20110606-NEWS--0001-NAT-CCI-CD_-- 6/3/2011 7:10 PM Page 1 ® This issue in two sections (Section 1) Vol. 27, No. 23 JUNE 6 – 12, 2011 $2 a copy; $59 a year ©Entire contents copyright 2011 by Crain Communications Inc. All rights reserved Page 3 Shaky signs from market ALEC AND TOM GORES:DEALMAKING IN DETROIT may delay Delphi IPO plans Bankrupt Borders says bids coming in Soaking up the sun helps Reports: Investor Alec Gores in the mix finance Royal Oak project BY DANIEL DUGGAN Alec Gores, brother of new Detroit Pistons CRAIN’S DETROIT BUSINESS owner Tom Gores, is among the investors re- portedly interested in a portion of the book- Inside While a New York bankruptcy judge gave seller. A call placed to Alec’s office was not re- Borders Group Inc. until Oc- turned Friday, nor has he issued comments to tober to craft a restructur- other media outlets. S3’s ing plan, the company TWO OF A KIND Borders attorneys said in court last week might not need it. Gores brothers: that there are “multiple” bidders for the com- ‘inshoring’ Despite the Ann Arbor- Steeped in pany, but they would not disclose the names. based company’s bleeding dealmaking, The deal brokering comes as rival Barnes & creates Page 18 COURTESY OF SITRICK AND CO. INC. balance sheets two months Noble Inc. is in a bidding war between two bil- hundreds of A source says private equity investor Alec Gores, into bankruptcy, offers are lionaires. brother of Detroit Pistons owner Tom Gores, is swirling for the company. An attorney in the case jobs ahead of bidding for roughly half of Borders’ 405 stores. says a deal may happen in two to four weeks. See Borders, Page 18 schedule, Page 12 Street vendors find Detroit ‘Shocking’ bargain: Gores pays $325M for Pistons food rules unappetizing, BY BILL SHEA management company. The sale price Tom Gores Page 17 CRAIN’S DETROIT BUSINESS from the deal, which closed Wednesday, said he has was confirmed by a source with direct no plans to spin off Tom Gores made his billions by identi- knowledge of the deal. anything This Just In fying companies he could buy cheaply, fix One insider familiar with pro sports and spin off for a tidy profit. from his franchise sales, who spoke on the condi- purchase of Insiders say he used his acumen at tion of anonymity, was flabbergasted at the Pistons Collaboration tops spotting a good deal to get the Detroit Pis- what Gores paid to assume majority own- and Palace chamber’s to-do list tons and Palace Sports & Entertainment Inc. ership from Karen Davidson. Sports & for a price far below what they expected: “That is a shocking price,” he said. “If Entertain- Improving collaboration $325 million. he got the team and the real estate (for ment Inc. between East and West Michi- That’s for both the National Basketball gan businesses and key insti- Association franchise and the umbrella See Pistons, Page 19 tutions tops a to-do list for the BILL SHEA/CRAIN’S DETROIT BUSINESS Detroit Regional Chamber. The list, released Friday at the close of the chamber’s Mackinac Policy Conference on Mackinac Island, contains goals for the chamber to ac- Power of positive pushing: The ‘Snyder effect’ at Mackinac complish over the next year. They include: BY AMY LANE ous governors, was omnipresent Ⅲ Incorporating leading AND NANCY KAFFER during the conference, making SHEDDING LIGHT ON REMAKING MICHIGAN and promising industry clus- CRAIN’S DETROIT BUSINESS four stage appearances during ters into regional economic which he was Michigan is fighting to remake itself into a hub for development strategy. MACKINAC ISLAND — After a both consistent- innovation and job creation. Ⅲ Working with Harvard couple of years when the atmos- ly positive about That awareness shaped the 2011 Detroit Business School Professor phere at the Mackinac Policy Confer- the future and Regional Chamber Mackinac Policy Conference. Executives mostly applauded ence was more subdued than other- resolutely on- Michael Porter, who ap- Gov. Rick Snyder’s way of tackling the peared at a conference ses- wise, the tone at this year’s event message with issues. And the conference’s tone was sion, to convene Great Lakes was decidedly upbeat. low-key but me- noticeably upbeat. Call it the Snyder effect. thodical and re- See This Just In, Page 2 Coverage of the conference continues on Gov. Rick Snyder, unlike previ- lentless requests Page M1 (following Page 12), including news for support for of a new “buy Michigan” initiative for the measures he business, and a primer on economic clusters. Snyder says are needed Also featured: to make Michigan competitive. Ⅲ Innovations: Advanced Manufacturing — Thriving “Solve a problem and just move companies from the automotive sector and beyond, on to the next problem and keep Page M17 going. And that’s critical to our fu- Ⅲ Focus: Business Education — Debating tenure ture,” Snyder said in a Friday at the university level, Page M31 morning address. NEWSPAPER See Mackinac, Page 21 20110606-NEWS--0002-NAT-CCI-CD_-- 6/3/2011 7:02 PM Page 1 Page 2 CRAIN’S DETROIT BUSINESS June 6, 2011 will complete a move from its 32- that combine private capital with Wayne State executive ber CEO. THIS JUST IN year home at the Renaissance funds from the U.S. Small Business Schlichting, 56, is CEO of Henry Center to the Southfield Town Administration. adds chief of staff to title Ford Health System. She also was ■ Center by early September, its lo- Sam Munaco, president of Ad- appointed to the board of the Amer- From Page 1 Wayne State University’s Michael cal managing partner confirmed vocate Commercial Real Estate ican Hospital Association this year. Wright, vice president of market- governors to develop a Great Friday. — Jay Greene Advisors of Michigan LLC in South- ing and communications, is also Lakes “super region” strategy. The law firm, a mainstay at the field, advised Pepper Hamilton now the chief of staff for universi- Ⅲ Chamber President and CEO RenCen with 34,750 square feet on in the lease deal. CB Richard Ellis ty President Allan Gilmour. Sandy Baruah said Porter offered two floors of Tower 100, will start Snyder plans East Asia trip in Southfield represented The Wright joined WSU in 2007 as that, if the Great Lakes governors relocating its 60 Detroit employ- Blackstone Group LP, the real es- an associate vice president and Gov. Rick Snyder is planning to wanted to get together for a ees to about 22,000 of space in the tate private equity and invest- was promoted to vice president go to Japan this fall in a trade and strategic session on finding com- 4000 Town Center building in late ment firm that owns the Town last year. relationship-building trip that mon issues and mapping a strate- August, Thomas Wilczak said. Center. Before WSU, he was a senior could also include stops in South gy to work collaboratively, “he “One of the things that’s hap- — Chad Halcom vice president and group account Korea and China. would be happy to come back, pening in the profession is office and Daniel Duggan director at ad agency Leo Burnett The Michigan Economic Develop- and do that gratis.” space needs just aren’t what they Detroit. He’s also held positions in ment Corp. is putting together a Ⅲ Convene institutions and used to be,” he said of the move. marketing and communications work group to build the itinerary, leaders to drive “Outsource to De- “Your professional space is gen- Office managing partner named at General Motors Co. and Ford Mo- plans and schedule for the trip, troit.” That’s a reference to an ef- erally smaller, and ... shrinking which is being eyed for late Sep- fort by health care IT company our space here wasn’t actually for Baker Tilly’s Michigan region tor Co. Wright earned a bachelor’s in tember or early October. GalaxE Solutions Inc., which sees quite as cost-effective as finding a Snyder made mention of the Alan Whitman has been named business administration from the potential for downtown De- new smaller space somewhere trip on Friday at the Detroit Re- the new office managing partner Eastern Michigan University and an troit to be an IT hub and an alter- else.” gional Chamber’s Mackinac Policy for the Michigan region of Baker MBA from University of Michigan. native to work going offshore. Pepper Hamilton, with an esti- Conference. Tilly. He joined the firm in 2003 — Dustin Walsh Ⅲ Convene business, labor and mated $313.5 million in 2010 rev- — Amy Lane educational leaders to develop enue, has 21 attorneys and five and had been firm-wide leader of and document the benefits of do- paralegals in Detroit, compared international services. Schlichting to head Mackinac ing business in a globally compet- with 29 local attorneys in Janu- Whitman replaces Craig Nelson, CORRECTION itive Michigan. ary 2008 and 38 in the 1990s, ac- who came to the Southfield office Nancy Ⅲ Establish a mentorship ini- cording to past data furnished to from the firm’s Madison, Wis., Schlichting ■ An incor- tiative that engages past gradu- Crain’s. The firm cleared out headquarters in 2006. Nelson was named rect photo of ates of the chamber’s Leadership from space it had occupied on a transferred back to Madison, his first vice Michael Detroit program. third floor in the RenCen several hometown. chair of the Psarouthakis Ⅲ To-be-determined steps in- months ago. Baker Tilly, which has a staff board of the appeared volving education. The Detroit lawyers specialize of more than 1,350, is the 16th Detroit Region- with a Calen- — Amy Lane in corporate law, bankruptcy and largest accounting and consult- al Chamber and dar item on reorganization, and labor rela- ing firm in the country, with oth- will be in Page 16 in to- tions.