough to experience our extensive admission process, please call or email us to request a reservation at one of our er, according to ASC CEO Paul ASC’s various segments. They brought new technolo- Wilbur. informational meetings. Information is also available at gy and better engineering. For example: The buyer is Hancock Park Associ- www.bizdom.com. Ⅲ European competitors Inalfa Roof Systems Inc. and ates, a Los Angeles private-equity Webasto Roof Systems Inc. now dominate the sunroof firm. It owns Saleen, the Ford spe- market. cialty tuner for the Saleen S7 and Ⅲ 313-833-7800 the Ford GT, according to an e-mail Much of Prechter’s soft-top convertible business message Wilbur sent to Crain’s sis- was lost to Dura Convertible Systems — a unit of Collins [email protected] ter publication Automotive News & Aikman Corp., now in Chapter 11 — and Karmann USA Inc. Wilbur last week. Hancock Park, as a condition of Ⅲ In the retractable hardtop business, Karmann sale, asked ASC to file Chapter 11 to avoid future and Magna Car Top Systems, formerly CTS Car Top Sys- claims by creditors against Hancock Park, according tems NA Inc., now dominate. to Wilbur. The aim, he stated, “is to create a powerful “Either from inability or indecision,” said a former new specialty vehicle company.” high-level insider, “the fact is that the company did ASC was hurt by lower Big Three volumes. But not invest in engineering and operational support to thedowntowncollection Wilbur said in a U.S. Bankruptcy Court affidavit that it produce hard- and soft-top convertible systems and Legendary buildings in the center of it all! was GM’s “unexpected and premature” decision in sunroofs.” late 2005 to discontinue the SSR roadster pickup after From Automotive News Welcomes and Congratulates Our New and Expanding Tenants first national building -new tenants- Redot, LLC Postage: Enduring Change Massage Therapy Catalogs take hit from hike Enoteca Campo Marzio Mack Avenue Detroit Jazz Festival ■ From Page 3 -expansions- Robert Wolfe, founder of Moosejaw Mountaineering panies also expect to be affected by the rate increase. Somat Engineering, Inc. and Backcountry Travel Inc., said he expects the new Keller said. Data Driven Marketing saw a “significant Detroit Contracting, Inc. postage rates will cut into the retailer’s profits. But increase” in business recently as clients rushed to Onyx Financial Group the company is confident that sales from its catalog, mail before the postage increase. which mails in August, will recoup some of the costs. “It’s been one of the best two weeks we’ve had in penobscot building “The catalog will still be an amazing piece for us, quite a while,” Keller said. “Everyone’s trying to beat -new tenants- and even though the postage is going up, it won’t stop the rate.” E.D.G.E. International us,” said Wolfe, who said the company mails up to 1 Riverpointe Realty One client saved $1,500 in postage costs by mailing True Wealth Funding, LLC million catalogs a year. 60,000 direct-mail pieces last week instead of waiting Both Zingerman’s and Moosejaw say they periodi- until Monday, Keller said. He said his company will -expansions- cally review their catalog mailing lists, but expect to pass on any additional postage to its customers rather Jaques Admiralty Law mail about the same number of catalogs this year than absorbing the cost. compared to last year. Steve Altounian, database administrator for Ran- cadillac tower The postage increases were approved by the inde- dolph Miller Associates in Brighton, said his company -new tenants- pendent Postal Regulatory Commission in February. will absorb some postage costs but will need to pass Pathway Solutions The postal service filed for the rate changes last May along some of the increases to its clients. because it said it would stand to lose $5.9 billion in -expansions- For instance, the company has a “budget mail” pro- 2008 without the additional revenue. Diallo Wilder and Polk, PLLC gram that allowed customers to mail 205 postcards for While previous postal rate changes were based on EBI-Detroit, Inc. Tucker & Tobin the weight of mail being sent, most of the new increas- $124. That cost will likely increase by 2 cents a post- card, Altounian said. es are based on the size and shape of mail, said Jim -And Extends Appreciation to Brokers- Mruk, the postal service’s manager of public affairs Altounian expects the cost increase will hurt the and communications for the Great Lakes area. company’s business by about 5 percent. But the com- Nina Aloisi and Rachele Downs of CB Richard Ellis For instance, a 1-ounce first-class letter will cost 41 pany can’t afford to take on much more in additional Damon Jordan of Grubb & Ellis cents to send in a No. 10-sized envelope, versus 80 costs, he said. cents in a flat, letter-sized envelope. “It’s hard to keep absorbing it every year when it First National Building • 660 Woodward Ave. “The easier the mail piece is for us to handle, the keeps going up.” Suite 1150 • Detroit, MI 48226 less it’s going to cost,” Mruk said. Sheena Harrison: (313) 446-0325, sharrison@crain. 313-962-0056 • fax 313.962.5596 • thedowntowncollection.com Besides companies with catalogs, direct-mail com- com DETROIT BUSINESS MAIN 05-14-07 A 24 CDB 5/11/2007 6:10 PM Page 1

Page 24 CRAIN’S DETROIT BUSINESS May 14, 2007 Health care: Annual cost increases remain at 6 percent ■ From Page 3 keep health care costs down is one two years. for the American Society of Employ- er footing 64 percent of the bill. up from 24 percent in 2006) now of- area growing more popular with The company switched its carri- ers-Southeast Region Headquarters The out-of-pocket employee fer benefits to part-time employ- local companies, the survey found. er for out-of-state employees back in Southfield. The ASE does a bien- costs were calculated based on es- ees. Such strategies include smoking- to Blue Cross Blue Shield, increased nial health benefits survey of its timates provided by an outside ac- There’s been an increase in cessation and weight-loss pro- deductibles, moved to a three-tier own and has seen similar findings. tuary, McLaughlan said. companies offering “consumer- grams, health-club discounts, and prescription drug plan and boost- “I think cost-sharing was the Other highlights include: driven health plans” such as health screenings and appraisals. ed co-pays, all in an effort to keep low-hanging fruit,” he said. “Short Companies offering free health savings accounts, from 8 Detroit-based chemical manu- costs down. of some government solution to health care benefits have steadily percent to 11 percent. facturer and distributor PVS Chemi- Bayer said PVS’s 400 employees ease the health care burden on declined over the past three years, In 2006, there were 456 survey re- cals Inc. has used wellness pro- understand the company’s actions. U.S. employers, companies will from 25 percent to 21 percent for spondents, but those included gov- grams to cut costs for the past four “They don’t necessarily like it. have to use a multifaceted ap- single coverage and 21 percent to ernments and public school dis- years, said Grace Bayer, PVS’ di- They understand the costs. We proach to controlling costs.” 16 percent for family coverage. tricts. Those were separated from rector of human resources. convey the cost the company has New for this year’s survey was a Domestic-partner coverage lo- this year’s results and will be re- The company offers programs to to incur,” she said. “If we can keep calculation of what McGraw Went- cally increased from 9 percent to leased on their own later this year, help workers quit smoking, pays some of their contributions down worth calls the “total cost” of 14 percent over the past two years, McLaughlan said. for half the cost of Weight Watchers, by some of the things we offer, health care. behind the national rate of 29 per- The results from past years were subsidizes some of the cost of YMCA they’re happy, too.” It’s a formula based on the tradi- cent. recalculated without governments membership and has an on-site Bayer estimated PVS saw its tional employee payroll deduction More employers are boosting and public school districts so that gym. It also offers incentives for benefit costs rise by about 6 per- and employer cost, but with an es- specialist co-pays compared with this year’s numbers could be prop- employees to take part in wellness cent over the past two years. timate of employee out-of-pocket those for primary-care doctors (12 erly compared with those from programs, Bayer said. “Had we not have made some of contributions mixed in. percent from 8 percent). previous years. “It gets them to take better care these changes, it would have been The results show that the aver- Sixty-nine percent of respon- Sixty-one percent of the survey of themselves,” she said. Employ- significantly more than that,” she age annual premium for a median dents said they expect to share respondents had fewer than 500 ees must take annual physicals, said, noting it is difficult to quanti- benefit level individual PPO plan health care cost increases with em- employees, and 66 percent were lo- get a health analysis from a doctor fy savings because medical priva- was $4,512, but the addition of the ployees or absorb up to 100 percent cated in Wayne and Oakland coun- and fill out a health-risk assess- cy laws don’t allow access to all employee out-of-pocket costs of the increase. ties. Most (39 percent) were manu- ment online. claims. boosts that figure to $5,736. That Increasing deductibles and co- facturing companies, and 28 PVS is one of McGraw Went- The rise in wellness programs is breaks down to the employee pay- pays and upping employee contribu- percent identified themselves as worth’s “TrendBenders,” compa- part of a trend to find different ing 36 percent of costs (15 percent tions remain the most popular cost- auto suppliers. nies with the lowest rate of health ways to control costs, said Kevin from payroll deductions and 21 per- control strategies for companies. Bill Shea: (313) 446-1626, care cost increases over the past Marrs, director of survey services cent out of pocket) and the employ- More employers (29 percent, [email protected] NAIC: CEO DMC: Move would lead to $25M loss, could close hospital

BY ANDREW DIETDERICH not moving forward with the promised im- to retire CRAIN’S DETROIT BUSINESS provements to the hospital and campus. Karmanos’ subsequent Karmanos’ subsequent decision to leave ■ From Page 3 The Detroit Medical Center could be forced to the DMC campus “will wreak havoc on the close one of its hospitals and would lose about decision to leave the DMC DMC and its patients,” according to the law- Sweeney said. $25 million annually if the Barbara Ann Kar- suit, which pegged the loss at $25 million a The organization has also applied manos Cancer Institute moves ahead with campus “will wreak havoc year for several years. term and age limits to all board mem- plans to buy St. John Riverview, a lawsuit filed bers and put in place some anti-nepo- “It’s very important to us to protect our in- May 4 contends. on the DMC and its tism controls such as limits on rela- terests and they have a very strong contrac- A hearing is scheduled for today on a re- tives being compensated and on hiring patients,” according to the tual obligation to stay on the DMC campus,” quest from the DMC for a temporary restrain- relatives, Sweeney said at that time. said DMC COO Benjamin Carter. ing order to prevent the sale from moving for- “The theory behind the settlement lawsuit. Carter said DMC considers the cancer in- ward. is that some of the entrenched insid- The suit, filed by the DMC and Michigan AF- stitute to be part of its coordinated on campus ers are gone, and there’s an opportu- operated by the DMC. care and that the cancer institute shouldn’t nity to add a lot of new people,” SCME Council 25 in Wayne County Circuit Court, In 2004, Karmanos approached the DMC claims Karmanos will, in effect, “abscond” be separated from that. Sweeney said. about a proposal to purchase the cancer oper- “The Karmanos Cancer Institute is disap- Holthaus was elected an NAIC with the DMC’s cancer operations, if the ations, including physical facilities and transaction is allowed to take effect. It asks pointed with the decision of The Detroit Med- trustee in 1987 and named president equipment. The DMC agreed to do so based the court to stop the transaction or allow it to ical Center to initiate litigation while Kar- and CEO in 2002. He succeeded Ken- on Karmanos’ promise to build and operate a void a previous contract in which the DMC manos has continued to negotiate in good neth Janke Sr., then 72, as chairman first-class cancer hospital facility on the turned over its cancer operations to Kar- faith with the DMC,” the organization said in last fall when Janke retired after four DMC’s main campus. years at the helm and 46 years with manos. a written statement. The DMC agreed to a price $19.3 million, the nonprofit. AFSCME Council 25 represents workers at Karmanos said it has honored and will con- $9.9 million of which was to be paid at closing Thomas O’Hara Sr., one of the orig- St. John Riverview who could lose their jobs tinue to honor all of its commitments to the inal trust founders and chairman in a closure of the hospital. and the balance to be financed by the DMC DMC and that there is nothing that prevents emeritus of NAIC, also stepped down, The lawsuit gives the following history: under a “lease to own” arrangement. The the cancer institute from moving all or part and trustee Kenneth Lightcap, who In 1995, based on an affiliation agreement, DMC contends that price was about 25 per- of its operations to Riverview. The suit will was accused by members of using in- the DMC began operating the Harper University cent of market value. be vigorously defended, the organization said timidation tactics to keep opponents Hospital cancer program under the name The deal closed in late 2005, and the lawsuit in a written statement. quiet, resigned in February after “Karmanos Cancer Hospital.” However, all contends Karmanos breached the agreement Andrew Dietderich: (313) 446-0315, coming under fire for strong language cancer facilities continued to be owned and by not making agreed-upon payments and [email protected] against NAIC members in a Wall Street Journal article. According to NAIC’s Web site, it had 131,556 investment club members as of February. That’s down from 220,074 members it reported in the Hospitals: Bon Secours is prize in competition summer of 2005 and about 350,000 ■ members when Holthaus took over in From Page 1 2002, said Michael Gross, a would stay open for another year and 123-bed Cottage Hospital in Dwight Angell, director of ex- its mind. spokesman with Anne Klein & Associ- while it plans for an urgent care Grosse Pointe Farms. Bidders ternal communications at Henry Oakwood President Gerald ates Inc., which represents NAIC. center nearby. are: St. John, the DMC, Royal Ford Health System, said Bon Fitzgerald said the decision came Its investment clubs have also Peggy Moseley, vice president Oak-based William Beaumont Hos- Secours’ local public-relations when he learned Henry Ford dropped to about 13,127 today, down for marketing and communica- pitals and Detroit-based Henry representative Cande Tschetter Health System is playing a large Ford Health System from 19,640 in the summer of 2005. tions for Bon Secours Health Sys- . Henry Ford is handling media calls for Henry role in the decision. NAIC offers networking and practi- tem, said the board of directors is has owned 30 percent of the Bon Ford. Tschetter would only say “If the final decision is going to cal investing experience for members “finishing up the process” of Secours Cottage joint venture and regional chapters that plan, orga- making a decision but didn’t give since 1998. “things are happening.” be made by a competing health nize and present investment semi- a timeline. Ilene Wolff, media-relations A call placed to DMC Friday system we felt that wasn’t a posi- nars, workshops and investor fairs Four bidders are in the run- specialist at Beaumont, said was not returned. tion we wanted to be in,” Fitzger- throughout the year. ning for the health system, which Beaumont remains interested in Dearborn-based Oakwood ald said. Sherri Begin: (313) 446-1694, consists of the 289-bed Bon Sec- buying Bon Secours. She didn’t Healthcare System originally was Andrew Dietderich: (313) 446- [email protected] ours Hospital in Grosse Pointe want to say anything else. a bidder, but since has changed 0315, [email protected] DETROIT BUSINESS MAIN 05-14-07 A 25 CDB 5/11/2007 4:37 PM Page 1

May 14, 2007 CRAIN’S DETROIT BUSINESS Page 25 Electricity: Choice fuels power battle for utilities www.crainsdetroit.com ■ From Page 1 EDITOR-IN-CHIEF Keith E. Crain PUBLISHER Mary Kramer, (313) 446-0399 or customers, hasn’t delivered cheap- second-highest industrial prices. changes in Michigan’s rate struc- [email protected] ASSOCIATE PUBLISHER Christopher Crain, (313) er rates and is a failed experiment. But Peter Lark, chairman of the ture that will end a system in 446-1645 or [email protected] And executives at DTE Energy Co. If you want to Michigan Public Service Commission, which commercial and industrial EXECUTIVE EDITOR Cindy Goodaker, (313) 446- and CMS Energy Corp. say Michi- “ said those figures don’t reflect rate customers pay higher rates to sub- 0460 or [email protected] MANAGING EDITOR Andy Chapelle, (313) 446- gan’s partially competitive, partial- break competition increases pending in states like sidize residential customers. 0402 or [email protected] ly regulated system that allows util- Ohio, nor do they reflect dispari- “If you want to break competi- WEB GENERAL MANAGER Michael Lee, (313) down to its most 446-0416 or [email protected] ity customers to move to alternate ties like the type of fuel used to tion down to its most basic level … ASSISTANT MANAGING EDITOR/FOCUS Jennette suppliers must change, if they are produce power. Indiana, for exam- let us have rates that reflect the Smith, (313) 446-1622 or [email protected] basic level ... let us BUSINESS LIVES EDITOR Shawn Selby, (313) to build power plants that they and ple, generates 97 percent of its elec- cost of service, for all customers,” 446-1654 or [email protected] some others say Michigan needs. have rates that reflect tricity from readily available coal Holyfield said. GRAPHICS EDITOR Nancy Clark, (313) 446-1608 “The seesaw nature of this hy- while Michigan generates 57 per- In 2006, for the second year in a or [email protected] COPY EDITOR Vic Doucette, (313) 446-0410 brid leaves would-be investors the cost of service, for cent of its electricity from import- row, the number of Michigan elec- or [email protected] with no assurance that customers ed coal, with nuclear power and tricity customers served by alter- DATA EDITOR Anne Marks, (313) 446-0418 or [email protected] will stay long enough in either of all customers. natural gas fueling most of the rest nate suppliers declined. A report WEB EDITOR Dan Eizans, (313) 446-0473 or the two choices to invest a billion ” of its electricity generation. issued in February by the PSC [email protected] WEB DESIGNER/PRODUCER Ai-Ting Huang, or more dollars in a baseload pow- Jeff Holyfield, Lark said that among the na- found that the number of cus- (313) 446-0403, [email protected] er plant,” DTE Chairman and CEO CMS Energy Corp. tion’s 10 largest states, Michigan tomers that in 2006 participated in EDITORIAL SUPPORT Anita Duncan, (313) Anthony Earley Jr. said while tes- has the third-lowest residential electric choice dropped about 51 446-0329; Joanne Scharich, (313) 446-0419 NEWSROOM (313) 446-0329, FAX (313) 446- tifying in April to the House Ener- hanging in the balance are elec- and industrial rates, after Georgia percent from 2005. 1687 TIP LINE (313) 446-6766 gy & Technology Committee. and Ohio. Michigan has the fourth- The PSC said declines in electric tricity prices paid by businesses REPORTERS This week, Energy & Technolo- like Livonia injection molder Poly lowest commercial rates, after choice were due to several factors, Brent Snavely, senior reporter: Covers auto gy Committee chair Frank Ac- Flex Products Inc., which makes Georgia, Ohio and Illinois. including higher wholesale elec- suppliers, steel and restaurants. (313) 446-0405 cavitti, D-Eastpointe, plans to cir- packaging and other material-han- Looking at “other states that are tric prices and increases in choice or [email protected]. Robert Ankeny: Covers the city of Detroit, Wayne culate a bill that would eliminate dling products. similar to ours … the 10 largest customers’ delivery rates. County government, and law. (313) 446-0404 or choice and return to a fully regu- Poly Flex was one of thousands states … we fared very well,” Lark The choice system remains fluid [email protected]. Sherri Begin: Covers nonprofits and education. lated system. Accavitti, who has of customers to switch from De- said. as wholesale energy prices fluctu- (313) 446-1694 or [email protected] been holding hearings on the is- troit Edison to an alternate suppli- Dave Waymire, spokesman for ate. And in January, Edison’s and Andrew Dietderich: Covers health care, transportation, international business and sue, said utilities need customer er, shaving about 5 percent off the Customer Choice Coalition, a Consumers’ power-supply rates biotech. (313) 446-0315 or certainty to build power plants. its approximately $10,000-a-month group encompassing large and were adjusted to more accurately re- [email protected]. Sheena Harrison: Covers small business, retail Few utility business customers, electricity bill. But Poly Flex saw small business groups, consumer flect their costs, replacing 2006 tem- and nonautomotive manufacturing. (313) 446- and no residential customers, are savings erode after state regulato- interests and alternative-electrici- porary measures that brought utili- 0325 or [email protected]. Tom Henderson: Covers banking, finance and participating in choice, he said. ry changes increased distribution ty suppliers, said Michigan’s elec- ty power-supply rates lower than technology. (313) 446-0337 or A report issued in February by rates and made alternate supply tricity rates are still too high. But, what some suppliers could offer. [email protected]. Bill Shea: Covers media, advertising and the Michigan Public Service Commis- less competitive, and the company he said, electric choice has helped Terry Harvill, vice president of marketing, entertainment, the business of sports, sion found that in 2006 about 6 per- is now back with Edison. narrow the gap between Michigan regulatory and government affairs and Livingston and Washtenaw counties. (313) 446-1626 or [email protected] cent of electricity sales in the com- “I’m looking to find the best-cost and its neighbors, and “we’d like for alternate electricity supplier LANSING BUREAU bined territories of Detroit Edison energy that I can get,” CFO Russ to see that gap continue to close.” Constellation NewEnergy, said that Amy Lane: Covers business issues at the Capitol, and Consumers Energy were to Campbell said. “If Detroit Edison Jeff Holyfield, CMS Energy’s di- “as this program goes on, as telecommunications and utilities. (517) 371- 5355, FAX (517) 371-2492, [email protected]. or commercial and industrial cus- can give me a better cost, that’s rector of news and information, wholesale prices abate to a certain 115 W. Allegan, Suite 220, Lansing 48933. tomers who chose alternate ven- fine. If the legislation is saying I said Michigan’s existing regulato- extent, as you get utilities’ rates ADVERTISING dors, down from 12 percent in 2005. ry structure, in which the PSC sets could get a better cost from an alter- aligned with their costs … you will ADVERTISING DIRECTOR Marla Downs, (313) Competing with Accavitti’s ap- native energy supplier, that’s fine.” utility rates, drives utilities to be start to see things stabilize.” 446-6032 or [email protected] proach are new bills that would Michigan’s retail electricity prudent in their costs to “a far He said the decline in customer- SALES INQUIRIES: (313) 446-6052; FAX (313) continue Michigan’s electric prices remain among the highest greater extent than the effects of choice participation is no reason to 393-0997 NEW BUSINESS DEVELOPMENT MANAGER Cathy choice law. Republican-sponsored of its Midwest neighbors, accord- competition.” infer the program isn’t a success. Ross, (313) 446-0307, [email protected] Senate Bills 426-428 and House Bill ing to data from the U.S. Depart- And, he said, the fact that all but “I think the fact that customers ADVERTISING SALES Jeff Anderson, Terri Engstrom, Matthew J. Langan, Tamara Rokowski, 4630 would in part amend Michi- ment of Energy’s Energy Information about 600 of Consumers Energy’s have essentially exercised choice Dale Smolinski gan law to encourage more resi- Administration. While Michigan 1.8 million electricity customers and gone back to the utilities is WESTERN ACCOUNTS Ellen Mazen (Los Angeles) dential participation, set up a ranks in the middle compared have remained with the utility, is probably more indicative of the (323) 370-2477 CLASSIFIED MANAGER Melissa McKay, (313) process for bidding on new power with residential prices in Illinois, evidence that “we’re providing cus- program working rather than not 446-1692 plants and provide credits to Indiana, Ohio and Wisconsin, tomers with competitive rates.” working,” Harvill said. CLASSIFIED ACCOUNT EXECUTIVE Christina Jaranowski, (313) 446-1655 choice customers. Michigan has the highest commer- Going forward, both Consumers Amy Lane: (517) 371-5355, alane@ MARKETING DIRECTOR Michelle Minor As Capitol discussions ensue, cial prices of the five states and the and Detroit Edison are seeking crain.com EVENTS MANAGER Nicole Wiedling MARKETING ASSISTANT Jennifer Dunn MARKETING ARTIST Sylvia Kolaski SALES SUPPORT Suzanne Janik, Andrea Beckham, YahNica Crawford CIRCULATION Candice Yopp, Manager. PRODUCTION MANAGER Wendy Kobylarz SenSound: Spin-off gears up to commercialize tech PRODUCTION SUPERVISOR Larry Williams, (313) 446-0301 ■ From Page 1 SUBSCRIPTIONS (313) 446-0450, (888) 909-9111 TO FIND A DATE A STORY WAS PUBLISHED: other customer hopes to soon be- currently aren’t able to find ... or potential in auto manufacturing,” dards for reducing noise in off- (313) 446-0367 or e-mail the Crain Information gin selling SenSound systems to will find them quicker,” said said Bennett. “It has tremendous road machines that were intro- Center at [email protected]. automakers around the world. Schultz. “It will give us a capabili- applications and is very innova- duced in Europe last year should CRAIN’S DETROIT BUSINESS IS PUBLISHED BY CRAIN COMMUNICATIONS INC. Named to the Michigan 50 Com- ty our competitors don’t have and tive technology. They are on the provide sales opportunities. CHAIRMAN Keith E. Crain panies to Watch list in 2006 by the will increase our market share.” right track and making strong “When you are so small, rev- PRESIDENT Rance Crain Edward Lowe Foundation, until now Ian Bennett is program manager progress. There’s no doubt there’s enue projections are pie in the sky. SECRETARY Merrilee Crain SenSound has been headquartered for the Virginia-based National Sci- a big market for this.” The benefit of not having taken TREASURER Mary Kay Crain Executive Vice President/Operations in the Grosse Pointe Farms home ence Foundation. The NSF awarded In April, SenSound, which has 11 venture-capital money is we aren’t William A. Morrow of President and CEO Sergio Maz- SenSound a $100,000 Phase I grant full- or part-time employees, was driven by the top line,” he said. Group Vice President/Technology, Manufacturing, Circulation za, who is also the company’s chief in 2005, and awarded it a two-year, awarded a nine-month, Phase I “We are driven by doing the right Robert C. Adams financial backer. Phase II grant of $500,000 last year. grant of $100,000 by the U.S. Air Force thing. We don’t set specific rev- Vice President/Production & Manufacturing “We think SenSound has Bennett said the Phase I grant to begin studying how manufactur- enue targets, and I know that is Dave Kamis Corporate Director/Circulation tremendous potential for testing proved the feasibility of Sen- ers can reduce jet-engine noise. The counterintuitive. If you set targets, Patrick Sheposh powertrain components,” said Sound’s technology. Work under company is looking to hire a pro- it can box you in.” G.D. Crain Jr. Founder (1885-1973) Wayne Schultz, president of the the current grant shows promise grammer and a test engineer. Mazza was president of Memorex Mrs. G.D. Crain Jr. Chairman (1911-1996) EDITORIAL & BUSINESS OFFICES: Livonia-based Advanced Technology at allowing manufacturers to test Mazza said he has not sought out USA, a $300 million division of Mem- 1155 Gratiot Ave., Detroit MI 48207-2732; (313) & Testing division of Dayton-based such things as transmission sys- angel or venture-capital invest- orex, in the late 1980s. In the early 446-6000 Cable address: TWX 248-221-5122 AUTNEW DET Assembly & Test Worldwide L.L.C. tems in the noisy environment of ment so far. The farther toward 1990s, he was CEO of an Italian soft- Subscriptions $59 one year, $98 two years. Out Schultz has one SenSound sys- the factory floor, instead of requir- commercialization they go before ware company. From 1993 to 1999 he of state, $79 one year, $138 for two years. Outside U.S.A., add $48 per year to out-of-state tem in his testing lab and plans to ing them to take the time and ex- taking on investment money, the was president and CEO of the Ameri- rate for surface mail. begin incorporating SenSound pense of taking components to qui- more equity founders retain. But can National Standards Institute in Reprints: For inquiries call the reprints department at: (800) 494-9051, Ext. 144 , or at technology into systems for sale by et rooms for testing. he said the company may start New York City, a nonprofit that co- [email protected] the end of this year. He said his Bennett said SenSound’s soft- looking for VC partners soon. ordinates a wide range of standards CRAIN’S DETROIT BUSINESS ISSN # 0882-1992 is published weekly by Crain Communications Inc. at company sells test and quality-con- ware can extract signals it is look- The company had 2005 revenue for American industry. 1155 Gratiot Ave., Detroit MI 48207-2732. trol equipment to automotive ing for while disregarding other of $800,000. Mazza said 2006 rev- A co-founder with Mazza and Periodicals postage paid at Detroit, MI and additional mailing offices. POSTMASTER: Send OEMs, and tier-one and tier-two loud, background noises. In addi- enue figures haven’t been released Wu was Gary Kendra, a Northville address changes to CRAIN’S DETROIT BUSINESS, Circulation Department, P.O. Box 07925, Detroit, suppliers in the U.S., China, Ko- tion to better quality-control, it is and declined to give revenue pro- attorney who helped take Ann Ar- MI 48207-9732. GST # 136760444. Printed in rea, Australia, India, Mexico, also hoped the technology will also jections for this year. He said the bor-based Genomic Solutions Inc. U.S.A. Entire contents copyright 2007 by Crain Canada and Brazil. show ways to reduce noise made company has sold to companies in public in 2002. Communications Inc. All rights reserved. “We are very hopeful we will be by manufacturing equipment. the U.S., Canada, Germany, South Tom Henderson: (313) 446-0337, Reproduction or use of editorial content in any manner without permission is strictly prohibited. able to find defects in products we “It has significant commercial Korea and China, and that stan- [email protected] DETROIT BUSINESS MAIN 05-14-07 A 26 CDB 5/11/2007 6:22 PM Page 1

Page 26 CRAIN’S DETROIT BUSINESS May 14, 2007 RUMBLINGS WEEK IN REVIEW FROM WWW.CRAINSDETROIT.COM, WEEK OF MAY 5-11

“Windows To the Future” Travel Michigan begins new and money raised from the RBS-led group auction will benefit the ad campaign Ovshinsky warehouse and its pro- Travel Michigan, the grams. A preview of a col- makes hostile tourism division of the laborative display of works Michigan Economic Develop- from the nearby Contempo- ment Corp., launched new rary Art Institute of Detroit is bid for ABN gets extension television and radio com- also planned. mercials last week. Also available at the auc- Amro, LaSalle The launch is part of an tion will be birdhouses cre- advertising campaign ated by local students. called “Pure Michigan,” on options A shuttle will run be- etherlands-based which promotes the state as tween the warehouse and ABN Amro Holding N.V. a vacation destination. n Tuesday, EDS Corp. is considering DETROIT INSTITUTE OF ARTS art institute. N said Monday that it According to a news re- Rochester Hills- moving its remaining 1,400 The event is from 6-10 received a hostile takeover lease, out-of-state commer- O based Energy Conver- Troy employees to Pontiac p.m. at the warehouse at bid of $96.4 billion and a re- LAWSUIT ENDS cials began airing in Chica- sion Devices Inc., filed an 8-K to refill part of the space va- 4885 15th St. Tickets are $85 lated bid of $24.5 billion for go, Cleveland, Indianapolis, report with the U.S. Securi- cated by General Motors and are available at the Heirs of Martha Nathan, a its Chicago-based LaSalle previous owner of the Milwaukee, Cincinnati, ties and Exchange Commis- Corp. employees who were door or in advance at Bank Corp. subsidiary from Detroit Institute of Arts’ Van and Ontario, totaling $8.7 sion announcing that the moved to Warren. aswdetroit.org/alchemy. a consortium led by the Roy- Gogh painting “The million in buys. board of directors, “in hon- “There have been so far al Bank of Scotland Group plc. Diggers” (above), have According to Travel or of the late Dr. Iris M. numerous companies ex- BITS AND PIECES ABN Amro said it would dropped their claims to Michigan, the Michigan Ovshinsky’s contributions to pressing interest but no ownership of the painting, place the bids before share- media buy is $1.5 million. the growth and success of contracts signed,” said Jea- Ⅲ Cynthia Pasky, founder holders without an en- ending a dispute dating to the company,” had voted to nine Fruehan, a spokes- president and CEO of De- dorsement. It said it would- 2004. Nathan’s descendants had requested honor her. woman for GM. troit-based Strategic Staffing n’t endorse the offers BRIEFLY Iris, the company co- GM’s partner in the Cen- the return of the 1889 Solutions; Ronald Hall, presi- because of attached condi- Ⅲ Northwest Airlines Corp. founder, terpoint painting, claiming in part, dent and CEO of Bridgewater tions. that it had been sold under has filed an application died Aug. business Interiors L.L.C., also in De- May 3, a Dutch court Nazi duress by Nathan, a with the New York Stock Ex- 16. campus troit, and William Young, blocked the sale of LaSalle German Jew. change to list on the ex- The hon- in Ponti- chairman, president and to Bank of America Corp. for Also, Detroit Institute of change under the ticker or? To ex- ac, Etkin $21 billion, responding to Arts President Graham Beal symbol NWA when it tend the Equities, CEO of Plymouth-based hostile ABN shareholders said Wednesday that the emerges from bankruptcy deadline also had Plastipak Packaging Inc., angry about both that pend- DIA had passed the halfway in June. Also, the airline for her no com- were inducted into the Ju- point of its $180 million ing deal and a pending deal said that about 97 percent husband, ment, nior Achievement of South- campaign, after raising $10 to sell ABN Amro to Lon- of its voting creditors ap- Stan Ovshin- nor did eastern Michigan’s Business million in less than three don-based Barclays plc for proved its reorganization sky, to ex- EDS. Hall of Fame at a May 10 months. $90.1 billion. plan, the Detroit Free Press ercise op- General awards dinner at the Detroit LaSalle Bank Corp. is the reported. The plan must tions for Motors Yacht Club. dent Vladimir Putin, and his parent to both Chicago- holding company, Basic Ele- still be confirmed by a 155,465 said late Ⅲ Logicalis Inc., a Bloom- based LaSalle Bank N.A. and ment, controls majority judge. shares of last year field Hills-based provider of Troy-based LaSalle Bank stakes in Russian manufac- Ⅲ Citizens Republic Ban- company A window designed by Teresa Petersen it was servers, storage, and soft- Midwest N.A. corp (Nasdaq: CRBC) said stock that for the Urban Alchemy preview. moving turing, energy and metals ware, has won IBM’s top Bank of America doesn’t Tuesday that it has com- were to ex- 3,600 em- interests. Basic Element award for business part- have a Michigan presence, pleted the integration of Re- pire this summer. ployees out, mostly to the owns a controlling stake in ners, the IBM Business which might mean contin- Russia’s No. 2 automaker, public Bank branches and The options had been GM Tech Center in Warren, Partner Excellence Award. ued life for a local head- GAZ Group, maker of vehi- customers into Citizens. granted to Iris in 1993 and by 2008. Ⅲ Skillman Foundation quarters if it can buy cles sold under the Volga Ⅲ Nearly 400 students at 2000. Previously the board President and CEO Carol LaSalle. It would also likely and Gazelle brands. the Wayne State School of voted to grant Stan the op- Urban Alchemy turns scrap Goss in late April received mean many of LaSalle’s 261 Medicine signed a petition tion of exercising them, with windows into art auction the James A. Joseph Lecture branches in Michigan Final financing closes urging Michigan State Uni- an expiration date on the Award from the New York would remain open. versity to locate MSU’s satel- first anniversary of her Scrap windows from De- City-based Association of for Pick-Fort Shelby lite medical campus at Ma- death. Now, he will have an- troit buildings that have comb Community College. Black Foundation Executives. Magna: More partners The development team other year for them to pay been transformed into ■ Ⅲ The Oakland County The Detroit Science Cen- restoring the Pick-Fort Shel- off. works of art will be auc- ter has extended the run of possible in Chrysler bid Board of Commissioners on According to ECD’s most by Hotel in Detroit said tioned as part of the Urban its exhibit, “Our Body: The Magna International Chair- Thursday voted 13-9 against recent proxy statement, Alchemy preview set for Wednesday it had closed a nonbinding resolution Universe Within” through man Frank Stronach said the last piece of financing Stan Ovshinsky exercised May 24. that would have rejected Sept. 3. Thursday that Magna could for the deal. options worth $5.2 million The preview is a fund- Wayne County Executive The exhibit had been bring in additional part- Crain’s reported April 30 in its last fiscal year, and raiser for Architectural Sal- Robert Ficano’s $968 million ners in its upcoming bid for the last piece of financing Iris Ovshinsky exercised vage Warehouse of Detroit, a scheduled to close on May plan to expand and reno- the Chrysler Group, Automo- left was a $14 million con- options worth $3.1 million. nonprofit dedicated to keep- 28 after a nearly five-month vate Cobo Center in De- tive News reported. struction loan from Shore- ing Detroit’s architectural run. troit, The Detroit News re- The Canadian auto-sup- Bank, which only left legal EDS may move Troy heritage out of the landfill. The exhibit is comprised ported Oakland County ply giant has been working details such as reviewing The windows, revamped of 20 actual human bodies Executive L. Brooks Patter- workers to Pontiac with Canadian investment the final terms of develop- by 19 Detroit artists, are and 135 anatomical dis- son has been a prominent firm Onex Corp. on the con- ment. Office brokers say that part of an exhibition called plays. critic of the Ficano plan. templated offer for The $82 million project Ⅲ Two ex-Detroit police Chrysler. But the possibili- will convert the building officers who sued Mayor ty of additional partners Doubletree Hotel into a with Kwame Kilpatrick in 2003, likely would diminish 204 rooms, 63 apartments, claiming he slandered and Magna’s potential stake. 38,000 square feet of confer- retaliated against them af- Our space is your space DaimlerChrylser Corp. is ex- ence and meeting space, ter their investigation of al- pected to reach an agree- A few weeks back we launched our Best of all, it’s not maintained by and a bar and restaurant. leged wrongdoing by the very own Crain’s Detroit Business me. It’s managed by the folks who ment to sell the automaker Doubletree is owned by mayor and his security MySpace page. help make our amazing events, well, as early as this month. Oth- Beverly Hills, Calif.-based staff, presented their case amazing. If you head there this week, With more than 370 friends and er leading bidders are pri- Hilton Hotels Corp. to the Michigan Supreme counting, we’re taking the MySpace you’ll be treated to photos from our vate equity firms Cerberus The ownership team ex- 20 in their 20s event and links to Court last week. The ex-offi- community by storm. On this Capital Management and pects construction to begin online video coverage. cers claim they are entitled extension of our site, you can Blackstone Group. in the next 30 days and be network with the people, So check out our page and see what to protection as whistle- Also on Thursday, businesses and bands that are all the MySpace hype is about. We’re complete in early 2009. blowers; the city disputes reading our publication week in and adding new information, links and Magna announced a plan to The lead developer is The that. week out. multimedia applications on a regular sell a $1.54 billion stake in Moten Group of Detroit, the If you’re not a MySpace member, basis. its ownership to an affiliate construction team is con- OBITUARIES signing up is free and easy. If you WEB WORLD If you have thoughts on the page or of Russian industrialist tractor L.S. Brinker Co. of De- are already a MySpace user, surf to Daniel Eizans have an idea you’d like to see Oleg Deripaska. troit and the architect is Ⅲ Robert “Butch” Edgar, myspace.com/cdbonline and add executed on it, e-mail me at Deripaska is politically Hobbs + Black Architects of publisher of the Grosse us as your friend. [email protected]. connected to Russian Presi- Ann Arbor. Pointe News, died May 10. DBpageAD.qxd 5/4/2007 10:02 AM Page 1

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