Posco hunts joint ventures - Crain's Detroit Business

DTE green spending drive energizes state business

World Watch: Michigan biz in Spain, Portugal, 7

Largest Michiganmanufacturers, Page 14Largest group healthproviders, Page 27

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St. Joseph Mercy plans$29.3 million addition

St. Joseph Mercy Hospital AnnArbor has submitted plans tothe state for a $29.3 million,two-story hospital addition.

The hospital said in a let-ter of intent last month to theMichigan Department of Com-munity Health that it wants toreplace nine outpatient oper-ating rooms with new roomsthat are double the size to ac-commodate robotic equip-ment. The plans are subjectto certificate-of-need ap-proval.

The existing hospital oper-ating rooms are outdated andtoo small, said SuzetteBouchard-Isackson, vice presi-dent of surgical services as St.Joseph Mercy Health System.

The second story of the ad-dition would be turned intotwo spaces for hybridoperat-ing rooms that can be usedfor surgery or radiology.

St. Joseph plans to havethe rooms fully operationalby spring 2014.

— Ryan Kelly

This Just In

Page 3

Crain’s Lists

BY DUSTIN WALSH

CRAIN’S DETROIT BUSINESS

To capitalize on the growingglobal automotive market, theSouth Korean steel conglomeratePosco Ltd. is opening its wallet tospend at least $2 billion to createup to 200 joint ventures — manywith suppliers headquartered inSoutheast Michigan.

Posco, along with its interna-tional trading subsidiary DaewooInternational, looks to own up to 20percent of these joint ventures.

It’s interested in creating ven-tures with auto suppliers, includ-ing metal stampers for doors andchassis as well as motor manufac-turers, said Steven Bigatti, execu-tive director of business develop-ment at Posco’s North Americabusiness group in Troy.

“We feel in the future of thesupply business, companies willhave more vertical integration,”he said. “We have the raw materi-al, and this is a way to participatein this trend of reverticalizationof the supply base while main-

taining our core competenciesand matching up with the tech-nology know-how we just don’thave.”

Posco plans to announce theplan today in South Korea.

Bigatti said each of the 200 jointventures would have a bench-mark of reaching $50 million inrevenue by 2020, contributing $10billion in revenue overall.

Posco is interested in access tonew markets and technology

BY BILL SHEA


Major League Baseball’s threenew television contracts will covermuch of the premium that the De-troit Tigers are paying for sluggerPrince Fielder and his nine-year,$214 million contract.

Baseball analysts expect thenew TV deals to give the Tigers anadditional $26 million in sharedrevenue from MLB’s Central Fundstarting in 2014. That means theteam will receive almost $90 mil-lion collectively from its local ca-ble deal with Fox Sports Detroit andthe shared national broadcast con-tracts.

Fans and pundits have worriedthat Tigers owner Mike Ilitch wasmortgaging the future by signingFielder in January to a free-agentdeal that pays him $23 million thisyear and in 2013, before increasingto $24 million annually.

The Tigers already were on thehook for mega-deals with MiguelCabrera (eight years, $152.3 mil-lion through 2015) and Justin Ver-lander (five years, $80 millionthrough 2014).

The influx of new TV moneyshould assuage payroll worry.

“The Tigers have the treasury toafford that kind of contract. More-over, the club is looking at a rev-

BY NATHAN SKID


Detroit’s Cheesecake Bistroopened with a Sept. 27 party, con-troversial entrepreneur La-VanHawkins and a lot of questions.

What it didn’t open with was aliquor license, health departmentsignoff or business license —something not known to its VIPguests that included the Detroitmayoral trio of Dave Bing, DennisArcher and Kwame Kilpatrick.

One, and maybe two, of thoserequirements have since been sat-isfied, but the restaurant as ofFriday wasn’t able to legallyserve alcohol to the general pub-lic.

It’s the latest episode in thecontroversial career of Hawkins,who entered the Detroit marketin the 1990s, and now is re-enter-

ing it following a stint in prison.Hawkins doesn’t own the

restaurant — he’s a convictedfelon and can’t hold a liquor li-cense in Michigan — but he’s aconsistent presence there, some-times chatting with guests, andon one occasion at least, sippingsparkling wine while being at-tended by a waiter.

Who does own it isn’t entirelyclear.

Hawkins said he’s a consultant

to restaurant owners Chicagorestaurateur Jerry “Magic Man”Kleiner and anesthesiologist Dr.David Tomkin, who hold therestaurant under CheesecakeBistro LLC, incorporated inDelaware.

In an earlier interview, Kleinerdenied involvement with therestaurant.

“I am not involved in any form

New TV dealsshould coverPrince-lypaychecks

Posco hunts joint venturesSteelmaker wants access to new markets

Servingoff themenu

Wake up to Michigan business news in your inbox each morning.| Learn more at crainsdetroit.com/morning

StartingOCT. 15

CRAIN’S MICHIGAN BUSINESS

See Bistro, Page 30

NATHAN SKID/CRAIN’S DETROIT BUSINESS

La-Van Hawkins says the liquor license for Detroit’s Cheesecake Bistro shouldcome through this week.

ANDREW TEMPLETON

See Tigers, Page 33

See Posco, Page 32

DUANE BURLESON/THE ASSOCIATED PRESS

Detroit Tigers Miguel Cabrera andPrince Fielder celebrate a Cabrerahome run Aug. 24 at Comerica Park.

Bistro opens withLa-Van Hawkins,questions, but

no liquor license

Detroit’sCheesecakeBistro takes theplace of theformer SweetGeorgia Brownon Brush Streetnext toGreektownCasino.

Wading inMichigan tests waters of ‘blue economy,’Page 11

20121008-NEWS--0001-NAT-CCI-CD_-- 10/5/2012 6:18 PM Page 1

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October 8, 2012CRAIN’S DETROIT BUSINESS

CEO offers employees a bonus with added bonus: Voting advice

MLive.com’s Jim Harger report-ed last week that the 2,300 employ-ees at Grand Rapids-based Lacks En-terprises got something extra in aletter telling them they would begetting a bonus — their sixth in thepast three years. That added valuewas this passage from the letterfrom President Richard Lacks:

“The talk of additional tax in-creases by the administration, if re-elected, will have an additional neg-ative impact on the organization. …It is important that in Novemberyou vote to improve your standardof living, and that will be throughsmaller government and less gov-ernment.”

The suggestion being: Voting forPresident Barack Obama may notbe the best option.

Jim Green, executive director ofhuman resources, said Lacks En-terprises survived the auto indus-try downturn not because of theU.S. government’s bailout but “be-cause of our business model andthe money we have in the bank tosurvive these downturns.”

Rival to Detroit water system is step closer to Lake Huron pipeline

While workers at the Detroit Waterand Sewerage Department walked thepicket line last week, another water

entity got closer to tapping intoLake Huron and, in the process,perhaps snatching a customer fromthe Detroit system. The state ap-proved a permit allowing the Kareg-nondi Water Authority to tap into LakeHuron with a 1.5-mile undergroundintake, MLive.com reported.

The authority — comprisingGenesee, Lapeer and Sanilac coun-ties and the cities of Lapeer andFlint — has said it would build thepipeline so the communities couldbecome independent of the Detroitsystem. Flint is Detroit’s largestcustomer, representing 5 percent

of sales, Crain’s Michigan Businessreported in January.

A Karegnondi study claims thatcontinuing to buy water from De-troit would cost the region $2.1 bil-lion in the next 25 years. By build-ing a pipeline, that would be $1.9billion. After the initial 25-year pe-riod, water would cost less than 25percent of the projected cost of De-troit water, Karegnondi said.

MICH-CELLANEOUS� Stryker Corp. last week named

Kevin Lobo, president of its ortho-

pedics business, as the new presi-dent and CEO of the Kalamazoo-based medical device maker, effec-tive immediately. Lobo, 47,replaces Stephen MacMillan, whoresigned in February for “familyreasons.”

� Walker-based Meijer Inc. saidit plans to hire 12,000 employees toprepare for the holiday season andhandle growth. Besides Michigan,the retailer has stores in Ohio, In-diana, Illinois and Kentucky.

� Lansing-based Neogen Corp.has acquired Fort Collins, Colo.-based Macleod Pharmaceuticals.

Neogen makes food and animalsafety products. The price of theall-cash purchase won’t be dis-closed until Neogen’s next quarter-ly filing, the company said.

MICHIGAN BRIEFS

Before Nick Wierzba and his wife moved to Michi-gan in mid-March, he spent seven years at Napa Val-ley Bike Tours leading thousands of people on treksthrough California’s wine country — without a pathspecifically for bicycles.

So when Wierzba and wife Kasey heard that morebike trails were being paved in Michigan’s own ver-sion of Napa Valley — the Leelanau Peninsula —“that was kind of the kick in the pants to say hey, ifwe don’t open a bike shop, somebody’s going to opena bike shop,” Wierzba said.

In June, they set up Suttons Bay Bikes-Grand Tra-verse Bike Tours in Suttons Bay.

“If this were in Napa, California, many, manymore people would ride their bikes to and from thewineries,” Wierzba said.

One of those wineries, Black Star Farms, has seenmore customers on two wheels at its locations inSuttons Bay and Old Mission Peninsula, said Coryn

Briggs, director of marketing at the winery. “Along the Old Mission Peninsula, bikers will of-

ten stop for a sample and return after the ride to pur-chase because they don’t have any place to store thewine on their bikes,” Briggs said. “At our SuttonsBay location, we have seen a big increase of bikerson tours arranged and facilitated by Grand Tra-verse Bike Tours.”

The network of paved trails has been in the worksfor two decades, when planning began on a 15.5-milepaved alley, built on a former railroad corridor andconnecting Traverse City with Suttons Bay. Last sum-mer, the final 6.2 miles of the Leelanau Trail was paved.

This past summer also saw the ribbon-cutting onthe first four miles of the Sleeping Bear Heritage Trail,which promises eventually to take bicyclists fromthe southern edge of Leelanau County through Sleep-ing Bear Dunes National Lakeshore to Good Harbor Bay.

— Howard Lovy

Trails bring 2-wheel tourism to N. Mich. businesses

Find business news fromaround the state at crainsdetroit.com/crainsmichiganbusiness.

Sign up for Crain’s MichiganBusiness e-newsletter at crainsde-troit.com/emailsignup.

CORRECTIONS� The 40 under 40 profile storyon Jeffrey Laethem on Page 19 ofthe Oct. 1 edition included an in-correct revenue figure for RayLaethem Buick-GMC and RayLaethem Motor Village. The dealer-ships report annual revenue ofabout $90 million.� The 40 under 40 profile onBernard Fuhs, on Page 17, shouldhave said he was a basketballcommentator for high schoolplayoff games held at MichiganState University.� A story on Page 11 of the Sept.24 issue incorrectly stated thatHealth Alliance Plan CEO WilliamAlvin received a 21 percent in-crease in base pay in 2010. Com-pensation reported for Alvin for2009 was for only 10 months, giv-en that he joined HAP in Marchof that year. His base pay did notincrease in 2010.


October 8, 2012 CRAIN’S DETROIT BUSINESS

These companies have significant mention in thisweek’s Crain’s Detroit Business:Aetna . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Altair Engineering . . . . . . . . . . . . . . . . . . . . . . . . . 17

Amway . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Arts, Beats & Eats . . . . . . . . . . . . . . . . . . . . . . . . 31

Bank of America . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Barton Malow . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Beaumont Health System . . . . . . . . . . . . . . . . . . . 21

Beaumont Physician Organization . . . . . . . . . . . . . . 3

Blue Cross Blue Shield of Michigan . . . . . . . . . . . . 24

Chase Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Chrysler Group . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Comerica Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Detroit Medical Center . . . . . . . . . . . . . . . . . . . . . . 7

Detroit Tigers . . . . . . . . . . . . . . . . . . . . . . . . . . 1, 33

Detroit’s Cheesecake Bistro . . . . . . . . . . . . . . . . . . 1

Domino’s Pizza . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Downtown Market . . . . . . . . . . . . . . . . . . . . . . . . 15

DTE Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Dwelling Place . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Engineering Society of Detroit . . . . . . . . . . . . . . . . 12

Federal-Mogul . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Flagstar Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Fox Sports Detroit . . . . . . . . . . . . . . . . . . . . . . . . . . 1

General Motors . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Grand Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Great Lakes HIE . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Greater Detroit Area Health Council . . . . . . . . . . . 26

Guardian Industries . . . . . . . . . . . . . . . . . . . . . . . 29

Haworth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Howard & Howard . . . . . . . . . . . . . . . . . . . . . . . . . 30

Huntington Bank . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Hutzel Women’s Hospital . . . . . . . . . . . . . . . . . . . . 7

Hydra Professionals . . . . . . . . . . . . . . . . . . . . . . . 32

Jewish Senior Life Foundation . . . . . . . . . . . . . . . . 22

Kelly Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Key Plastics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Michigan Economic Development . . . . . . . . . . . 3, 12

Michigan Health and Hospital Association . . . . . . 20

Michigan Health Connect . . . . . . . . . . . . . . . . . . . 19

MSX International . . . . . . . . . . . . . . . . . . . . . . . . 17

Oakwood Healthcare . . . . . . . . . . . . . . . . . . . . . . 21

Plante Moran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Posco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Rockbridge Growth Equity . . . . . . . . . . . . . . . . . . . . 3

The Roostertail . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Strategic Staffing Solutions . . . . . . . . . . . . . . . . . 32

TI Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

TriMas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

TRW Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . 17

UAW Retiree Medical Benefits Trust . . . . . . . . . . . 28

United Physicians . . . . . . . . . . . . . . . . . . . . . . . . . . 3

University of Michigan Health System . . . . . . . . . . 21

Visteon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Wayne State University . . . . . . . . . . . . . . . . . . . . . . 7

THIS WEEK @WWW.CRAINSDETROIT.COM

Company index

Department index

Crain’s on TwitterFollow Crain’s staffers bygrabbing their handles atcrainsdetroit.com/twitter.

Miss the show?On Monday mornings, Crain’s Publisher Mary Kramer speakswith Paul W. Smith on WJR AM 760. The segments are alsoposted at crainsdetroit.com/marykrameraudio.

State’s health info exchanges

don’t exchange data, Page 19

Health Care Extra

BANKRUPTCIES . . . . . . . . . . . . . . . . . . 6

BRIEFLY . . . . . . . . . . . . . . . . . . . . . . . 6

BUSINESS DIARY . . . . . . . . . . . . . . . . 18

CALENDAR . . . . . . . . . . . . . . . . . . . . 10

CLASSIFIED ADS . . . . . . . . . . . . . . . . 29

JOB FRONT . . . . . . . . . . . . . . . . . . . . 28

KEITH CRAIN . . . . . . . . . . . . . . . . . . . . 8

LETTERS . . . . . . . . . . . . . . . . . . . . . . . 8

MARY KRAMER . . . . . . . . . . . . . . . . . 11

OPINION . . . . . . . . . . . . . . . . . . . . . . . 8

OTHER VOICES . . . . . . . . . . . . . . . . . . 9

PEOPLE . . . . . . . . . . . . . . . . . . . . . . 28

RUMBLINGS . . . . . . . . . . . . . . . . . . . 34

WEEK ON THE WEB . . . . . . . . . . . . . . 34

BY TOM HENDERSON


Buoyed by a financing commit-ment that should total at least $100million from a major East Coastprivate equity firm, Detroit-basedRockbridge Growth Equity LLC isgearing up to invest an additional$200 million of its own funds as itadds to its portfolio of companies.

To help with that deal flow, Rock-bridge has recruited two veteraninvestment professionals frommuch larger private equity firms:Scott Elkins from Quadrangle Part-ners in New York City, a private eq-uity firm with $3 billion undermanagement, asvice president;and MichaelKaczmarek fromPamlico Partnersin Charlotte,N.C., a firm with$2.1 billion un-der manage-ment, as a seniorassociate.

“We’re callingit Rockbridge 2.0,” said partnerKevin Prokop. Rockbridge was co-founded in 2007 by Prokop, DanGilbert and Brian Hermelin andhas invested about $200 millionthus far. It has completed eightdeals and currently has seven port-folio companies.

Prokop

Rockbridgegets $100Mcommitmentto fuel deals 2 investmentvets recruited

BY JAY GREENE


DTE Energy Co. is on schedulewith its pledge to increase itsspending with Michigan compa-nies by $750 million over fiveyears through 2016 as it takessteps to meet the state’s 10 per-cent renewable-energy standardand move more work to Michiganfrom out-of-state companies.

The spending, targeted towardareas such as solar energy plants,information technology improve-ments and staffing contracts, alsoenables the company to fulfill itscommitment to the Pure MichiganBusiness Connect initiative to pro-mote in-state procurement.

“Wheneverwe go to bid, weinclude at leasttwo Michigancompanies andtwo diversecompanies, andwe have seensome bumps innew businesswith Michigancompanies,”

said Tony Tomczak, DTE’s direc-tor of supply chain management.

Through August, DTE (NYSE:DTE) has increased spendingwith Michigan companies to $498million, including $100 million inSoutheast Michigan, up 49 per-cent from $334 million for thesame eight-month period in 2011,Tomczak said.

About $70 million has beenspent this year on renewable en-ergy, he said.

DTE projects spending $575million this year in Michigan andplans to spend $700 million inMichigan in 2012, Tomczak said.Since 2011, DTE’s $1.3 billion ofMichigan purchasing is estimat-ed to have created more than 6,800full-time jobs, according to theMichigan Economic Development

Corp., which administers the PureMichigan Business initiative.

“DTE Energy’s commitment tothe Pure Michigan procurementinitiative continues to be an en-gine for growth in the communi-ties that we serve,” Gerry Ander-

son, DTE’s chairman, presidentand CEO, said in a statement.

“This has been a tremendouscontribution to the emergingmarket of suppliers that have im-

DTE brings energy to state bizSpending push strives to meet renewables goal

BY JAY GREENE


The Troy-based Beaumont Physi-cian Organization plans to join Bing-ham Farms-based United PhysiciansInc. to create the largest physicianorganization in Southeast Michi-gan, with more than 2,600 physi-cians, said Michael Williams, M.D.,CEO of United Physicians.

“We can immediately beginworking on combining ourstrengths and best practices towork more closely with BeaumontHealth System on strategies for suc-

cess in the changing health careenvironment,” Williams said.

The two physician organizationsare expected to combine operationsby year’s end. At that time, theBeaumont Physician Organizationno longer will be managed withEast Lansing-based Medical Advan-tage Group. Five BPO physicianswill join the 21-member UnitedPhysicians board.

Both physician organizationshave historical ties to BeaumontHealth System.

In 2000, Beaumont Hospital inRoyal Oak had an exclusive physi-

cian organization, Beaumont UnitedPhysician Organization, that spun offto become United Physicians. In2009, some members of UnitedPhysicians left to form the Beau-mont Physician Organization.

“A reunited United Physicians,working closely with BeaumontHealth System, is the winning for-mula for these complex times,”Marc Weisman, D.O., medical di-rector of the Beaumont PhysicianOrganization, said in a statement.

Gene Michalski, CEO of Beau-mont Health System, said healthcare reform is driving hospitals

and physicians to work more close-ly together to improve quality andreduce costs.

“We are look-ing forward toworking with astronger, unifiedphysician orga-nization to re-spond to healthcare changesand challenges,”Michalski said.

“As we workwith the merged physician organi-zation, we will continue to developthe Beaumont Medical Group, made

Physician group to be area’s largest

COURTESY OF BARTON MALOW CO.

One beneficiary of DTE Energy Co. pledging to spend more with Michigancompanies is Southfield construction firm Barton Malow Co., which is doingwind farm work for DTE in the Thumb.

See DTE, Page 32

Beaumont PO plans to join United; 2,600 doctors

See Rockbridge, Page 31

Tomczak

See Doctors, Page 31

Michalski


Chase Bank and Comerica Bank in-creased their deposit market sharesboth in metro Detroit and Michiganfor the fiscal year that ended June30, while Bank of America continuedto see an erosion of market sharethat began after it bought LaSalleBank in October 2007.

The Federal Deposit InsuranceCorp., which compiles the data, post-ed them on its website last week.

Chase retained its top rankingboth in the state and in metro De-troit, with its local share rising to23.72 percent from 21.06 percentthe year before, and its state sharerising from 16.23 percent to 17.51percent.

Comerica kept its No. 2 rankinglocally and in the state, with itsshares rising from 21.09 percent to21.29 percent and from 13.8 percentto 14.21 percent, respectively.

BOA retained its No. 3 rankingin metro Detroit, although its mar-ket share fell from 12.77 percent to11.36 percent. It retained its No. 4ranking statewide, with its sharefalling from 9.06 percent to 8.24percent.

As of June 30, 2008, BOA was No.2 in metro Detroit with a marketshare of 23.3 percent and was No. 1statewide with a market share of15.83 percent.

A big winner locally was Hunt-

ington Bank, which acquired the as-sets of Dearborn-based FidelityBank after it was shut down by reg-ulators in March. Huntingtongrew its market share from 4.17percent to 4.54 percent andclimbed two spots to rank No. 6 inMetro Detroit.

Here are the other top 10 rank-ings for metro Detroit as of June30:

No. 4, PNC, 10.53 percent; No. 5,Flagstar, 7.43 percent; No. 7, Char-ter One, 4.53 percent; No. 8, FifthThird, 4.46 percent; No. 9, TCF, 2.31percent; No. 10, Citizens, 1.35 per-cent.

— Tom Henderson

The news last week that MichaelTierney was replacing JosephCampanelli as president and CEOof both Troy-based Flagstar Bank

and its holdingcompany,Flagstar Ban-corp Inc., wasthe latest chap-ter in what hasbeen a long ca-reer in localbanking.

The last twoand a halfyears have

been particularly interesting forTierney, 57, who had spent 28years at Comerica Bank in a varietyof roles, most notably as seniorvice president of personal finan-cial services, overseeing thebank’s 256 branches.

At the beginning of March 2010,Tierney was president and CEO atMadison Heights-based PSB GroupInc., the bank holding company forPeoples State Bank, one of the state’soldest community banks, havingbeen founded in Hamtramck in1909. The bank was then beginningto have serious trouble in its com-mercial loan portfolio and would beshut down by state and federal regu-lators in February 2011.

But Tierney avoided that spiraldownward, leaving the bank onMarch 16 to become president andCEO of Bluewater Bank Group, whichwas formed to try to buy strugglingCitizens First Bank in Port Huron.On April 30, First Michigan Bank ofTroy, now known as Talmer Bankand Trust, beat out Bluewater’s bid.

In February 2011, Tierney washired by Campanelli to head upMichigan operations and jump-start Flagstar’s commercial lend-ing operations. Last Wednesday,Tierney and Campanelli, 56, whohad been brought in to turn thebank around in September 2009 byits biggest investors, New York-based MatlinPatterson Thrift Invest-ments LP, talked with Crain’s re-porter Tom Henderson about thechange at the helm.

The press release said Joe will re-sign on Oct. 31 to pursue “other inter-ests.” That often is code for “gotfired.” My guess is in this case, Joe re-ally is pursuing other interests, that

now that the bank is profitable againand no longer in danger of beingdelisted by the New York Stock Ex-change, his mission was done. True?

Campanelli: It is. This is part of along, thought-out strategy. It’sgreat having a CEO who liveshere, who lives and breathesMichigan. We were lucky Mikejoined us. It was never in the cardsfor me to relocate here. I have a 12-year-old son and an 18-year-oldson, and my daughter is a senior atBoston College.

Tierney: Joe and I hit it off rightaway. The first night I met, Ithought, “This is a guy with a greatvision.” He’d put together a greatteam. What attracted both Joe andme to this company was that it wasa company that was big enough toreally matter. If we turned thisaround, we could be part of Michi-gan’s turnaround. Flagstar hadbeen focused on raising some de-posits to support the mortgage busi-ness, but it hadn’t been doing com-mercial at all. Joe asked me to comein and grow retail, and we’vegrown it quite a bit.

Did you know from the start thatyou’d replace Joe as president andCEO?

Tierney: We had a successionplan.

Campanelli: But we tried not tomake it public. It was clear fromday one: Mike was Mr. Michigan.He had a wealth of knowledge andit would make for an orderly tran-sition.

You’ve commuted here all along,haven’t you? Flying back to theBoston area on Friday, flying backhere on Monday?

Campanelli: Three years on Deltais a long time. But it’s bittersweet.I became a very big fan of Michi-gan.

So, what are the proverbial “otheropportunities?”

Campanelli: We’ll see what hap-pens. My wife has a few thingslined up. I’m afraid she’s doingsome planning right now.

Flagstar is scheduled to go on trialin New York on Oct. 9 in a suit seekingat last $82.4 million in damages overinsurance on securities backed byhome equity loans made in 2005 and2006. Joe’s departure had nothing todo with the lawsuit?

Campanelli: None. It was all lega-cy stuff that happened well before Igot here. We’ll get through it.

The commercial loan portfolio thatultimately took down Peoples was puttogether before you joined the bank.You had gone from one big bank, Com-erica, to a bigger bank, Chase, thendecided to take the entrepreneurialplunge by becoming a communitybanker. That didn’t exactly work outthe way you hoped.

Tierney: I certainly got there atthe absolutely wrong time in theeconomic cycle. I took over aspresident and CEO on Jan. 1, 2007,and started bringing in my ownteam. I recruited a chief lending of-ficer and a chief credit officer fromComerica, and they began goingthrough the portfolio. After twomonths, we know we had prob-lems. Right about then, our firstdeveloper just stopped paying us.

You left in March 2010 to join Blue-water. By then, you’d been workingfor many months with regulators onPeople’s troubles. They must not haveheld you to account for what was go-ing wrong there, because they invitedyou to join the bid process for Citi-zens.

Tierney: Without the blessing ofregulators, we wouldn’t have beenable to do Bluewater. We went toNew York and hit every private eq-uity firm in town. We raised $240million and were able to make abid for Citizens, but we lost out toFirst Michigan. And then we weregoing to make a bid on anotherbank when I met Joe and joinedFlagstar.

Tom Henderson: (313) 446-0337,[email protected]. Twitter:@tomhenderson2

For 170 years, Foley has made it our mission to find out exactly what our clients want and deliver it. So when our Detroit clients asked for local access to the strength of a national law firm, Foley recruited the city’s top talent to establish our Detroit office and provide trusted local advisors who could leverage our national resources. It’s one more reason Foley received a top five ranking nationally for delivering exceptional client service in a recent survey of Fortune 1000 corporate counsel.

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Chase, Comerica deposit market shares rise; BOA’s falls


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sociates, speaking on behalf of thedevelopers, Invest Detroit, MidtownDetroit Inc. and The Roxbury Group.

Ground-floor tenants includeCenter City Properties, the manage-ment company for the property;Royal Oak-based GoCycle Studios;Hugh, a housewares and personalaccessories store; Nora, a design-oriented lifestyle store; SourceBooksellers; and Top Soil, a vegetari-an restaurant.

Developers last week openedleasing for 54 one-bedroom apart-ments and four studio apartments,which will be ready for move-in byNov. 1, as part of the 56,000-square-foot building. Prices range from$920 to $995 for the one-bedroomunits and from $780 to $830 for thestudios.

The Auburn, at Cass Avenueand Canfield Street, also includesa 97-space, gated parking court-yard behind the residential and re-tail building.

— Sherri Welch

3 Southeast Michigan hospitalshonored for quality of heart care

Three hospitals in SoutheastMichigan have been selected forTruven Health Analytics’ 50 Top Car-diovascular Hospitals for 2012.

They are Providence Hospital andMedical Center, Southfield; St.Joseph Mercy Oakland, Pontiac; andSt. Joseph Hospital, Ann Arbor.

Providence Hospital is owned byWarren-based St. John ProvidenceHealth System. St. Joseph MercyOakland and St. Joseph Hospitalare part of Ann Arbor-based St.Joseph Mercy Health System and Trin-ity Health in Novi.

The hospitals are recognized forlower rates of mortality and com-plications and higher quality thancomparable hospitals. The surveypreviously was conducted by Thom-son Reuters, which was acquired byTruven in July.

Patients in the study were diag-nosed with heart failure and heartattacks and received coronary by-pass surgery or percutaneous car-diovascular interventions (PCI),including angioplasties.

— Jay Greene

UM project aims to boostadvanced materials design

A $12.3 million project led by aUniversity of Michigan professoraims to boost the design of ad-vanced materials.

UM announced the effort, led byJohn Allison, a professor of mate-rials science and engineering, lastweek.

The project is funded by an $11 million, five-year grant fromthe U.S. Department of Energy and$1.3 million from the university. Itaims to cut the time it takes to de-velop such materials.

The grants establish a DoESoftware Innovation Centercalled the Predictive IntegratedStructural Materials Science Center,or PRISMS.

The federal funding comes fromthe Materials Genome Initiative,which aims to speed up the waysscientists and engineers discover,develop and manufacture new ma-terials.

— The Associated Press

Retail tenants nearly fill groundfloor of Midtown development

Developers of The Auburn, a$12 million mixed-use develop-ment in Detroit’s Midtown neigh-borhood, said last week they hadnearly filled retail space on the

building’s ground floor with theaddition of five retailers and arestaurant.

A second restaurant is planned,but the lease has not yet been final-ized for that 800 square feet ofspace, said Peter VanDyke, vicepresident of Berg Muirhead and As-

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How can peoplewho never went to

medical schoolfind a cure for cancer?

A Not-for-Profi t Provider

Behind the innovation and lifesaving research, the renowned cancer doctors, and the leading-edge technology at Beaumont are some very special people.

Community and business leaders who inspire us by their very commitment to us. By their energy and their generosity. By their desire to help people they’ll never meet.

Their gifts have allowed Beaumont to become a national leader in the early detection and accelerated treatment of breast, lung and prostate cancers. To fund research that enables us to predict a patient’s risk for cancer based upon genetics. And to offer every patient the very best chance to beat cancer, which means more hope than ever before.

Most of all, these people prove that it doesn’t take a medical degree to fight cancer.

All it takes is a heart.

Find out how you can save lives, too. If you wouldlike to make a gift, please go to our website atfoundation.beaumont.edu or click on the codewith your phone.

Amber K. and David B. Flint Breast and

Prostate Cancer Research Fund

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Research and Program Support Fund Rose Assarian Radiation

Oncology Waiting Room

Rose Family Adaptive Oncology Imaging Suite

The Cunnington FamilyComprehensive Lung Cancer Center

Coleman and Shirley Mopper

Pancreatic Cancer Fund

Walter and Marilyn Wolpin Comprehensive Breast Care CenterBY CHAD HALCOM


Wayne State University is at a record level ofresearch funding for various programsthrough the National Institutes of Health — butthat could be in jeopardy if a 10-year con-tract to fund the Perinatology ResearchBranch at Hutzel Women’s Hospital is not re-newed by Oct. 31.

Wayne’s largest single NIH-funded pro-gram is the perinatology program, staffed byWayne State physicians at Hutzel in the De-troit Medical Center and funded under a $167million contract that began in 2002 but laps-es at the end of this month.

The Perinatology Research Branch con-tract supports more than 120 jobs at theDMC.

Nearly all the NIH-funded Wayne Stateprograms, such as perinatology, are throughthe School of Medicine.

In the federal government’s fiscal year,which ended Sept. 30, Wayne State receivednearly 200 awards totaling $64.9 million forresearch grants, training grants and fellow-ships, according to NIH program data. The2012 NIH data do not yet include the catego-ry of research and development contracts,which officials said the agency is still com-piling.

However, the Web database USAspend-ing.gov, maintained by the federal Office ofManagement and Budget, reports 21 separateR&D contract and delivery order awards toWayne State during fiscal 2012 — for anoverall funding total of more than $88.5 mil-lion in 218 awards.

That’s up from $76.6 million in fiscal 2011and just under $80 million in total funding in2010 across all spending categories. In fact,it’s more than any of the past 20 budgetyears, according to NIH data. The previoushigh was $88.2 million in fiscal 2003.

The perinatology branch alone accountedfor $16.2 million of the $23.6 million R&Dcontracting total for the past year, accordingto the university and federal data.

It conducts clinical and basic research inperinatology medicine and related fields todevelop diagnostic and preventive tools tohelp reduce premature delivery, infant mor-tality and birth defects.

The Eunice Kennedy Shriver National Instituteof Child Health & Human Development solicitedbids for a new perinatology research con-tract in June and expects to reach a decisionby Nov. 1, said Bob Bock, press officer at theinstitute.

Wayne State, which has maintained thecontract funding for perinatology for 20years, applied for the new contract Aug. 8and is awaiting word from the NIH on or be-fore Nov. 1. Previously, the federal agencyhas passed over such competitors as Yale Uni-versity, the University of Pittsburgh and the Uni-versity of Miami to fund the program atHutzel, and the new contract has receivedother bidders, according to federal contractdata.

Matt Lockwood, director of communica-tions for Wayne State, said the universitywill not discuss the Perinatology ResearchBranch program while the application re-view is pending.

Silvia Zoma, a public relations managerfor Hutzel at DMC, also said the companymanagement would not comment on perina-tology funding.

Well-respected research programs withina hospital system can contribute to its valuefor prospective buyers, since a portion offunding for most research programs is setaside for overhead costs that can contributeto the hospital’s profitability, said Tony Co-larossi, partner for health care consulting at

Plante Moran Financial Advisors in Southfield.DMC was purchased by Nashville for-

profit health giant Vanguard Health SystemsInc. in a 2010 transactionvalued at nearly $1.5 bil-lion, including $365 mil-lion cash. Colarossi wouldnot discuss the DMC’s val-uation but said as a gener-al rule, grant- and con-tract-funded researchprograms contribute to ahospital’s value — somemore so than others.

“For research, it comesdown more to whether the research con-tributes to the core mission. If so, that canhave a low contribution to value,” he said.“It’s very possible that the hospital as a wholefunds research in terms of its cost, as opposedto the other way around, so it’s not necessari-ly a profit center. But sometimes for-profitcorporations are spun off from other kinds ofresearch (such as commercialized technolo-gy) that then go back into the investment port-folio. That can be more of a value contribu-tor.”

Perinatology would likely be a more mis-sion-focused research program for Hutzel,since it helps train future physicians andscientists and helps Wayne State offer moth-ers and their children in Southeast Michi-gan cutting-edge patient care.

Behind the perinatology program at WayneState, the second largest is the SEER (Surveil-lance, Epidemiology and End Results) pro-gram funded by the National Cancer Institute,also an NIH agency, at about $4.6 million peryear.

That program dates back to 1973, said AnnSchwartz, professor of oncology at the uni-versity’s School of Medicine and a deputy di-rector and executive vice president for re-search and academic affairs at the KarmanosCancer Institute, and administrator of theSEER grant program.

“But we do have other contracts andgrants with NIH,” she said. “There are alsotimes the NIH changes the mechanism un-der which this program is funded. Theyhave changed the method used, although thefunding and the purpose of it are pretty con-sistent over time.”

Chad Halcom: (313) 446-6796,[email protected]. Twitter: @chadhalcom

Wayne State looks to renew NIH funds for perinatology program

NIH FUNDING TO WAYNE STATEFunding awarded by the National Institutesof Health to Wayne State University is nowat more than a 15-year high. The fiscal yearended Sept. 30.

R&D Total NIHAwards contracts funding

1997 225 $7.96M $51.93M 1998 232 $6.76M $51.03M1999 250 $5.61M $53.4M 2000 249 $8.05M $61.82M 2001 263 $64.06M $65.48M 2002 269 $0 $66.97M 2003 261 $71.84M $88.25M 2004 239 $17.32M $87.58M 2005 234 $68.54M $76.92M2006 215 $4.89M $68.99M2007 206 $18.26M $81.35M 2008 197 $12.2M $73.73M2009 174 $54.91M $66.82M 2010 179 $56.85M $79.98M 2011 194 $11.56M $76.6M 2012 218 $23.63M $64.92M*

* Based on incomplete NIH tabulation. Including R&Dcontract obligations, figures from USAspending.govputs the total at $88,553,459.Source: NIH.gov

Colarossi



Editor:Although I agree with Keith

Crain’s column (“Now it’s time tosell the bridge, Matty,” Oct. 1) thatit’s time for the polarizing figure ofMatty Moroun to leave the bridgebattle and possibly focus on his, andour, greatest eyesore, the train sta-tion, I’d like to suggest we considerthe Moroun contribution to ourcommunity as it compares to ourother prominent families in Detroit.

Could any of us possibly imag-ine if Mike Ilitch, Peter Karmanosor Dan Gilbert behaved like MattyMoroun? I’m not sure I’ll ever un-derstand how someone so fortu-nate could have so little regard forhelping others or for shaping hislasting legacy to be dramaticallydifferent to what it is now.

Matty will probably, and hope-fully, finally lose his bridge battle.The campaign of deceit is trans-parent enough for most anyonewho pays attention. It would justbe nice to envision the tens of mil-

lions he’s spent on misleading ads,paid stooges and politicians beingoffered instead as a bridge to helpshape our city’s future.

Ultimately, we would all havebeen so much better served, espe-cially Matty. I’m not sure how longit will take Moroun to finally re-shape his family’s legacy in ourtown, or if he will even want, or beable to.

Michael DoyleGrosse Pointe Farms

Biz has campaign work cut out for it

n Michigan, “ballotmania” clearly is more front-and-centerin terms of political advertising than the presidential raceitself.Political groups are doing their best to scare state voters into

voting yes (or no) on six ballot questions Nov. 6. Many of the pro-posals usurp traditional legislative approaches to lawmaking.

Unions are battling business groups on Proposals 1, 2 and 4(emergency manager law, collective bargaining guaranteesand forced unionization of home health care workers). Busi-ness and Gov. Rick Snyder are battling a wealthy monopoly onProposals 4 and 6 (the two-thirds majority vote requirement onlegislative tax proposals and the new international bridgecrossing), and battle lines are fuzzy on Proposal 3, whichwould more than double the amount of renewable energy thatutilities must offer to customers.

Crain’s will publish a complete “business guide” to theelection on Oct. 22. But in general, business groups are pro-moting this mantra: “Vote ‘Yes’ on Proposal 1, and ‘No’ on therest,” reserving dollars to defeat the labor-leaning proposals.

And though business groups are almost uniformly opposedto Proposal 6 and in favor of a second crossing, relentless ad-vertising from interests tied to the owner of the AmbassadorBridge are drowning those voices out.

Business won big in the “free speech” decision that has un-leashed the power of super PACs. So where is the money topromote a sensible investment in Michigan’s position as an in-ternational trade center?

When biz connects, it winsBuy local.That phrase has guided Michigan consumers to look for lo-

cally grown or produced food and other products. But whenbusinesses buy from one another, jobs can really grow.

That’s the theory behind one of Gov. Rick Snyder’s most ef-fective programs, Pure Michigan Business Connect.

Announced nearly 18 months ago, the project encouragesMichigan companies to increase the dollars spent with Michi-gan-based vendors and contractors.

As Jay Greene reports on Page 3, DTE Energy pledged to in-crease spending by $750 million through 2016. Its policy nowrequires at least two Michigan companies and two minorityvendors to be part of any bid process. DTE buys everythingfrom construction to maintenance services, staffing to technol-ogy consulting.

One Detroit company, Strategic Staffing Solutions, landeda third contract with DTE for customer service consulting,adding 100 new employees.

If more companies followed DTE’s lead, it could take a biteout of Michigan’s jobless rate.

Moroun’s actions taint legacy

The economy is lousy. The auto-mobile industry seems to be recov-ering, but Europe could drag theDetroit automakers down. Unem-ployment, despite Friday’s report,is still too high.

We’ve got a political mess inSoutheast Michigan that doesn’tlook like it will be solved any timesoon.

But our baseball team is in theplayoffs, and that’s a wonderfulthing.

This was written before theweekend games. I couldn’t predicttheir outcomes, much less what

lies ahead for theTigers.

But we had an excit-ing finish to the season,and we’re battling tostay in the playoffs foras long as possible.

We’d all love to seeour Tigers head for theWorld Series, but thereare a lot of mountains toclimb before that hap-pens.

Yet the excitement for our cityand the entire state is unmatched.Especially since we’ll be lucky to

see the Red Wings playat all this season —hockey is in its fourthlabor dispute since1990. And the Lionshaven’t exactly beenproducing the resultsthat we had hoped forwhen the football sea-son began. It’s too earlyto think about the Pis-tons, and even our col-lege teams seem to be

struggling this year.So let’s celebrate the Tigers — a

team led by Miguel Cabrera, who

could win just about every awardthis year; Prince Fielder, who’s fol-lowing in his father’s footsteps inDetroit; and our much-loved pitch-ers, starting with Justin Verlander.

The Tigers have given this cityplenty to cheer about. It’s great formorale as well as the economy. Alot of money will be spent down-town as long as we’re in the race,which everybody hopes will goright into the World Series.

Our town, in spite of all its prob-lems, is blessed with a great selec-tion of professional and collegesports teams. This is a great eco-

nomic draw for development, justlike advanced education and cul-ture. It gives our city a great ap-peal for economic development.

I can only hope that we do wellin our baseball playoffs. The cityneeds a boost, and there is nodoubt that the Tigers can supplythe excitement we need right now.

There are a lot of dollars-and-cents reasons to hope that ourbaseball team does well, but themost important reason is thatwe’re all fans. We want to see ourteam do well.

Go, Tigers!

Crain’s Detroit Businesswelcomes letters to the editor.All letters will be considered forpublication, provided they aresigned and do not defameindividuals or organizations.Letters may be edited for lengthand clarity.Write: Editor, Crain’s DetroitBusiness, 1155 Gratiot Ave.,Detroit, MI 48207-2997.Email: [email protected]

Detroit needs a winner; Tigers step up

I

From www.crainsdetroit.com

LETTERS

OPINION

KEITH CRAIN:

TALK ON THEWEB

Re: Gunfire in Detroit parkI am relieved that no one was

hurt. Welcome to the “D,” littlebrother. Eventually it will berolling off your back and you willbe cracking jokes, too. Detroit islike a rose. And like every rose, ithas thorns. The sad thing is thatwhile that was happening, themedia were instigating a lynchmob over who the police chief isdating and sending him home tonot do his job. Can anyone focuson what’s important for just afew minutes, please?

Niki Brown

Re: Red Wings arena still in plansBuild the new arena at the old

corner. I think it would be great tosee a modern arena with refer-ence to the history of Tiger Stadi-

See Letters, Page 9



ter significantly trailingthe U.S. from 2002through 2009, Michigan’scombination of job and in-come has exceeded U.S.growth for the past eightquarters. The state hasnot witnessed that advan-tage versus the U.S. sincethe mid-1990s.

� The performance ofMichigan’s corporate

headquartered, high-yield bondmarket has exceeded the nationalindexes. The high-yield bond mar-ket is a gauge of economic sensitiv-ity and often leads even the stockmarket as a barometer of future

business conditions. Companiessuch as Lear, Pulte, Masco andCMS Energy, to name a few, arerated below investment grade orhigh yield by the credit ratingagencies. A portfolio of 14 Michi-gan corporate high-yield bondshad a total return (yield and priceappreciation) of 8.5 percent in thefirst half of 2012, compared to a 7percent return for the MerrillLynch U.S. High Yield Bond index.

The favorable performance forMichigan’s high yield corporatebonds in 2012 has prevailed nowfor the past three years. The sameportfolio of Michigan’s high-yieldcorporate bonds has returned 69

percent, compared to a 56.4 percentreturn for the U.S. Merrill LynchHigh Yield index, for the three-year period ending June 30, 2012.

� Michigan’s corporate rank-ing in the most recent Barron’stop 500 publicly traded companies— based on corporate cash flowreturn on investment and rev-enue growth — has meaningfullyimproved in the past three years.In the May 2012 Barron’s top 500U.S. companies, 16 Michigan pub-licly traded companies made thelist, a comparable number fromtheir annual rankings in 2008 and2009. However, the rank of Michi-gan companies has improved sig-

nificantly, rising from an averageof 382 in 2008 to 251 in 2012. In-deed, Borg Warner, one of themost profitable auto companies,was ranked 19th in 2012 — thefirst time a Michigan companyhas cracked the top 25 since thesurvey began.

These three diverse measuresfurther confirm the more recentimprovement in Michigan’s busi-ness conditions and, importantly,suggest the longer-term prospectsfor Michigan to compete havemeaningfully increased.

David Sowerby is portfolio man-ager in the Bloomfield Hills office ofLoomis Sayles & Co. LP.

More evidence is sup-porting the case thatMichigan business condi-tions are growing fasterthan the national aver-ages. What is perhapsmost encouraging is theargument that the fastergrowth is not simply amediocre rebound fromthe depressed levels of theGreat Recession, butrather stems from structural im-provements that should help en-hance the opportunity for Michi-gan to compete in the long run.

Three critical data measure-ments reinforce the improvedbusiness conditions. They are:

� Michigan vs. U.S. prosperitygrowth: I define prosperity as sim-ply the combination of job growthplus personal income growth. Af-

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3 more signs show state biz is recovering

TALK CONTINUED■ From Page 8

um by incorporating the existingfence and flag pole.

BrandonP

Re: Other Voices: Cut city income taxTaxes don’t determine where young

talent lives. Services do. If you canshow you can cut taxes and im-prove mass transit, cut the grassin city parks, have better policeand fire protection, put on publicconcerts, keep museums and zoosopen and flourishing, etc., withlower taxes, then by all means. Butso far, cutting state taxes hasmeant cutting state support forcities, and the result seems to bethat we have to cut services.Young talent moves to high-costand -tax Chicago, Minneapolis,New York far more often thanJackson, Miss., a low-tax locationthat should be winning the war fortalent if that’s what matters. Itdoesn’t.

MWAC

Re: Impact of Duggan-Bing race on biz Bing will not run for re-election.

His experience as mayor has beenhis version of hell on earth. TomBarrow and Hansen Clarke willrun. As of today, Benny Napoleon,Clarke or Barrow would getthrough the primary to the gener-al. As would/will Mike Duggan.Duggan would be the presumed fa-vorite based on funding, brains,organizational skills and tenacity.But the result would be uncertain.

Curtis Blessing

Re: Keith Crain on selling the bridge All of us have wondered how

much money one man needs ... andhow much damage can one man doto a neighborhood or a city by sucha divisive campaign. Time to go dosomething else. Thanks for sayingwhat so many of us have beenthinking.

Keith

It is about time that someone inthis town convinces Matty it istime to move forward. Matty isworth millions. He should help thecitizens of Michigan and throw hismoney at the city of Detroit.

Denny Zimmer

OTHER VOICES:

David Sowerby

20121008-NEWS--0009-NAT-CCI-CD_-- 10/5/2012 10:42 AM Page 1

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CALENDARTUESDAY

O C T . 9

DEC Luncheon. 11:30 a.m.-1:30 p.m. De-troit Economic Club. With JohnZogby, managing director, JZ Analyt-ics. Detroit Athletic Club, Detroit. $75nonmembers, ticket discounts avail-able for DEC members. Contact: Mag-gie Sisco, (248) 626-0006; email:[email protected]; web-site: www.econclub.org.

Marketing Roundtable — The Innova-tor’s Dilemma. 5-7 p.m. Ann ArborSpark. With Diane Durance, GreatLakes Entrepreneur’s Quest. SparkCentral, Ann Arbor. Free. Contact:(734) 761-9317; website: www.annarborusa.org.

WEDNESDAYO C T . 1 0

Coffee & Capital. 8-9 a.m. TechTown.Casual discussion on microloansavailable to Detroit retailers. Café conLeche, Detroit. Free. Contact: DianeLove-Suvada, (313) 483-1302; email: [email protected]; website:www.techtowndetroit.org.

5 Keys to Achieving Fiscal Fitness. 9a.m.-noon. Michigan Small Business& Technology Development Center,Macomb County Department of Plan-ning & Economic Development. Veloc-ity, Sterling Heights. $25. Contact:Jamie Judson, (586) 469-5118; email:[email protected]; web-site: www.misbtdc.net.

Community Leadership Luncheon. 11a.m.-1:30 p.m. Birmingham Bloom-

field Chamber. Discover opportuni-ties to partner with nonprofits andmake a difference in the community.With Mark Hollis, Michigan State Uni-versity athletic director, and TonyMichaels, president and CEO, The Pa-rade Co. Moderated by Jackie Paige,WJBK-TV2. Radisson Hotel, Bloom-field Hills. $40. Contact: AndreaKaczmarek, (248) 644-1700, ext. 24;email: [email protected]; website:www.bbcc.com.

Export Opportunities for Women En-trepreneurs. 9-11 a.m. Michigan Asso-ciation for Female Entrepreneurs.Learn about government agencies andservices that can help a company en-ter global export markets and expand

its global presence. Michigan FirstCredit Union, Lathrup Village. $35.Contact: Tonya McNeal-Weary, (866)490-6233; email: [email protected];website: www.mafedetroit.org.

THURSDAYO C T . 1 1

Veterans Doing Business with theState. 2-4 p.m. Michigan Departmentof Technology, Management & Bud-get, VetBizCentral. Business-ownerveterans can learn the elements need-ed for a quality proposal to do busi-ness with the state of Michigan. Con-stitution Hall, Lansing. Free. Contact:Jenni Riehle, (517) 335-6633; e-mail:[email protected]; website:Michigan.gov/micontractconnect.

APACC Salute to Excellence Award Din-ner. 5:30-9 p.m. Asian Pacific AmericanChamber of Commerce. With Tony Tom-czak, director of supply chain manage-ment, DTE Energy. Celebrate success-ful Asian business professionals andAsian-owned companies. The Henry,Dearborn. $60 APACC and strategicpartner level-one members or $450table of eight; $75 nonmembers or $600table of eight. Contact: Sarah Lalone,(248) 844-4100; email: [email protected];website: www.apacc.net.

FRIDAYO C T . 1 2

Become a Boardroom Insider. 7:30-11:30 a.m. Inforum. With Lisa Pick,principal, Miller, Canfield, Paddockand Stone PLC; and Laurene Horiszny,chief compliance officer, BorgWarnerInc. Miller Canfield, Troy. $125

member, $175 nonmember, $100board-ready participants. Contact:(313) 578-3846; email: cthompson@inforummichigan; website:www.inforummichigan.org.

Business Breakfast. 8-9:30 a.m. Livo-nia Chamber and Greater FarmingtonArea Chamber of Commerce. WithMichigan Economic DevelopmentCorp. President and CEO Mike Finneyaddressing Michigan’s economicprogress and the success of the PureMichigan campaign. FarmingtonHills Manor, Farmington Hills. $20member, $30 nonmember. Contact:Laura Sweeney, (734) 427-2122; email:[email protected]; website:www.livonia.org.

SATURDAYO C T . 1 3

New Venture for Veterans. 8:30 a.m.-noon. Michigan Small Business &Technology Development Center,Eastern Michigan University, VetBiz-Central. Program targets aspiringand early-stage entrepreneursthrough a 10-week business develop-ment class featuring the New Venturecurriculum. EMU Livonia campus.Free to U.S. veterans. Contact: PaulNucci, (734) 487-0902; email:[email protected]; website: www.vetbizcentral.org.

COMING EVENTSDetroit Economic Club Luncheon.11:30 a.m.-1:30 p.m. Oct. 15. DetroitEconomic Club. With former Gov.John Engler. Westin Book Cadillac,Detroit. $55 guests of members, $75nonmembers. Ticket discounts avail-

able for DEC members. Website:www.econclub.org.

Successful Marketing via Facebook.11:30 a.m.-1:30 p.m. Oct. 18. Inforum.With Carolyn Everson, Facebook’s vice

president of glob-al marketing solu-tions, and ScottMonty, head ofglobal social me-dia, Ford MotorCo. Cobo CenterRiverview Ball-room, Detroit. $50Inforum mem-bers, $70 non-members. Con-tact: (877)633-3500; website:

www.inforummichigan.org.

The Art of Wine. Vintner’s private re-ception 6-7:30 p.m., silent auction re-ception 6:30-8 p.m., gala dinner andauction, 8-10:30 p.m. Oct. 20. GeneralMotors Co., Cadillac division. Wines,automobiles and art converge in anevent benefiting the College for Cre-ative Studies. GM Design Center.$5,000 benefactor level includes admis-sion for two to all events; $1,500 pa-tron, single admission to all; $500 sup-porter, single admission to dinner,auction. Contact: (313) 664-7464; email:[email protected];website: www.collegeforcreativestud-ies.edu/diwa.

Driving Real Estate. 11 a.m.-1:30 p.m.Oct. 19. Commercial Real EstateWomen. With Donna Inch, chairmanand CEO, Ford Motor Land Develop-ment Corp. Dearborn Inn, Dearborn.$45 CREW member, $65 nonmember.Register by Oct. 16 at crewdetroit.org.

CRAIN’S PAYS TRIBUTETO 40 UNDER 40Join Crain’s Detroit Business incelebrating the accomplishmentsof 40 of Southeast Michigan’sbrightest stars younger than 40,5:30-9 p.m. Oct. 24 at ShrinersSilver Garden Event Center,Southfield. The winners of Crain’s40 Under 40 were highlighted in theOct. 1-7 issue of Crain’s DetroitBusiness and atwww.crainsdetroit.com.Tickets are $40 for 40 Under 40alumni, $45 for guests in groups of10 or more, $50 for CDBsubscribers, $75 with a specialCDB subscription offer and $90 fornonsubscribers.For more information, call (313)446-0300 or visitwww.crainsdetroit.com/events.

Everson



Fletcher mademuch more thana dime’s worth of difference

This week, thousands of Michiganshoppers will lug bags or boxes ofreturnable cans and bottles to grocerystores to reclaim deposit money.

Michigan’s bottle law, which tookeffect in 1978, was a citizenreferendum. A powerful lobby of softdrink and beer makers anddistributors blocked legislation, soconservationists gathered 400,000petition signatures and asked votersin 1976 to approve it. The firstsignature was that of Gov. WilliamMilliken — who had, in 1973,appointed Ypsilanti’s Peter Fletcher tothe highway board.

By 1975, he chaired thecommission, which endorsed thebottle bill. Fletcher became a leadingadvocate of the drive, telling StrohBrewery Co. Chairman Peter Stroh in apublic meeting, “Nothing is morefrustrating to this department thanhaving to go out and clean up afteryour industry.”

Fletcher, who died late last monthin his beloved hometown of Ypsilanti,was proud of his support for that bill.

“I’m just a broken-down billcollector from Ypsilanti, Michigan,” hewould say by way of introduction. Thebill collector part was right; he ownedthe Credit Bureau of Ypsilanti. The“vanity” license plate on his Cadillacread: PAY NOW.

“He was one of those renaissanceguys who knew history and languageand cared a lot about both. He wasalways polite, but devastating in hissallies,” said longtime friend MaryLukens, who knew Fletcher for 40years.

Many accolades have been paid forhis political acumen as an adviser tofour Michigan Republican governors.And remembered, too, was his role inprinting a “special” edition ofMichigan’s official, foldable mapsthat listed two tiny Ohio towns nearthe Michigan border: Goblu andBeatosu.

He was generous — alwaysprivately — to people and causes hebelieved in. He mentored many youngpeople in their political careers. Andhe had an ethical core that couldspot a phony — or a crook — a mileaway.

Which made him the perfect choiceto chair the audit committee at theBank of Ann Arbor, the bank createdin 1996 by three Ann Arborluminaries: Bill Martin, the latepolitical pollster Bob Teeter andBorders Books co-founder TomBorders. Fletcher was a director ofthe bank from 1996 until he went toemeritus status this year.

The best phrase I can summon isone I heard him speak on rareoccasions. Peter was truly suigeneris, one of a kind.


PUBLISHER’S NOTEBOOK

Mary Kramer

Contact MaryKramer atmkramer

@crain.com.

Great Lakes neighborsbet on wet

BY ROD KACKLEY

SPECIAL TO CRAIN’S MICHIGAN BUSINESS

ichigan’s more than 3,000miles of Great Lakes shore-line — combined with all

of its rivers, streams and inlandlakes — hold the potential towash the rust off the state.

In neighboring Wisconsin andOntario, that potential is startingto be realized for this “blue econ-omy,” where water is the fuel foreconomic development.

For now, Michigan trails both. Leading the initial efforts in

the state are Muskegon Countyon the west side and MacombCounty on the east — withoutmuch help from Washington orLansing and relatively little coor-dination between the counties,which are separated by a three-hour trip on I-96.

“However, by raising the levelof what we are doing, we arehoping the state agencies as wellas the coordinating federal agen-cies will start to take notice,”said Gerry Santoro, program

manager at the Macomb County De-partment of Planning & Economic De-velopment.

Both Santoro and Cindy Lar-

son, president of the MuskegonLakeshore Chamber of Commerce,hope to realize the promise ofwhat a 2012 Brookings Institutionreport on the Great Lakes de-scribed as a “$500 billion-and-growing global water technologybusiness sector.”

This new economic model in-cludes everything from the con-troversial notion of selling waterto thirsty states and even over-seas, to repairing aging water andsewer systems, to finding newsources of energy in the water

Michigan wades in to catch‘blue economy’ wave

PHOTO: MARGE BEAVER

COURTESY OF GRAND VALLEY STATE UNIVERSITYGrand Valley State’s Annis WaterResources Institute is one of eightuniversity-based water research facilitiesin Michigan.

M

See Wave, Page 12

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Muskegon’sdeep-waterchannel andharbor (topphoto and atleft) off LakeMichigan canaccommodateoceangoingfreighters.


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and algae of lakes and rivers, tobuilding new tourism and recre-ation centers — along with the re-search needed to tap these revenuestreams.

While Macomb County’s effortsfocus on recreation and tourism,Muskegon offers, among otherthings, the only major commercialport on the eastside of LakeMichigan.

No one is pre-dicting howmany jobs theblue economycould create, be-cause it is still sofractionalized.But it appearspoised to take ongreater impor-tance, given U.S.government pre-dictions that 36states could suf-fer water short-ages next year,following this year’s drought.

“Water scarcity is a huge driver,and it is not getting better,” saidChris Webb, co-director of the Engi-neering Society of Detroit. “Majorcompanies making semiconduc-tors in Spain, India and Asia arenow facing community competi-tion for potable water.”

Said Santoro: “The rest of thenation still refers to us as the RustBelt. But 10 years from now, whenthey have no water supply becausethey have built out so much thereis no water table left, who are theygoing to come crying to?”

On the east side of the state, theMichigan Economic DevelopmentCorp. is involved in developing wa-ter technologies, pumping $4 mil-lion each into a project in Flint todevelop biogas from municipalwastewater and another project inAlpena that involves the biorefin-ery conversion of industrial waste-water from a hardwood processingplant into ethanol and other chemi-cals that can be reused.

An additional $1 million inMEDC money has gone to H2Oppor-tunities in Oakland County. Anoth-er key facilitator in the state is Sus-tainable Water Works, a watertechnology incubator in WayneState University’s TechTown.

But the MEDC’s director of wa-ter technologies, Gil Pezza, admitsthat “many technologies neverreach the market (in Michigan) forlack of financing for demonstra-tion projects.”

In Ontario, in contrast, theprovincial government has invest-ed more than $49 million in morethan 100 water-related projectsover the past several years. Theprovince claims more than 900businesses and 22,000 employeesin its water industry.

Ontario also has invested $8.9million in four projects, includingone involving new water treat-ment technologies that are less ex-pensive and time-consuming thancurrent cleanup procedures.

And the Wisconsin Economic De-velopment Corp. has committed$750,000 over three years to helpstartups pay their rent in the Mil-waukee Water Council’s Water Tech-nology Research and Business Accel-

erator, scheduled to open alongLake Michigan in early 2013.

Milwaukee economic developerssaw the opportunity several yearsago, said Dean Amhaus, executivedirector of the water council.

Milwaukee, Amhaus said, hadtwo things going for it: lots of heavymanufacturing and plenty of com-

panies makingbeer. That meantthey already hadmanufacturersmaking the me-ters, valves anddevices that arepart of the water-related indus-tries.

Along withheavy manufac-turers came pol-lution, so anoth-er industry wasspawned to “helpthose companiesclean up theiract,” he said.

“It is only in the last six yearsthat we turned the picture 90 de-grees and saw it differently,”Amhaus said. “We saw that therewas a connection between thesecompanies, all around water.”

The Milwaukee Water Councilhas blended that private-sectorcommitment with the Great LakesWater Institute — the largest fresh-water research institute on theGreat Lakes. It includes the Univer-sity of Wisconsin-Milwaukee Schoolof Freshwater Sciences

Ontario’s minister of economicdevelopment and innovation, BradDuguid, said the move toward ablue economy in his province fol-lowed a similar path.

“Over the course of time, we haddeveloped a great deal of domesticexpertise on clean-water technolo-gy,” Duguid said. “So we took thatstrength, recognized that this is a$400 billion global technology mar-ket and decided that Ontario need-ed to be a player.”

Is the strategy to launch busi-nesses, grow second-stage compa-nies or attract businesses fromoutside Ontario?

“It is all of the above,” Duguidsaid.

The MEDC’s Pezza said hisagency is working “directly andindirectly with numerous compa-nies” including Miya, an Israeli-based company that recentlyopened an office in Michiganthrough its Canadian company,Veritec.

Washington’s responseDemocratic Sen. Carl Levin and

his Republican colleague from Illi-nois, Mark Kirk, cited the impor-tance of the Great Lakes to the re-gion’s economy when, just beforeCongress recessed for the Novem-ber elections, they introduced legis-lation that would formally autho-rize the Great Lakes RestorationInitiative, which includes a federalinter-agency program designed toaddress the most significant prob-lems in the Great Lakes ecosystem,

The bill also would reauthorizethe Great Lakes Legacy program,which supports the removal of

Wave: Betting on wet■ From Page 11

See Next Page

We ... recognizedthat this is a $400

billion globaltechnology marketand decided that

Ontario needed to bea player.

Brad Duguid, Ontario minister ofeconomic development and innovation

”

“

20121008-NEWS--0012,0013-NAT-CCI-CD_-- 10/5/2012 10:35 AM Page 1

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contaminated sediments, and theGreat Lakes National Program Office,which handles Great Lakes mat-ters for the U.S. Environmental Pro-tection Agency.

Macomb and Muskegon countyofficials are pushing forward —with or without Lansing and Wash-ington.

Muskegon officials are focusingefforts on Lake Michigan andMuskegon Lake research, in addi-tion to recruiting manufacturersthat depend on a ready source ofclean water. Food processing is atthe top of that list, but every manu-facturer depends on clean water.

“Classic auto assembly plantsuse the equivalent of two DetroitZoo water towers or over 2 milliongallons of water each day,” saidthe Engineering Society’s Webb.

Because so many manufacturersneed so much water, Webb thinksthey are going to be drawn toMichigan.

“Water,” he said, “is the next oil.”Over in Muskegon, Larsen said,

“We have started to rebrand ourcommunity so that every time youhear the name ‘Muskegon,’ youwill associate it with water.”

They are also looking at erecting

wind turbine farms on Lake Michiganas well as doing more to publicizeMuskegon’s deep-water port, whichcan handle oceangoing vessels.

Another facet of MuskegonCounty’s blue economy effort is theGrand Valley State University Annis Wa-ter Resources Institute. It is involvedin a number of research programs,including the possible use of algaeto create biofuels. The institute isone of eight university-based waterresearch facilities in Michigan.

In Macomb County, Santoro isfocused on enhancing recreation,tourism and all the business op-portunities that are part of Ma-comb’s blue economy initiative.His team works with the govern-ments of six communities that areon the main branch of the ClintonRiver — Sterling Heights; Shelby,Clinton and Harrison townships;Mt. Clemens; and Utica — to cleandebris out of the main branch ofthe Clinton River.

“We want to open up the rivercompletely for recreational pad-dleboarding, one of the fastest-growing recreational sports in theU.S.,” Santoro said. “Our local out-fitters can’t keep kayaks andstand-up paddleboards in stock.”

Utica officials have put in a riv-

er walk and boat launch in HeritagePark. Several more boat launchescould be opened soon in that cityand Sterling Heights, Santoro said.

He also said Mt. Clemens offi-cials are reopening the old down-town boathouse at the city’s publicmarina and could contract with acanoe livery for day trips out of thecity’s downtown district.

New Baltimore, with its twopublic beaches along Lake St.Clair and historic downtown dis-trict, could see the addition of artgalleries, specialty shops, bed-and-breakfasts or small hotels, alongwith a marina now under con-struction.

Santoro’s team is also lookingat creating a walkable marina dis-trict — “maybe not on the scale ofNavy Pier, but something of signifi-cance where there could be otherrecreational activities, restau-rants, maybe a small museum oran aquarium,” he said. “We arealso looking to land a major hotelon the shoreline of Lake St.Clair.”

In addition, Macomb CommunityCollege and Wayne State Universityhave been talking about creating aresearch laboratory and educationcenter on Lake St. Clair. The cen-

ter remains in exploratory talks asthe two schools and MacombCounty clarify its function.

Macomb County ExecutiveMark Hackel has said he envisionsthe center as part of a regional eco-nomic development strategy forLake St. Clair.

Movement in MichiganJohn Austin, a member of the

Michigan State Board of Educationand a co-author of a Brookings In-stitution study of the Great Lakesregion, said even more could be ac-complished with an increase instate government support. Lastmonth, Austin was appointed tohead the new Michigan EconomicCenter, part of the nonprofit PrimaCivitas Foundation, an economic de-velopment organization with tiesto Michigan State University.

He is working to form astatewide coalition to prompt theSnyder administration “to see theblue economy opportunity and putsome additional energy into sup-port for communities that are try-ing to grow their blue economyfootprint.”

Austin thinks Michigan has tofind communities such as Mus-

kegon and Macomb counties, Tra-verse City and Detroit, all with sig-nificant waterfronts, and then“clean up the water and the water-fronts. Redevelop them and con-serve them.”

“This is expensive work,” Austinsaid. “Local communities usuallycan’t do it alone. It helps to havesome sources of state and federalinfrastructure support.”

While public sector support hasbeen important to Ontario’s effortto foster more water-centric inno-vation, Duguid said, governmentofficials have not led the effort.That has been up to the private sec-tor, while the government is there“to stimulate growth in the sectorand provide some incentive.”

Duguid holds out the possibilityof partnering with Michigan tobring more water-technology-re-lated businesses to the GreatLakes region. History has shownthe benefits of that cross-borderpartnership, Duguid argued,pointing to the auto industry.

“It is almost like there is no bor-der between us, from a businessperspective,” he said. “I think theworld sees us as a cluster and one ofthe most desirable clusters for busi-ness, commerce and industry.”

From Previous Page

20121008-NEWS--0012,0013-NAT-CCI-CD_-- 10/5/2012 10:35 AM Page 2

CRAIN'S LIST: LARGEST MICHIGAN MANUFACTURERS Ranked by 2011 revenue

Rank

CompanyAddressPhone; website Top executive(s)

Revenue($000,000)2011/2010

Revenue %change

EmployeesJan. 2012Michigan/worldwide

Number of plantsin Michigan Michigan plant locations Clients/industries served

1.General Motors Co.300 Renaissance Center, Detroit 48265(313) 556-5000; www.gm.com

Daniel Akersonchairman and CEO

$150,300.0/$135,600.0

10.8% 39,943/209,000

14 Bay City, Detroit/Hamtramck, Grand Rapids,Lansing, Livonia, Milford, Orion, Pontiac,Romulus, Saginaw, Swartz Creek, Warren,Ypsilanti

Automotive

2.Ford Motor Co.1 American Road, Dearborn 48126(313) 322-3000; www.ford.com

Alan Mulallypresident and CEO

136,264.0/128,954.0

5.7 NA/224,000

14 Dearborn, Flat Rock, Wayne, Woodhaven,Romeo, Sterling Heights, Livonia

Automotive

3.Dow Chemical Co.2030 Dow Center, Midland 48674(989) 636-1000; www.dow.com

Andrew Liverispresident, chairman andCEO

59,985.0/53,674.0

11.8 6,080/52,246

2 Harbor Beach, Hillsdale Automotive, agriculture, home care,health care, construction

4.Chrysler Group LLC1000 Chrysler Drive, Auburn Hills 48326-2766(248) 576-5741; www.chryslergroupllc.com

Sergio Marchionnechairman and CEO

54,981.0/41,900.0

31.2 24,491/54,232

11 Detroit, Sterling Heights, Trenton, Warren Automotive

5.Johnson Controls - AutomotiveExperience49200 Halyard Drive, Plymouth 48170(734) 254-5000; www.johnsoncontrols.com

Beda Bolzeniuspresident, AutomotiveExperience

20,065.0/16,610.0

20.8 10,000/162,000

18 Battle Creek, Detroit, Grand Rapids,Highland Park, Holland, Lansing, Monroe,Port Huron, Romulus, Warren, Plymouth

Automakers

6.Whirlpool Corp.2000 North M-63, Benton Harbor 49022(269) 923-5000; whirlpool.com

Jeff Fettigchairman and CEO

18,666.0/18,366.0

1.6 NA/68,231

0 NA Household appliances

7.TRW Automotive Holdings Corp.12001 Tech Center Drive, Livonia 48150(734) 855-2600; www.trwauto.com

John Plantchairman, president andCEO

16,244.0/14,400.0

12.8 3,365/63,200

5 Fenton, Fowlerville, Portland, Saginaw,Sterling Heights

Automotive

8.Delphi Automotive plc5725 Delphi Drive, Troy 48098(248) 813-2000; www.delphi.com

Rodney O'Nealpresident and CEO

16,041.0/13,817.0

16.1 1,436/118,000

0 NA Automotive

9.Lear Corp.21557 Telegraph Road, Southfield 48033(248) 447-1500; www.lear.com

Matthew Simoncinipresident and CEO

14,156.5/11,954.6

18.4 3,149/97,830

9 Traverse City, Roscommon, Farwell, Mason,Rochester Hills, Detroit, Taylor, Brownstown

Automotive

10.Kellogg Co.1 Kellogg Square, Battle Creek 49016(269) 961-2000; www.kelloggcompany.com

John Bryantpresident and CEO

13,198.0/12,397.0

6.5 NA/30,700

3 Battle Creek, Grand Rapids, Wyoming Food products

11.Robert Bosch LLC38000 Hills Tech Drive, Farmington Hills 48331(248) 876-1000; www.boschusa.com

Werner Struthchairman

9,800.0/8,800.0

11.4 2,100/303,200

2 St. Joseph, Kentwood Automotive, industrial, consumer goods,building technology

12.Continental Automotive Systems USInc.1 Continental Drive, Auburn Hills 48326(248) 393-5300; www.conti-online.com

Samir SalmanCEO, Continental NorthAmerica

8,800.0 B/7,740.0 B

13.7 1,500/163,788

0 NA Automotive OEM

13.Stryker Corp.2825 Airview Blvd., Kalamazoo 49002(269) 385-2600; www.stryker.com

Kevin Lobopresident and CEO

8,307.0/7,320.0

13.5 2,247/21,000

2 Kalamazoo, Portage Health care

14.Visteon Corp.1 Village Center Drive, Van Buren Township48111(734) 710-5000; www.visteon.com

Timothy Leuliettepresident and CEO

8,047.0/7,466.0

7.8 1,100/27,000

1 Warren Automotive

15.Masco Corp.21001 Van Born Road, Taylor 48180(313) 274-7400; www.masco.com

Richard Manoogianchairman

7,467.0/7,486.0

-0.3 1,286/31,000

5 Ann Arbor, Adrian, Novi, Brownstown,Lapeer, Taylor

Home improvement, construction

16.BorgWarner Inc.3850 Hamlin Road, Auburn Hills 48326(248) 754-9200; www.borgwarner.com

Timothy Manganellochairman and CEO

7,114.7/5,652.8

25.9 900/19,250

2 Cadillac, Livonia Automotive

17.

Federal-Mogul Corp.26555 Northwestern Highway, Southfield 48033(248) 354-7700; www.federalmogul.com

Rainer Jueckstockco-CEO, Federal-Mogul andCEO, powertrain segmentMichael Broderickco-CEO, Federal-Mogul andCEO, vehicle componentssegment

6,910.0/6,219.0

11.1 1,530/45,000

2 Greenville, Sparta Automotive OEM and aftermarket

18.Dow Corning Corp.2200 W. Salzburg Road, Midland 48640(989) 496-4000; www.dowcorning.com

Robert Hansenpresident and CEO

6,430.0/6,000.0

7.2 4,000/12,000

5 Auburn, Freeland, Hemlock Semiconductor -Hemlock, Midland

Electronics, construction, automotive,energy, personal care

19.Denso International America Inc.24777 Denso Drive, Southfield 48033(248) 350-7500; www.densocorp-na.com

Hikaru "Howard" Sugipresident and CEO

6,200.0 B/6,090.0 B

1.8 NA/NA

1 Battle Creek Automotive

20.Guardian Industries Corp.2300 Harmon Road, Auburn Hills 48326-1714(248) 340-1800; www.guardian.com

Charles Croskeychairman

5,000.0 B/5,000.0 B

0.0 NA/18,000

2 Albion, Carleton Automotive, home, lighting, electronics,construction

This list of manufacturing companies is an approximate compilation of the largest such companies in Michigan. It is not a complete listing but the most comprehensive available. Crain's estimates are based on industry analysis and benchmarks, news reports and awide range of other sources. Unless otherwise noted, information was provided by the companies. Companies with headquarters elsewhere are listed with the address and top executive of their main Michigan office. Actual revenue figures may vary. NA = notavailable.B Crain's estimate.

LIST RESEARCHED BY BRIANNA REILLY


■ An expanded version of this list can be purchased at crainsdetroit.com/lists

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BY MATTHEW GRYCZAN


Downtown Grand Rapids seemsto have burst at the seams andspilled a few streets south, the re-sult, some say, of confidence thatan anchor project — the $30 millionDowntown Market — has brought toa neglected part of the city.

Crews working on the DowntownMarket — the name officially givento the project last month — and oth-er projects near the intersection ofWealthy Street and Division Av-enue Southwest almost trip overeach other as they scurry to closeup space before winter sets in.

The frenzy only promises to pickup more steam nearby as DwellingPlace plans to break ground thismonth on a $30 million package ofaffordable housing and office space,and Brookstone Capital LLC expectsto launch construction on threeapartment complexes carrying a to-tal price tag of $36 million.

“There was a time when GrandRapids didn’t include anythingsouth of Fulton Street. Now we areseven streets down, south ofWealthy Street,” said Dennis Sturte-vant, CEO of Dwelling Place, a non-profit community development cor-poration that owns and managesmore than 1,000 apartments andhomes in 21 housing communitiesthroughout West Michigan.

He said his organization willbreak ground this month on workthat includes renovation of apart-ments in the historic HerkimerHotel building and construction oftwo multistory buildings for of-fices and retail.

There wasn’t this sort of activityin the area a year ago — only plansthat had been in discussion foryears. That changed with demoli-tion of six neglected buildings tomake way for the Downtown Mar-ket, an urban food market promot-

ed by the Grand Action organizationto add a shining amenity to the city.

Now about halfway through com-pletion, the project calls for an out-side seasonal space for 45 vendors,inside space for 22 vendors, a com-mercial kitchen for culinary entre-preneurs, and children’s kitchenswith equipment that adjusts to thevarying heights of kids — alltopped by lighted greenhouses thatwill act as a beacon for motoristsdriving along the U.S. 131 freeway.

The 130,000-square-foot market —about one-twelfth the acreage of De-troit’s Eastern Market — is expectedto be a source for local fresh-grownfoods for adjacent neighborhoods,as well as a drawing card for subur-ban Grand Rapids residents andvisitors.

Grand Action — a not-for-profitorganization co-chaired by Dick De-Vos, David Frey and John Canepa— played a critical role in launchingthe Downtown Market. The organi-zation has led or supported majorprojects that have transformeddowntown Grand Rapids in the pastdecade, including Van Andel Arena,the DeVos Place convention center,the Michigan State University College ofHuman Medicine and the Grand RapidsCivic Theatre.

Jon Nunn, executive director ofGrand Action, said those projectsrepresent a total investment of$338 million, of which $109 millionwas raised privately.

Local observers say the Down-town Market provided tangibleproof of confidence in the area — aconfidence that, in turn, may haveaccelerated projects that were in aholding pattern.

The market boosted the enthusi-asm of father-son development teamMichael and Bob Jacobson “for de-veloping in the area a great deal,”said Suzanne Schulz, planning di-

Stock in the marketDowntown GR project givesdevelopers confidence to invest

See Market, Page 16

20121008-NEWS--0015,0016-NAT-CCI-CD_-- 10/4/2012 2:49 PM Page 1



rector for the city of Grand Rapids.“I believe that the Downtown Mar-ket has given developers greaterconfidence in the projects that theyare doing and, perhaps most impor-tantly, will start to spur market-ratehousing developments.”

The Downtown Market “made it alot easier for projects to go forward,”said Sturtevant of Dwelling Place.

There’s much more heavy-equip-ment traffic at the Downtown Mar-ket now that construction crewsfrom Baker Lofts have arrived. TheJacobsons broke ground ceremoni-ally on their project two weeks agoto renovate a 125,000-square-foot va-cant building diagonally acrossfrom Downtown Market into 87apartments and about 12,500 squarefeet of office and retail space.

The site, formerly known as theCentury Furniture Building, willbecome an affordable-housing pro-ject, with rents for low- and moder-ate-income residents ranging from$450 to $800 a month. The $28 mil-lion project should have its firstunit available by April 1, with theentire building open for businessby July, Michael Jacobson said.

About a 100 yards directly east ofBaker Lofts, construction crewshave narrowed street lanes to makeway for cranes and equipmentworking on the $9.2 million GrandRapids University Preparatory Academy

school, which will house about 500students in grades six through 12.

The Grand Rapids Public Schoolsbroke ground in June on the 53,000-square-foot building, with an ex-pected completion date next fall forall grades. The school, modeled af-ter University Preparatory Academy inDetroit, is a public-private partner-ship with a lead donation of $3 mil-lion from the Steve and Cindy Van An-del Foundation and significantcontributions from the SteelcaseFoundation, Wege Foundation andDan and Pam DeVos Foundation.

One huge question mark in thearea is the fate of a 127,000-square-foot warehouse just across thestreet from the open stalls of themarket. Dwelling Place, which

owns the former Klingman FurnitureCo. warehouse, has listed the prop-erty for $1.5 million for more thana year, Sturtevant said. The num-ber of prospective buyers goingthrough the property has been ris-ing over the past several months, arate that leads Sturtevant to thinkit will be sold in six months.

Sturtevant said his organizationplans to break down walls and reno-vate about 122 small studio apart-ments in the Herkimer building tocreate 55 larger affordable-housingapartments. Another part of theproject will construct a four-storybuilding of 67 apartments and an of-fice building.

About one block east of theDowntown Market, the Inner City

Christian Federation completed con-struction on phase one of severalphases to bring additional housingand retail space to the area — in-cluding a much-needed supermar-ket, said the organization’s presi-dent and CEO, Jonathan Bradford.The ICCF develops nonprofit af-fordable housing in Kent Countyand provides of housing counselingservices for communities through-out West Michigan.

Phase one is an $8.5 million pro-ject that consists of two mixed-use,three-story buildings that have re-tail on the ground floor and 32apartments above.

“We were amazed at the amountof interest in these units,” Brad-ford said. “The buildings were ful-ly occupied in 11 weeks.”

The ICCF is in discussions toarrange financing for four four-unit buildings that would costabout $2.4 million next to phase oneblock, he said. The buildings wouldbe constructed as townhomes, orga-nized through a condominium as-sociation. After those are sold, thenext phase would be five more four-unit buildings of a similar design.

Future phases directly westwould emphasize retail, with afull-service supermarket as itscenterpiece, Bradford said. Thesupermarket would provide thenecessities of life for those living

in the neighborhood and wouldn’tcompete with the urban market.

Brookstone Capital, a Midlandreal estate development firm thathas been involved in downtownGrand Rapids housing for years,plans to begin construction soonon a six-story apartment buildingjust north of the Downtown Mar-ket and two six-story apartmentbuildings on adjacent lots.

The apartment building will beabout 75,000 square feet with 48apartments, with affordable-hous-ing rates of about $340 to $815 amonth and market rates of $900 to$1,400 a month. The three newapartment buildings will add 131housing units to downtown.

Much of the housing demandcan be traced to the influx of stu-dents locating downtown. Schulzpointed to the fact that a number ofcolleges and universities now havea significant presence downtown:the MSU medical school, Grand Val-ley State University, Western Michi-gan University, Thomas M. Cooley LawSchool, Grand Rapids Community Col-lege, Ferris State University and itsKendall College of Art and Design.

Grand Rapids has a populationof more than 40,000 pursuing col-lege studies, Schulz said.

Matthew Gryczan: (616) 916.8158,[email protected]. Twitter:@mattgryczan

Market: Grand Rapids project gives developers confidence■ From Page 15

MATT GRYCZAN/CRAIN’S MICHIGAN BUSINESS

The $30 million Downtown Market is under construction in Grand Rapids.

20121008-NEWS--0015,0016-NAT-CCI-CD_-- 10/4/2012 2:50 PM Page 2

Altair Engineering Inc.Based: TroySpain operations: MadridEmployees: 6Products: Computer simulation projectsTop executives: Stefano Deiana, managing

director More information: The office, opened in

March 2011, is staffed with simulation ex-perts to support the region’s advanced man-ufacturing industry.

Amway Corp. Based: Ada. Spain/Portugal operations:

Main office in Barcelona. Employees: 30 Products: Home care products, durables,

cosmetics Top executives: Gerrado Vallejo, general

manager; Luis Cardoso, sales manager,Portugal, and Susana Alonso, manager,Spain.

Chrysler Group LLC Based: Auburn HillsPortugal operations: 12 dealers, 14 sales lo-

cations and 16 service locationsEmployees: 14Products: Jeep Wrangler, Jeep Wrangler

Unlimited, Jeep Grand CherokeeTop executives: Jorge Navea, CEO of

Bergé Automoción; Francisco Geraldes,managing director of Jeep

More information: Chrysler Voyager andJeep Grand Cherokee led sales in Portugalover the last decade.

Domino’s Pizza LLCBased: Ann ArborSpain operations: 117 Domino’s Pizza

stores throughout Spain, owned by GrupoZena, master franchisee, in Madrid

Employees: 250Products: Pizza, chicken, breadsticks,

desserts, soft drinksTop executives: Miguel Ibarro, CEO of

Grupo ZenaMore information: Domino’s Pizza began

operating in Spain in 2009 when Grupo Zenaconverted 90 Pizza Hut units to Domino’sPizza. The master franchise has sinceopened 27 stores under the Domino’s brandname.

Federal-Mogul Corp. Based: SouthfieldSpain operations: A manufacturing site in

Barcelona, two warehouses in A Corunaand Seville, and a distribution center inCoslada

Employees: 200Products: Friction products

Top executives: David Zapata, generalmanager

General Motors Co. Based: DetroitSpain/Portugal operations: In Spain, GM

has a manufacturing plant in Figueruelasand sales, marketing and aftermarket salesoffices in Madrid. In Portugal, it has a sales,after-sales and marketing operation for theOpel brand in Paco de Arcos.

Employees: 6,054Products: Manufactures the Opel Corsa

and Opel Meriva; sells the Opel modelrange, passenger cars like the Agila, Corsa,Meriva, Astra, Zafira Tourer and Insignia,and commercial vehicles like the Corsa,Combo, Astra, Vivaro and Movano

Top executives: Antonio Cobo, managingdirector in Spain; Guillermo Sarmiento,managing director in Portugal

Haworth Inc.Based: HollandSpain/Portugal operations: In Portugal, Ha-

worth has operations in Águeda, Leiria,Porto, and Queluz. In Spain, it has opera-tions in Madrid, Barcelona, Bilbao andSeville.

Employees: More than 300Products: office furniture and workspaces Top executives: José Amaral, vice presi-

dent of European operations

Kelly Services Inc. Based: TroyPortugal operations: 14 offices and 29 onsite

locations in Portugal.Employees: 129 permanent employees and

more than 5,000 temporary employees.Products: Temporary staffing, search and

selection, onsite services, outsourcing, hu-man resources consulting

Top executives: Afonso Carvalho, countrygeneral manager; Rui Barroso, finance andadministration director

Key Plastics LLCBased: NorthvillePortugal operations: Leiria and Vendas

NovasEmployees: 715Products: Radio and navigation products,

lighting and window controls, air vents, cupholders, assist handles, armrests

Top executives: Rui Filinto Fernandes,president; Gilberto Landim, Leiria plantmanager; Carlos Mano, Vendas Novas plantmanager

MSX International Inc. Based: WarrenSpain operations: MadridEmployees: 215Products: Customer relationship manage-

ment, mystery shopper programs, warrantyand technical assistance, dealer trainingand coaching programs

Top executives: Markus Klaus, managingdirector

TI Automotive Inc. Based: Auburn HillsSpain operations: Barcelona, Montornes de

Segarra, Palencia, Pamplona, O Porriño,Tauste

Employees: 650Products: Fuel tank systems, pump and

module systems, HVAC systems, fluid car-rying systems, powertrain components

Top executives: Oscar Bercedo, generalmanager, Spain

TriMas Corp. Based: Bloomfield HillsSpain operations: manufacturing facility in

Tarragona Employees: 10Products: Metallic and nonmetallic gas-

kets, various types of bolts, industrial fas-teners and specialty products

Top executives: Valentin Gutierrez, gener-al manager

TRW Automotive Inc.Based: LivoniaSpain/Portugal operations: In Portugal,

TRW has operations in Ponte de Lima, Vi-lanova de Cerveira and Lisbon. In Spain,TRW has operations in Palau-solitá i Plega-mans, Alfaro, Arganda del Rey, Barcelona,Corella, Egüés, Olvega, Pozuelo de Alar-con, Madrid, O Porriño, Valladolid, Vigo,Las Palmas de Gran Canaria and Pam-plona

Employees: TRW has 2,784 employees inSpain and 1,261 in Portugal.

Products: Steering wheel and driverairbag modules, aftermarket, instrumentclusters and panel switch, sales, purchas-ing and finance services, magnesium,frames production, electric power steeringcolumn drives, hydraulic racks and pinionsteering gears, mechanical racks and pin-ion steering gears

Top executives: In Portugal, the top execu-tive is Javier Rodrigo Almazán, generalmanager of Lisbon aftermarket; and inSpain, the top executive is Pedro Lopez, di-rector and general manager for FrictionMaterials Group.

Visteon Corp. Based: Van Buren TownshipSpain/Portugal operations: Palmela in Por-

tugal and in Spain, Medina de Rioseco, Sal-ceda de Caselas, Igualada, Barcelona

Employees: In Spain, 800; and in Portugal,1,160

Products: Electronics, climate and otherinterior systems

Top executives: Michel Serre, managingdirector of interiors, in Spain and in Portu-gal, Joao-Paulo Ribeiro, director of elec-tronics


Month ly Spain/PortugalWHERE MICHIGAN DOES BUSINESS

SPAIN

FRANCE

Seville

Valencia

Madrid, CosladaTarragona

Barcelona, IgualadaMontornes de Segarra

Tauste, Figueruelas

ValladolidPalencia

A Coruna

Águeda

Palmela

Vendas Novas

pain and Portugal share a 750-mile border —but Spain is the much bigger economic engine.

Spain’s economy is the 13th largest in theworld, according to the CIA World Factbook. It hadthe 14th-largest GDP in 2011 at $1.4 trillion. Portu-gal’s GDP was $237.5 billion.

Both countries have struggled with high unem-ployment. Efforts to improve Spain’s economy areimportant to watch; Portugal received a bailoutfrom the European Union. Market analysts havebeen watching to see if Spain would call for euro-zone help to stabilize public finances, but as of presstime for this page that had not occurred.

Spain’s top exports include cars and car parts,machinery, metals, vegetable products, chemicals,mineral products and textiles. Portugal exportsproducts such as clothing and footwear, machinery,cars, plastics, rubber and wood pulp.

Crain’s monthly World Watchreport showcases companiesleading the way in internationalbusiness, as well as those ex-panding their global operations.

Each World Watch Monthlyfeatures a different country. Ifyou know of a Michigan compa-ny that exports, manufacturesabroad or has facilities abroad,email Jennette Smith, managingeditor, at [email protected].

COMING UP� November: Russia� December: Saudi Arabia/Qatar/

Jordan

S

PORTUGALLeiria

Lisbon,Amadora, Pacode Arcos, Queluz

O Porrino, Salcedade Caselas

Ponte de Lima

Porto

PamplonaMedina deRioseco

Federal-Mogul aftermarket distribution center inCoslada, Spain

MSX International’s headquarters in Madrid

TRW plant in Ponte de Lima, PortugalA Chrysler dealership in Lisbon, Portugal


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BUSINESS DIARYACQUISITIONS

The Farmington Downtown Develop-ment Authority finalized a transactionto purchase the property at 33200Grand River Ave. from Basile Anasta-siou.

CONTRACTSHyundai America Technical CenterInc., Superior Township, has selectedMagnum Quality Resources, SterlingHeights, for training and consultingservices to assist in achieving its ISO17025:2005 laboratory accreditationgoals and objectives.Automotive Industry Action Group,Southfield, announced that NorfolkSouthern Corp., Norfolk, Va., a trans-portation company, has joined thenot-for-profit, member-supported or-ganization.UHY LLP, Sterling Heights, a financialservices company, announced a newmember, UHY Botello & Marquez S.A.,to the UHY global accountancy net-work.H.B. Stubbs Co., Warren, a global ex-hibit and event marketing company,announced it has added nine newclients: Affinia Group, Ann Arbor, anautomotive supplier; Cassidian, Un-terschleissheim, Germany, a globalsecurity solutions and systems com-pany; Dana Holding Corp., Maumee,Ohio, an automotive supplier; Data-mars Inc., Woburn, Mass., a radio-fre-quency identification company for theanimal and textile identification mar-kets; Holcim, Jona, Switzerland, a sup-plier of cement and aggregates, andready-mix concrete and asphalt;Horstman Inc., Sterling Heights, a de-signer and manufacturer of defenseproducts; Hyundai Motor America,Fountain Valley, Calif., a subsidiaryof Hyundai Motor Co., Korea; LivingSo-cial Inc., Washington, D.C., an elec-tronic commerce company; and Novar-tis International AG, Basel,Switzerland, a healthcare company.Plex Systems Inc., Auburn Hills,

provider of Plex Online cloud enter-prise resource planning software formanufacturers, announced that Ac-curide Corp., Evansville, Ind., a sup-plier of components to the commercialvehicle industry, will deploy Plex Sys-tems’ software-as-a-service/cloud en-terprise resource-planning softwareacross its core operations.Emergency Physicians Medical Group,Ann Arbor, and Emergency MedicineBusiness Intelligence, Parsippany,N.J., announced a new partnershipthat will allow EPMG to offer an emer-gency department performance dash-board and analytics software to itshospital partners.MWW Automotive Group, Howell, aglobal design, engineering and manu-facturing firm, was awarded the con-tinuation of production for paintingand fulfillment of interior parts forthe Ford F-150 series line of trucksthrough 2013, from Ford Motor Co.,Dearborn.ForeSee Results Inc., Ann Arbor, acustomer experience analytics compa-ny, was chosen by HSN Inc., a multi-channel retailer in St. Petersburg,Fla., to measure and analyze the cus-tomer experience of its mobile-opti-mized site and mobile apps with Fore-See’s new Mobile On-Exit technology.Clark Construction Co., Southfield,was selected by Beaumont Hospital,Troy, as construction manager for a $3million, two-phase project to relocatethe central processing department tothe second floor on 5West.

EXPANSIONSStarr Commonwealth, Albion, a childand family services organization,opened Starr Detroit Academy, anopen admissions charter school, at19360 Harper Ave., Harper Woods.Telephone: (313) 638-2730. Website:www.starracademy.org.Wigs 4 Kids of Michigan Inc., St. ClairShores, opened an ancillary supportservices office at 31235 Harper Ave.,St. Clair Shores. Telephone: (586) 218-1144. Website: www.wigs4kids.org.Chez-Zara LLC, Detroit, an espressobar, opened a second location at 1555Broadway St., Detroit. Website:www.chez-zara.com.Dickey’s Barbecue Restaurants Inc.,Dallas, opened a Dickey’s BarbecuePit, a quick-serve barbecue restau-rant, at 4825 Carroll Lake Road, Com-merce Township. Telephone: (248) 360-4055. Website: www.dickeys.com.

MOVESFinsilver Construction & DevelopmentCorp. moved from 2075 W. Big Beaver,Suite 250, to 2011 Austin Drive, Troy.

Telephone: (248) 878-2081. Website:www.fcdcorp.com.Warren Strategies Inc., a marketingfirm, moved from Troy to 2000 TownCenter, Suite 140, Southfield. Tele-phone: (248) 358-1818. Website:www.warrenstrategies.com. World Wide Tax Services PC, an ac-counting and tax preparationprovider, moved from Fraser to 28250Southfield Road, Suite 220, Southfield.Telephone: (734) 945-0205. Website:www.worldwidetaxonline.com.Rochester Center for Healthy Livingmoved from 725 Barclay Circle to 1854W. Auburn Road, Rochester Hills, andchanged its name to The Waller Well-ness Center. Telephone: (248) 844-1414.Website: www.wallerwellness.com.Capture A Moment Photography LLCmoved from Harrison Township to 117Cass Ave., Suite 308, Mount Clemens.Telephone: (586) 646-8189. Website:www.captureamomentphoto.com.

NEW PRODUCTSCarhartt Inc., Dearborn, a work-wearbrand, launched a line of flame-resis-tant work apparel including a shirt, arelaxed-fit pant and a coverall, and an-nounced the availability of the Weath-ered Duck, the newest member of theCarhartt pant line. Website:www.carhartt.com.Asahi Kasei Plastics N.A. Inc.,Fowlerville, is working with UnifiedEnergies International Inc., CarsonCity, Nev., in the development of theWindstrument wind turbine to mass-produce affordable renewable energy.Website: www.windstrument.com.TRW Automotive Holdings Corp., Livo-nia, announced its next-generationPedestrian Protection System, whichuses a combination of accelerationand pressure-sensing technologies todetect a pedestrian impact. Website:www.trwauto.com. BrassCraft Manufacturing, Novi, amanufacturer of plumbing supplies,added two new water stops to its push-connect technology line of products.Website: www.brasscraft.com.Stardock Entertainment Inc., Ply-mouth, announced the 2012 edition ofits political strategy game, The Politi-cal Machine. Website: www.politicalmachine.com.

NEW SERVICESValassis Communications Inc., Livo-nia, launched RedPlum Social Savings, a coupon app built on theFacebook platform. Website:www.redplum.com.Summit Sports Inc., Bloomfield Town-ship, launched an online storefront forsnowboarders, www.snowboards.com.


� BrendaBohnsack, M.D.,assistant professorof ophthalmologyand visual sciencesat the University ofMichigan, receivedthe Research toPrevent BlindnessCareer DevelopmentAward. The awardhelps support youngresearchers of

ophthalmology with $250,000 infunding over four years.

� DavidGinsburg, M.D., theJames V. Neeldistinguisheduniversity professorof internal medicine,human genetics andpediatrics at theUniversity ofMichigan MedicalSchool, will receivethe 2012 Henry M.Stratton Medal for

his accomplishments in the fields ofthrombosis and blood cell immunology.

� Mohammed Arsiwala, M.D., thepresident and medical director ofMichigan Urgent Care, a system of 10urgent care facilities, has beenappointed by Gov. Rick Synder to theControlled Substance AdvisoryCommission and will serve a one-yearterm. Arsiwala represents the Board ofMedicine — to which he was appointedin January — and will serve a one-yearterm.

� J. MichaelKramer, M.D., hasbeen named seniorvice president andchief quality officerof Spectrum HealthSystem in GrandRapids. Kramer hasbeen with SpectrumHealth since 2011as vice presidentand chief medicalinformation officer.

� David Dull,M.D., became thenew chief medicalofficer of Providenceand Providence ParkHospitals in August.Dull servedpreviously as directorof operations forSecure HealthHub, aVermont-basedhealth care ITcompany and vice

president for quality at Spectrum HealthButterworth Hospital.

BY JAY GREENE


plan intended to foster in-terconnected health infor-mation exchanges across

the state has gone awry ascompanies providing the ser-vices compete for hospitals,physicians and market share.

The health information ex-changes — not to be confusedwith the health insurance ex-changes under health care re-form — are intended to helpmake it easier for hospitals andphysicians to exchange patientinformation, thereby achievinglower costs and higher qualityby better coordinating care andreducing service duplication.

The problem is the two ex-changes with the biggest mar-ket share, Okemos-based GreatLakes HIE and Grand Rapids-based Michigan Health Connect,use different information sys-

tems that cannotexchange datawith providersthat select otherexchanges.

The executivedirectors of thetwo HIEs, Carol

Parker of Great Lakes andDoug Dietzman of MichiganHealth, say the goals of theirorganizations are to becomestatewide exchanges.

But while each HIE is highlycompetitive in seeking to addhospitals and physicians, Park-er and Dietzman say they havebeen talking the past severalmonths over ways to share data.

An agreement between thetwo HIEs could be reachedwithin a year to integrate theirpatient data systems, the twoexecutives say.

Parker said she also has dis-cussed patient data sharing us-ing patient queries and Great

Lakes’ master patient indexwith several other HIEs inMichigan, including two inmetropolitan Detroit: South-east Michigan HIE and IngeniumLLC, formerly My1HIE.

“We are working with ourvendor on this now,” Parkersaid. “A lot of hospitals andphysicians indicate to me theywould like to see the (regional)HIEs share data. From a public

health, quality and cost stand-point, it doesn’t make sensenot to share data.”

Dietzman said he believesultimately there will be infor-mation exchange among allthe HIEs in Michigan. Thequestion is just when, he said.

“I don’t have any providerscoming to me and saying thatthis is something I need you todo. That is part of the issue.

When they start saying that,then maybe we will movefaster,” he said.

Connection problemIn 2006, Gov. Jennifer

Granholm approved a plan tocreate nine substate health in-formation exchanges — onlinedatabases that allow compet-ing medical providers to in-stantly share patient informa-tion in a secure format — andencourage the HIEs over thenext five years to grow. As itturned out, there are six.

Many experts say that ini-tial plan is partially success-ful. But Granholm’s plancalled for the regional HIEs to


� St. JohnProvidence HealthSystem, Warren, andthe Michigan marketof Ascension Health,St. Louis, Mo., havenamed FrederickBrown their firstchief innovation andnew venture officer.Brown, 53, had beenmanaging director ofDucker Worldwide,

Troy. He graduated magna cum laudewith a Bachelor of Science degree inbiology and genealogy from TuftsUniversity, Medford, Mass., and an MBAfrom Harvard Business School.

People

Ext ra

Data disconnectCompetition among health information exchanges slows development of statewide system

Brown

Bohnsack

Ginsburg

WHERE THE EXCHANGES AREThere are six health information exchanges in Michigan, with two of them — Michigan Health Connect and Great Lakes HIE — having the mostmarket share.

REX LARSEN

Executive Director Doug Dietzman works with his staff at Michigan Health Connect in Grand Rapids, one of the twoleading health information exchanges in Michigan.

A

� Michigan Health Connect, GrandRapids: The largest HIE in thestate, with 54 of the state’s 134medical-surgical hospitals asmembers, including BeaumontHealth System, St. JohnProvidence Health System,McLaren Health Care, TrinityHealth and Botsford Hospital.� Great Lakes HIE, Okemos: Thesecond-largest HIE. Among itsmembers are the University ofMichigan, Michigan State

University, Sparrow HealthSystem and Garden City Hospital.� Southeast Michigan HIE, Detroit:Chaired by Robert Jackson, M.D.,and administered by Helen Hill. InJuly, it completed a $3 millioncontract with the Social SecurityAdministration to develop anelectronic disability claims systemthat Hill said will speed applicationsfrom an average of 457 days to lessthan a day. A number of healthsystems, insurers, provider groups

and employers participate.� Ingenium LLC, Bingham Farms:Network of several hundredphysicians and other providersdeveloped by United Physicians.Led by John Visvara, United’s COOand senior vice president. UsesAT&T’s Amagine portals, whichallow physicians to connect withinsurers to check insuranceeligibility, medical claims, patientregistries, electronic prescribing,claims management and

communication services. Theportals have been developed byCovisint, a division of Detroit-based Compuware Corp.

� Upper Peninsula Health Network,Marquette: Includes DickinsonCounty Healthcare System, BellMemorial Hospital and WarMemorial Hospital.� Jackson Community MedicalRecords, Jackson: A joint ventureof Allegiance Health and JacksonPhysicians Alliance.

Source: Michigan Health Information Network, HIE websites

See Data, Page 20

From a public health, quality andcost standpoint, it doesn’t make sense

not to share data.Carol Parker, Great Lakes HIE

”“

Kramer

Dull

$36 BILLIONFederal fundsfuel hospitaltech spending,Page 20


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Health Care Extra

become interconnected by thisyear through the Michigan HealthInformation Network.

Now some believe it could takeseveral more years for that goal tobe reached.

In the meantime, the six surviv-ing substate HIEs in Michigan aresigning up dozens of hospitals andphysicians, developing differentinformation technology approach-es and starting to exchange patientdata within their own organiza-tions.

But last year, a study by HarvardUniversity researchers in the An-nals of Internal Medicine foundstates that have promoted the useof a single HIE, including Indiana,Maryland and Massachusetts,have not only moved more quick-ly ahead in the goal of exchangingpatient information, but thoseHIEs also are more financiallystable.

Dietzman said states that haveset up single HIEs are smaller andless complicated than Michiganand have state financial support.

Nationally there are more than250 HIEs, including 160 privateHIEs, but less than 60 are ex-changing data, and only 40 per-cent of those receive sufficientrevenue to cover expenses, stud-ies show.

Solution: One for allTo address patient data frag-

mentation by having separate re-gional HIEs, the Michigan Healthand Hospital Association’s HIE taskforce concluded in June that thebest solution for Michigan is tohave a single, statewide HIE, saidJim Lee, the association’s vicepresident for data policy.

“As the state moves forward withHIEs, we are asking if it makessense to continue doing what weare doing” or if a new approach isneeded, Lee said. “We have asyn-chronous growth with some HIEsdoing well and the others not show-

Data: Health info exchanges at odds■ From Page 19

BY JAY GREENE


Since the federal government’sHITECH Act in 2009 provided $34 billion in funding for hospi-tals, physicians and otherproviders to develop electronicmedical record systems and an-other $2 billion to states forhealth information exchanges,health care organizations inSoutheast Michigan have gone onan electronic spending splurge.

The HITECH (formally theHealth Information Technologyfor Economic and Clinical Health)Act, was part of the $787 billionstimulus bill, or the American Re-covery and Reinvestment Act,which was designed to provide aboost to the economy followingthe economic meltdown of 2008and 2009.

So far, hospitals in SoutheastMichigan have received millionsof dollars from the federal gov-ernment to help defray theircosts to develop electronic med-ical record systems. Physiciansand other eligible providers alsoinvesting in EMR systems canalso receive thousands of dollarsto defray their average cost of$40,000 per physician.

For example, the University ofMichigan Health System is spend-ing $250 million on its EMR andbilling system over the next 10years and expects to receive $30million to $40 million back in fed-eral incentive payments; OakwoodHealthcare is spending $80 millionand expects to receive $31 millionback; Beaumont Health System hasspent $100 million the past fiveyears and has received $24 mil-lion in payments; and Henry Ford

Health System will spend $350 mil-lion, with $59 million cominghome in incentive payments.

All the systems are usingEMRs developed by Epic Systems,a Verona-Wis.-based informationtechnology company.

The HITECH Act also providedmillions of dollars to help statesestablish health information ex-changes. Michigan received $15 million in 2010 to develop theMichigan Health Information Net-work, a coordinating agency forthe state’s six sub-state HIEs.

MiHIN is a collaboration of theMichigan Department of CommunityHealth, the state Department ofTechnology, Management and Bud-get and private organizations.

Managed by a regional healthinformation organization, an HIEis a computer technology that al-lows providers, pharmacies,health insurers, imaging centersand the like to share patient infor-mation contained in EMRs andother health care databases.

Most experts believe care coor-dination will lead to improvedquality, lower costs and less po-tential for adverse medicationand allergy reactions.

In a 2010 survey of hospitalsand physicians by KLAS Enterpris-es of Orem, Utah, the most com-mon data elements exchanged by93 percent of HIEs are medication(83 percent), radiology results (81 percent) and patient allergies(74 percent).

But only 48 percent could sharecomplete patient records, whichare called continuity-of-care doc-uments.

Jay Greene: (313) 446-0325,[email protected]. Twitter:@jaybgreene

Federal funds fuel hospitals’ high-tech spending spree

See Next Page

AL GOLDIS

Carol Parker is executive director of the state’s other leading health information exchange, Great Lakes HIE in Okemos.


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ing any sustainability.”Lee said the hospital associa-

tion board voted in September toencourage hospitals to select ei-ther Great Lakes or MichiganConnect as their HIE, which couldreduce data exchange fragmenta-tion.

But he added that the MHAboard decided not to lobby thestate to fund or push for astatewide HIE, although it be-lieves that is the best long-termgoal.

“The hospital association isclearly trying to broker better co-ordination with the HIEs and,where feasible, more collabora-tion,” said Andrew Rosenberg,M.D., chief medical information of-ficer with the University of MichiganHealth System in Ann Arbor.

“The debate is a single HIE or in-terrelated HIEs. I argue that a sin-gle HIE is a better model,” saidRosenberg.

Parker and Dietzman said theirorganizations are not contemplat-ing a merger. They say collabora-

tion to sharedata is a morerealistic goal, atleast for now.

Brian Connol-ly, CEO of Dear-born-based Oak-wood Healthcare,said the four-hospital system,which is in-stalling an Epic

Systems electronic medical recordsystem, is one of a few health careorganizations in Southeast Michi-gan that have not selected an HIE.He said Oakwood prefers to waituntil there is a single, statewideHIE.

“I would like to see it structuredso all hospitals, doctors and sys-tems are in (one HIE) so we don’tneed to have interfaces and com-pete” with each other, Connollysaid. “We don’t want to invest inan HIE that gets absorbed or dis-continued. We can wait for a singleone.”

Oakwood, like all hospital-basedsystems and most physicians inSoutheast Michigan, is spendingmillions of dollars on internal elec-tronic medical record systems toconnect its hospitals and affiliatedphysicians.

Parker said she understandsconcerns like those expressed byOakwood. But she said she wouldprefer more hospitals to be thetable to help push the HIEs to col-laborate and develop internal sys-tems.

“Last year we decided to expandstatewide to be (financially) sus-tainable. We don’t want to over-whelm participants with costs be-cause it is expensive to develop theinfrastructure for an HIE,” Parkersaid.

State input neededSubra Sripa-

da, chief admin-istrative and in-formationofficer for Beau-mont Health Sys-tem, said Michi-gan Health willeventually helpBeaumont elec-tronically con-nect with pri-

vate practice physicians that arenot on its Epic EMR.

But Sripada said a single HIEeventually is needed in Michigan.

“There is lots of fragmentation,with some HIEs doing a good joband the others not so,” Sripadasaid. “The state needs to get more

involved. I believe there will bemore urgency when health care re-form kicks in because we need toexchange information” to improvequality and lower costs.

Over the next several years,Michigan Health, Great Lakes andSoutheast Michigan HIE and other

private HIEs are expected to con-nect with the Michigan Health In-formation Network, said Execu-tive Director Tim Pletcher.

MiHIN, the statewide organizerof the regional networks, alsocould connect into a nationwideHIE network, he said.

Pletcher views the multiple HIEprojects under way in Michiganlike the work done in the earlyyears of the Internet.

“We had lots of innovation, cre-ativity, experimenting and techiework to form the computer net-works. It all came together towhat we have now as the Inter-net,” he said. “Like where we arenow with the HIEs, it wasn’t pret-ty in the beginning. We will

get there.”But Dietzman said he believes

natural market forces will lead to aconsolidation of HIEs and greatercollaboration to exchange data be-tween Great Lakes and MichiganHealth.

“There is nothing in place tostructurally force everything intoa single exchange,” he said. “Theproblem is you have two indepen-dent boards that do not feel overlycompelled to give up what they aredoing. Both are progressing. Weknow we have to interact eventual-ly in Michigan and with northernOhio and Indiana.”

Jay Greene: (313) 446-0325,[email protected]. Twitter: @jaybgreene

From Previous Page

Connolly

As the state moves forwardwith HIEs, we are asking if itmakes sense to continue doing

what we are doing.Jim Lee, Michigan Health and Hospital Association

”

“

Sripada


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Health Care Extra

Movement to cut hospitalvisits by seniors: Exercisefor the mind and body

BY JAY GREENE


Erwin “Itsy” Lieberman standsat the forefront of a movementwithin senior living and healthcare facilities that offers residentsmind-body exercise programs thathave the potential to cut costs byreducing unneces-sary emergency de-partment visits andhospitalizations.

Says Direc-tor CarolRosenberg ofthe Jewish Se-nior Life Foun-dation — whohas knownItsy for 30years: “Itsyhas the abili-ty not only tobring out exercise (inpeople) but the spiritof the human being.… This is a holisticwellness approach toaging that we encour-age.”

Each Wednesdayfor the past five years,Lieberman, 69, hastaught a Sunrise Chi exercise classto eight to 16 residents of the Lil-lian and Samuel Hechtman Apart-ments in West Bloomfield Town-ship. Their ages range from early60s to the oldest student at 102. TheJewish foundation helps supportthe apartments and its owner, Jew-ish Senior Life of Metropolitan Detroit.

“ ‘Chi’ means life’s energy,”said Lieberman, a former autocompany marketing executivewith a black belt in karate.

“I know when I do my exercisesthat I am helping them. We had a90-year-old woman who got upfrom her chair and danced withme. Seniors love music. When youplay it, they move.”

Lieberman — who ends his classin a line dance to the song “Oh,What a Beautiful Morning” — saidhe has helped hundreds of stu-dents improve their health overhis 39 years as a Sunrise Chi in-structor.

A form of tai chi, Lieberman’sSunrise Chi classes focus onstretching and exercises that stim-ulate the mind and increase bloodflow.

“One person in my class used arespirator (medical ventilator),and she improved (lung capacity)by 50 percent,” Lieberman said.“Another one with polio, wehelped gain muscle strength. Andpeople with Lyme disease, we canhelp give them more energy.”

Rosenberg said participation inthe class is voluntary.

“We have physicians who pre-scribe occupational and physicaltherapists to come here, but peoplelike Itsy who volunteer their timehelp us keep our residents activebecause our dollars are limited,”

Rosenberg said.The 198-unit Hechtman Apart-

ments is part of Jewish SeniorLife, which operates seven inde-pendent living and assisted livingfacilities for more than 900 resi-dents ages 62 and older. Some resi-dents are eligible for low-incomeassistance programs offered by the

federal gov-ernment.

Researchhas demon-strated thatexercise pro-grams gearedtoward olderadults im-prove physi-cal and mentalfunctions andreduce disabil-ity, says thefederal Centersfor Disease Con-trol and Preven-tion.

“I tell (theclass) it is allabout puttinga smile onyour face,having fun,gaining flexi-

bility and ability,” Liebermansaid. “When you get older, youcan’t do the exercises they haveon cable TV. I make sure theyhave the right exercise for theirages.”

Lieberman, who played footballand threw the javelin on the trackteam at Wayne State University, saidaging leads to decline in strength,endurance, flexibility and balance.

“I try to slow the aging processwith exercise. I make them move,and every muscle is worked,”Lieberman said.

“People come to long-term carefacilities to die. I say they shouldcome here to live.”

CDC-funded studies show thatseniors involved in a one-hourclass featuring strength, aerobicand flexibility exercises see a vari-ety of improvements to theirhealth. For example, seniors whoparticipated in a one-hour classthree times a week improved phys-ical, emotional and social healthscores by up to 30 percent. Thoseseniors in a control group who didnot exercise deteriorated in thesemeasures, the CDC said.

Lieberman also teaches classesat the Red Run Golf Club in RoyalOak and Chester Street ResidenceAssisted Living Community and tospecial-needs students atRochester High School. He alsohas a book out about his careerand a 30-minute television show,“60 Years Young With Itsy,” start-ing at 7 a.m. on public access sta-tion CMNtv-Channel 18.

For information on Jewish Se-nior Life, see www.jsmli.org.


I try to slow theaging processwith exercise.

... Peoplecome to long-

term carefacilities to

die. I say theyshould come here to

live.‘Itsy’ Lieberman,

Sunrise Chi exercise leader

”

“


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Health Care Extra

Health economist to discuss the state of health care at summitan equal measure of higher taxesand Medicare payment reductions.

However, from 2011 to 2021, theU.S. health care system will spendmore than $33 trillion, which in-cludes spending on Medicare,Medicaid, commercial insuranceand the uninsured.

“Health care reform is an exam-ple of (the axiom) that there is nosimple idea that Americans won’tcomplicate beyond belief,” Rein-hardt said.

“The health care industry willcontinue to be fragmented, overlycomplicated, with no one knowing

what is going on,” he said. “Wespend 18 percent of our gross do-mestic product on health care, andnobody knows the prices or thecosts. Every provider charges abill, and the bills are so complicat-ed you can’t figure them out.”

Reinhardt said he favors theGerman and Swiss health care sys-tems, which have universal cover-age using a public-private deliveryand financing approach.

For example, some 85 percent ofGermans opt for basic publichealth coverage, and 15 percentpurchase higher-benefit private

insurance policies.In Switzerland, people are re-

quired to buy insurance from pri-vate companies, but the companiesare not allowed to earn profitsfrom mandated benefits. Theymay sell additional benefits at aprofit for supplementary policies.

But Reinhardt said the Afford-able Care Act has provisions thatcould help improve quality andlower costs.

“You have a fence in your yardthat is broken. Your spouse givesyou the tools to fix it. The tools donot fix the fence. You use the tools

to fix it. This is what the Afford-able Care Act does: provides thetools you need to fix the healthcare system,” Reinhardt said.

For example, the health care billprovides $1 billion for “compara-tive effectiveness” studies. Thiswill enable academic researchersand providers to come up withideas on how to provide more effi-cient, effective and lower-cost clin-ical practices, procedures andmedical technology.

“It is a small donkey to carry aheavy load, but it is better thannothing,” he said.

BY JAY GREENE


Noted Princeton University healtheconomist Uwe Reinhardt will givethe keynote address at Crain’sfourth annual health summit at theSan Marino Club in Troy on Oct. 30.

Reinhardt —known as an ex-pert on hospitalpricing,Medicare re-form and com-paring the U.S.health care sys-tem to othercountries —said there are anumber of

forces buffeting health care, andsome of them are beyond the con-trol of the health care system.

“We have a growing number ofbaby boomers who will costMedicare more over the next fewyears,” he said. “We have the fi-nancial crisis that has destroyedimagined wealth. When the finan-cial markets screw up, the econo-my gets hurt. We are still in themiddle of that, and now we havehealth care reform.”

Reinhardt said U.S. health carereform was “driven by politics andwritten by people with law de-grees” who do not understand thebest way to drive efficiencies.

Reinhardt said health care mustbe reformed because defense,health care and education are com-peting for funding within state andnational budgets.

While he says he supported ap-proval of the Patient Protectionand Affordable Care Act of 2010,the ultimate success of health carereform depends on how well costsare contained.

Reinhardt noted that the cost ofhealth care reform over 10 years is$1.1 trillion, which is paid for by

ATTEND HEALTH CARE SUMMITAs the health care industry looksat changes in 2013 and 2014 fromthe Affordable Care Act, thestruggle remains to provide bettercare at a lower cost. Finding a common ground on thatdebate is the focus of this year’sCrain’s Health Care Summit.Following keynote speaker UweReinhardt will be a panel ofcorporate executives and healthcare experts discussing thedifferences.Tom LaSorda, former CEO ofChrysler Group LLC, will moderatethe panel, joined by NancySchlichting, CEO, Henry Ford HealthSystem; Keith Pitts, vice chairman,Vanguard Health Systems Inc.; ScottEathorne, CEO, St. John Partners inCare; Rick Popp, director ofemployee benefits, Ford Motor Co.;and Thomas Simmer, senior vicepresident of Blue Cross Blue Shieldof Michigan. Blue Cross ispresenting sponsor.A kickoff event that day will focuson corporate wellness withspeaker Dee Edington, director ofthe University of Michigan HealthManagement Research Center anda wellness consultant. Sponsor ofthe breakfast is Priority Health. The summit will be from 7:30 a.m.-2 p.m. at the San Marino Club inTroy. To register, go towww.crainsdetroit.com/events.

Reinhardt


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Health Care Extra

Judge in Aetna suit tells Blues to provide methods for setting execs’ payBY CHAD HALCOM


Blue Cross Blue Shield of Michiganwill not have to disclose compensa-tion data for 17 past and present se-nior executives to competitor Aet-na Inc. but will have to disclose itsmethods of setting that compensa-tion, a judge has ruled.

It’s the latest in a few unusualturns during the discovery processfor a December 2011 federal law-suit in Detroit by Aetna, whichclaims up to $2 billion in trebledamages against Blue Cross on

more than $550 million in allegedlost profits, future profits and di-minished business value.

Magistrate Judge Mona Maj-zoub at U.S. District Court on Sept.24 ordered Aetna to provide up-to-date documentation to supportsuch a figure — which, if awardedat a trial, would more than tripleany other known Michigan civillawsuit judgment in recent histo-ry.

Aetna insured about 300,000Michigan residents in 2010through either individual or largegroup enrollments, according to

past data furnished to Crain’s.Blue Cross insured more than 4.3million in the state that same year.

Majzoub also ordered in a sepa-rate ruling on Sept. 26 that BlueCross must disclose “all targets,

goals, or formulas concerning anyform of compensation for” BlueCross CEO Dan Loepp, CFO MarkBartlett and 15 other top execu-tives between 2005 and 2011, butnot their compensation totals.

“Detailed compensation andbenefit information sought in (Aet-na’s discovery requests) is not rel-evant to whether (Blue Cross) op-erated as a nonprofit, charitableand benevolent institution,” Maj-zoub’s ruling states. “However …asking for the targets, goals, or for-mulas concerning any form ofcompensation for identified offi-cers or senior executives of BlueCross … is relevant.”

At issue in the lawsuit are so-called “most favored nation” andnation-plus agreements, two setsof billing arrangements Blue Crossallegedly began making withMichigan hospitals in 2007.

Those are also the basis of a 2010joint civil action against the Bluesby the U.S. Department of Justice andthe Michigan attorney general’soffice. Several related civil law-suits followed, including Aetna’sown suit late last year.

The more conventional most-fa-vored-nation agreements requiredonly that Blue Cross get a billingrate at least equal to any other in-surer. The plus agreements causedhospitals to charge the competi-tors more.

Helen Stojic, director of corpo-rate affairs at Blue Cross, said theinsurer was pleased with Maj-zoub’s findings on compensationand does not plan an appeal. ScotRoskelley, communications direc-tor for Aetna’s mid-America re-gion, said he was still awaitingword on whether Aetna will ap-peal.

Roskelley did, however, say thatAetna still expects to be able tosupport its $2 billion damagesclaim, after Majzoub granted BlueCross’ request to provide up-to-date damage computations and ac-cess to records that back up itsdamages totals by Nov. 1. BlueCross claims Aetna made a com-parison of projected versus actualprofits in Michigan using only “24pages of stale, 2005 documents”speculating on future profits tosupport its large sums.

“We are confident the evidencewill establish that Blue Cross BlueShield of Michigan’s misconductresulted in significant impairmentto our ability to fairly compete inMichigan and resulted in harm toAetna and Michigan consumers,”he said in an email to Crain’s. “Wewill continue to provide support-ing evidence for our case through-out the discovery and with sup-ported expert testimony.”

Stojic, however, suggested Aet-na may have a distorted sense ofthe scale of its $2 billion claim dueto its comparative size.

“For a rich company like Aetnathat just spent more than $7 billionto buy Coventry Health, $2 billionprobably does not seem like much.But it does to us,” she said in astatement.

“In this lawsuit, Aetna sued us,a smaller (and nonprofit) healthplan, because they claimed finan-cial hardship. In fact, they pulledout of Michigan because they did-n’t want to invest to competehere.”

Chad Halcom: (313) 446-6796,[email protected]. Twitter:@chadhalcom

Asking for the ... formulas concerning ...compensation for identified officers ... of

Blue Cross ... is relevant .Mona Majzoub, magistrate judge

”“


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Health Care Extra

GDAHC narrows its focus to policy issues, collaborationBY JAY GREENE


The Greater Detroit Area HealthCouncil is going back to its rootswith a new, more focused strategicplan that calls for the council totake positions on topical healthcare issues, continue to conductcost reduction and quality im-provement initiatives and workmore directly with employers onhealth and wellness issues.

“GDAHC has tried in the past tobe all things to all people. We are

going to focuson a few vitalthings we canget done and col-laborate withother organiza-tions on areas ofmutual inter-est,” said KateKohn-Parrott,who has beenworking on the

plan since she was named CEO ofthe health council in January.

The health council, founded in

1944, has a multistakeholder mem-bership group that includes hospi-tals, employers, health plans,provider organizations, physi-cians, labor organizations and gov-ernmental bodies.

Like most membership organi-zations, the council needs to findmore revenue sources over thenext two years to fund operationsas member contributions for pro-jects have dwindled over the pastseveral years, Kohn-Parrott said.

To address topical health issues,the council will expand its “Coffee

and Controversy” breakfast meet-ings to delve into more provoca-tive health care community topics,Kohn-Parrott said.

“We want to be the thoughtleader on difficult topics — the ele-phant-in-the-room-type issues,”she said. “We might have a forumabout McLaren Health Care’s newhospital proposal for Clarkston or(legislation to change) Blue CrossBlue Shield of Michigan into a non-profit mutual.”

Kohn-Parrott said the healthcouncil could host half-day or full-

day meetings on a hot topic, thentake a position on it.

“We would present both sides ofthe issue, debate it and ultimatelywould write an opinion about theissue,” she said. “GDAHC used tobe the go-to organization on healthissues of the day.”

Of the council’s annual $1.7 mil-lion budget, 38 percent comes fromgrants from the Robert Wood John-son Foundation, 28 percent frommember dues, 28 percent frommember contributions for cost andquality programs and the remain-der from fundraisers, conferencefees and other sources.

But member contributions forcost and quality projects havedropped from $1.4 million in 2006to $316,000 in 2011, primarily be-cause of member budgets.

“Our mission is to help South-east Michigan deliver on thepromise of a high-value healthcare system that focuses on qualityimprovement and cost contain-ment,” Kohn-Parrott said.

For example, she said, the coun-cil will focus on improving car-diac care in a project with theMichigan chapter of the AmericanCollege of Cardiology, MPRO and 12hospitals.

Another key to continue this ef-fort is to extend another round ofgrant funding — estimated to beworth $1 million for two years —from the Robert Wood JohnsonFoundation’s Aligning Forces forQuality project, Kohn-Parrott said.

“We have to focus on access toappropriate care and health litera-cy more so with the employer be-cause they, like consumers, needto know how to use the health sys-tem better,” she said.

Kohn-Parrott

CON RoundupThe following are selected fil-

ings and decisions Sept. 1-30:Letters of intent:� St. Joseph Mercy Hospital, Ann

Arbor: Build a new surgical pavil-ion and replace nine operatingrooms, $29.3 million.

� St. Anthony Nursing Healthcare,Warren: Add 104 beds and lease anew, 33,000-square-foot buildingfor 15 years, $7.8 million.

� Lourdes Nursing Home, Water-ford Township: Construct newspace, renovate a current space,and move 50 of its 108 beds to thenew space, $15 million.

� Special Tree Macomb Center,Clinton Township: Build a 39-bed,45,000-square-foot nursing and re-habilitation center for traumaticbrain and spinal cord injuries, $9.8million.

� Regency on the Lake-Novi LLC:Build a 145-bed nursing home andlease for 15 years, $10.9 million.

� Regency at Waterford: Add 30nursing home beds to the 120-bedfacility and lease a newly con-structed, 30-bed wing for 15 years,$2.4 million.

Filings waived/not reviewable:� McLaren Medical Group, Inde-

pendence Township: Build 400,000-square-foot medical office build-ing, $303.7 million. (See Rumblings,Page 34.)

— Ryan Kelly


CRAIN'S LIST: LARGEST GROUP HEALTH CARE PLANS Ranked by 2011 revenue

Rank

CompanyAddressPhone; website Top local executive(s)

Revenue($000,000)2011/ 2010

Percentchange

Enrolledmembersyear-end

2011/2010

Enrolledmembers inHMO/DHMO

plan

Enrolledmembers

in PPOplan

Enrolledmembers in

POSplan

Enrolledmembers inother plans Name of group health care plans/types

1.Blue Cross Blue Shield of Michigan/Blue Care Network600 E. Lafayette Blvd., Detroit 48226(313) 225-9000; www.bcbsm.com

Daniel Loepppresident and CEO

$20,400.0 B

$19,200.0 B

6.3% 4,414,620 C

4,351,928 C

695,391 D 3,382,789 0 336,440 Simply Blue PPO, Healthy Blue Outcomes PPO, CommunityBlue PPO, Healthy Blue Incentives PPO, Blue Care Network ofMichigan HMO, BCN Healthy Blue Living, others

2.Priority Health34505 12 Mile Road, Farmington Hills 48331(800) 942-0954; www.priorityhealth.com

Michael Freedpresident and CEO

2,246.01,977.2

13.6 622,298610,000

362,290 53,954 3,137 202,917 PriorityPPO, PriorityPOS, PriorityHMO/PriorityEPO,PriorityValue, PriorityHSA, PriorityHRA, HealthbyChoiceIncentives, others

3.Health Alliance Plan of Michigan2850 W. Grand Blvd., Detroit 48202(313) 872-8100; www.hap.org

William Alvinpresident and CEO

1,791.31,733.4

3.3 420,965475,559

301,299 12,289 1,200 227,778 HMO, PPO, POS, EPO, Medicare, Wayne County Four Star,self-funded, Alliance Rx, Leased Network

4.Delta Dental of Michigan Inc.Farmington Hills and Lansing(517) 349-6000; www.deltadentalmi.com

Laura Czeladapresident and CEO

1,309.31,286.5

1.8 5,288,6815,245,361

NA NA NA NA Delta Dental Premier, Delta Dental PPO, DeltaCare

5.Meridian Health Plan of Michigan Inc.777 Woodward Ave., Suite 600, Detroit 48226(313) 324-3700; www.mhplan.com

Jon Cottonpresident and COO

960.6873.2

10.0 290,587281,078

290,587 0 0 0 Medicaid, Medicare HMO

6.HealthPlus of Michigan Inc.101 W. Big Beaver Road, Suite 1400, Troy 48084(248) 687-1420; www.healthplus.org

Bruce Hillpresident and CEO

772.5 E

695.7 E

11.0 212,616215,477

151,422 36,232 0 24,962 HMO, PPO, consumer-driven health plans

7.Molina Healthcare of Michigan Inc.100 W. Big Beaver Road, Suite 600, Troy 48084(248) 925-1700; www.molinahealthcare.com

Stephen Harrispresident

662.1630.1

5.1 222,000227,000

222,000 0 0 0 Medicaid, Medicare

8.UnitedHealthcare26957 Northwestern Hwy., Suite 400, Southfield 48034(800) 842-3585; uhc.com

Jelka PetrovicCEO, UnitedHealthcare inMichigan

366.0278.0

31.7 284,000269,000

NA NA NA NA Co-pay, HSA, high-deductible, short-term, student, DentalPremier, Dental Value, Medicare Advantage, Medicare HMO,Medicaid

9.McLaren Health Plan Inc.G-3245 Beecher Road, Suite 200, Flint 48532(888) 327-0671; www.mclarenhealthplan.org

Kathy Kendallpresident and CEO

311.1301.4

3.2 93,42791,918

NA NA NA NA HMO, POS, Medicaid

10.Midwest Health Plan Inc. F

4700 Schaefer, Suite 340, Dearborn 48126(313) 581-3700; www.midwesthealthplan.com

Mark Safferpresident and CEO

265.7248.5

6.9 75,04070,630

75,040 0 0 0 HMO

This list of leading Detroit-area group health care plans encompasses medical, dental, optical and other health care organizations. It is not a complete listing but the most comprehensive available. Humana Michigan, No. 8 on last year's list, which Crain's believeswould make the list, declined to provide figures, and a reliable estimate could not be made. Crain's estimates are based on industry analyses and benchmarks, news reports and a wide range of other sources. Unless otherwise noted, information was provided bythe companies or the Michigan Office of Financial and Insurance Regulation. Companies with headquarters elsewhere are listed with the address and top executive of their main Detroit-area office. Actual revenue figures may vary. NA = not available.B Total of premiums and premium equivalents that include both fully insured and self-funded business.C Does not include members that are part of Michigan-based groups but reside outside of Michigan.D Includes members belonging to Blue Care Network subsidiaries.E Figures include subsidiaries HealthPlus Insurance Co. (PPO), HealthPlus Partners (Medicaid) and HealthPlus Options (TPA).F Midwest Health Plan Inc. became a subsidiary of Health Alliance Plan of Michigan on Nov. 1, 2011.

LIST RESEARCHED BY BRIANNA REILLY


■ An expanded version of this list can be purchased at crainsdetroit.com/lists.

Presented by

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A. B.

PEOPLE

JobFrontCrain’s Job FrontVisit www.crainsdetroit.com/jobfront to search for jobs, post a résumé or find talent.

EDUCATIONBahman Mirshab to dean, College ofManagement, Lawrence Technologi-cal University, Southfield, from dean,Cameron School of Business, Univer-sity of St. Thomas, Houston. Also, JimJolly to director of leadership pro-grams, remaining adjunct professor.

FINANCEWilliam Brickey to partner, PlanteMoran PLLC, Southfield, from associ-ate. Also, Nathan Buchalski to part-ner, Ann Arbor, from associate; MarkCorombos to partner, Auburn Hills,from associate; and Scott Eiler to part-ner, Southfield, from associate.

HEALTH CARELisa Mason to vice president of costquality, Greater Detroit Area HealthCouncil, Detroit, from director of costquality. Michael Smith, D.O., to chief medicalofficer and vice president of medical af-fairs, St. Joseph Mercy Oakland, Ponti-ac, from vice president of medical af-fairs and chief medical officer, MountClemens Regional Medical Center.Also, Wilbur Smith Jr., M.D., to directorof medical education, from professorand chair of the department of diagnos-tic radiology, Wayne State UniversitySchool of Medicine, Detroit.

INFORMATION TECHNOLOGYSusan Lines tovice president ofoperations,Saphran Inc.,Franklin, from se-nior manager, T-Systems NorthAmerica Inc.,Rochester Hills.

LAWHarvey Weingar-den to partner,

Lippitt O’Keefe PLLC, Birmingham,from attorney, Cohen Lerner and Ra-binovitz PC, Royal Oak. Jason Mathers to shareholder, HarveyKruse PC, Troy, from associate. Also,Stephanie Marino Anderson to share-holder, from associate.

MARKETINGPatricia Adanti-Joy to accountmanager, FrancoPublic RelationsGroup, Detroit,from public rela-tions manager,Walter P.Chrysler Muse-um, Auburn Hills. Allison Hurt to di-rector of socialmedia, TheBerline Group

Inc., Bloomfield Township, from so-cial media account executive. Joshua Williams to president, WarrenStrategies Inc., Southfield, from salesmanager, Weldaloy Products Co.,Warren.

NONPROFITSDavid Newman to legislative director,The Economic Alliance for Michigan,Novi, from director of government af-fairs, Michigan Department of Technol-ogy, Management & Budget, Lansing.

STEELJames Gray to general manager, GreatLakes Works, United States SteelCorp., Ecorse and River Rouge, fromplant manager, primary operations,Gary Works, United States SteelCorp., Gary, Ind.

DISTRIBUTIONJames Fiene to ex-ecutive vice presi-dent of retail op-erations, Atlas OilCo., Taylor, fromCOO, OpenPantry FoodMarts of Wiscon-sin Inc., PleasantPrairie, Wis. Fiene

Lines

Adanti-Joy

Frier

IN THE SPOTLIGHTThe UAW Retiree Medical Benefits Trust,Detroit, has named Kenneth Frier CIO. He hadbeen CIO of the Stanford Management Co.,which invests and manages the endowmentand other financial assets for StanfordUniversity, Stanford, Calif.Frier, 54, succeeds Eric Henry, who now isCEO and CIO of the Milton Hershey SchoolTrust, Hershey, Pa.

Frier earned a Bachelor of Science degree inmathematical science with a computerscience emphasis from The University of NorthCarolina at Chapel Hill and an MBA from theStanford Graduate School of Business.The benefits trust provides access to healthbenefits for 840,000 General Motors Co.,Chrysler Group LLC and Ford Motor Co. hourlyretirees.


focus on electric vehicles and fuelcell development. GM has beentesting fuel-cell vehicles that run

on hydrogen with no harmfulemissions

— Associated Press

General Motors said Friday itwill close its hydrogen fuel-cellresearch operation nearRochester, N.Y., and move it toMichigan, along with most ofthe 220 salaried jobs currentlyin New York.

The company said most of the 220 salaried workers in Honeoye Falls, N.Y., will beoffered the chance to move to GM’s engine and transmission research unit inPontiac.

Spokeswoman KimberlyCarpenter said the move willpull together all of its expertson ways to move vehicles. Thecompany will save some mon-ey by not renewing a buildinglease in New York.

She says GM will continue to

The Wixom City Council is ex-pected Tuesday to consider a re-quest from Ford Motor Co. to splitthe Wixom Assembly Plant land toenable the sale of a portion of itto Menard Inc., the home im-provement and home goodsstore.

Approval from the councilwould enable an agreement between Ford and the Eau Claire,Wis.-based chain to go forward.

“Menard has communicated tothe city that they’ve entered an

agreement with Ford to purchase45 acres,” Wixom Mayor KevinHinkley told Crain’s late lastweek.

Menard has asked Ford to tryto have the demolition on the 280-acre site completed by March, hesaid.

Menard is expected to submit a site plan to the city for a store on 15 acres of the land itpurchases, once the council ap-proves the land split, Hinkleysaid.

Typically, the chain establish-es a footprint for its stores andsells adjacent outlots to gas sta-tions, restaurants and other re-tailers to bring more customersto the site.

Menard is not seeking any taxrelief from the city at this time,Hinkley said.

The company has said thestore, which it would like to haveopen by January 2014, could cre-ate 65 to 110 jobs, he said.

— Sherri Welch

ity ownership in Century PlasticsInc., a Shelby Township-basedsupplier of injection- and com-pression-molded auto parts.

CPI is becoming part of a plas-tics auto supply firm, with fourfactories in Brazil and one inMexico.

The company sold a 65 percentstake, according to Lincoln Interna-tional LLC, a Chicago-based con-sulting firm that assisted CPIwith the deal.

Autometal, of Diadema, Brazil,is itself a subsidiary of Spain’s CIEAutomotive SA, which has addi-tional plastics operations inSpain, Portugal, the Czech Repub-lic, Russia and China. The globalcompany, with headquarters inBilbao, has an engineering officein Livonia, but CPI will be its firstproduction site in the UnitedStates.

In addition to plastics, CIE Au-tomotive and Autometal supplymetal and painted automotiveparts.

Their plastics operations sup-ply a variety of interior and exte-rior trim using injection molding,vacuum forming, multishot mold-ing and gas-assist molding.

From Plastics News

BY RHODA MIEL

CRAIN NEWS SERVICE

Brazilian auto supplier Au-tometal SA has purchased a major-

BY RHODA MIEL

CRAIN NEWS SERVICE

Guardian Industries Corp., theparent company of injectionmolder SRG Global Inc., hasagreed to sell a minority interestto a subsidiary of Koch IndustriesInc.

Guardian, based in AuburnHills, would sell part of its sharesto KGCI LLC, a Wichita, Kan.-basedunit of Koch.

Koch’s other investments in-clude ownership of Georgia-PacificCorp. of Atlanta, which makeswood products used extensivelyin the construction industry.

Guardian’s major business isin glass used in the constructionand auto industries.

SRG is a subsidiary that spe-cializes in plated plastics for autotrim.

The deal is scheduled to closeby the end of this year, Guardiansaid in an Oct. 4 news release.

Ratings analysts with bothMoody’s Investors Service and Stan-dard & Poor’s Financial Services LLCplaced Guardian on ratingswatch for review with negativeimplications following the an-nouncement.

Moody’s said its review will fo-cus on the potential for capitalstructure changes, potentialstrategic changes and Guardian’sliquidity profile. Moody’s cur-rently rates Guardian as Baa 1/P-2, noting its historically low debt-to-capitalization ratio,conservative financial policies,global diversification and strongmarket placement.

From Plastics News

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Koch buys stake in Guardian

Wixom asked to split Ford plantland to make space for Menard

Is state businessfriendly? Surveyseeks to find out

BY TOM HENDERSON


A statewide survey of some 70business organizations, nonprofitorganizations and municipalgroups by the Baker Strategy Groupof Ann Arbor, quantifying percep-tions of Michigan as a business-friendly state, will be unveiled inearly January.

Organizations agreeing to partic-ipate include the Detroit EconomicClub, the Detroit Regional Chamber,the Grand Rapids Area Chamber,Michigan Manufacturers Association,the West Michigan Policy Forum, theTraverse City Area Chamber and LakeSuperior Community Partnership.

The survey will begin on Nov.12, timed to follow the fall election.

“This post-election start date isimportant because all federal,state and local races will be overand we will know where we standon the six ballot proposals,” saidDavid Baker, managing partner atthe Baker Strategy Group.

“Regardless of the outcome ofthe election, the question for us allwill be, ‘What can we do going for-ward to build a better Michiganeconomy?’ The Michigan 2013Economic Outlook Survey willhelp turn our attention to the com-mon goal of strengthening theMichigan economy,” he said.

“This highly collaborative effortwill generate a wealth of insight onMichigan’s outlook. We will becapturing real-world opinionsfrom more than 5,000 people inbusinesses, nonprofits and munic-ipal government throughout thestate.

“Michigan can really benefitfrom a survey of this breadth, andconducting it after the election isperfect timing,” said Sandy Baru-ah, president and CEO of the De-troit Regional Chamber.

Associations throughout Michi-gan will send surveys to theirmembers on Nov 12. The surveywill remain open through Dec. 7,with a final report distributed pub-licly on Jan. 7, 2013.

Brazil supplier buys majority stake in Shelby Twp.’s Century Plastics

GM bringing fuel cell research, jobs to Michigan from NY


with the restaurant,” Kleiner said.“Initially, they were using my nameto put the concept together, but I amofficially not on any paper.”

However, Hawkins said Kleineris the lease holder for Detroit’sCheesecake Bistro and said thebuild-out for the restaurant costKleiner and Tomkin about $2 mil-lion. The landlord is GreektownCasino; Greektown representativesdidn’t return calls.

Hawkins said he and Kleinerown three restaurants together, in-cluding the popular Carnivale inChicago. Hawkins said he andKleiner are also co-owners of arestaurant management companycalled Global Hospitality Group LLC.

“He calls himself the MagicMan, but I am the Magic Mannow,” Hawkins said.

Giving away … or selling?The restaurant, located in the

former Sweet Georgia Brown at1045 Brush St. next to GreektownCasino, is, despite its name, actual-

ly a full-service restaurant with adiverse menu. It’s been open spo-radically since the VIP party, giv-ing away two complimentarydrinks with the purchase of an ap-petizer or entrée.

As long as those drinks are be-ing given away to invited guests,that’s legal, but alcohol can’t besold or given away to the generalpublic without a license.

“There is no prohibition aboutfurnishing alcohol at a privatefunction like a wedding or a privatereception at a restaurant where aninvite is required,” said PatrickHowe, liquor license and hospitali-ty attorney with Royal Oak-basedHoward & Howard Attorneys PLC.

“But the minute the event isopen to the public and there is acost associated, like a cover chargeor a charge for food where alcoholis included, it violates the Michi-gan Liquor Control Code, which isa felony offense.”

Hawkins said the restaurantwasn’t officially open until Thurs-day at 5 p.m. and anyone served be-

fore then was there by invitationand did not pay for meals.

“I have been having taste test-ings,” Hawkins said. “Our conceptwas, from the standpoint of who wehad in the restaurant for the tast-ings, as long as you are not sellingthe alcohol, it’s OK to give it away.”

The bistro serves moderatelypriced American fare such aslumb crap and shrimp cakes andhoney cajun roasted chicken.

Hawkins said he expects therestaurant to get a liquor license,which according to state recordshas been in escrow since 2009,sometime this week.

And he said he understands howpeople could be confused.

“People would think we wereopen because they would see 50 or60 people here, but no one was pay-ing for food,” he said.

Tom Schoenith, owner of TheRoostertail, said he has been to De-troit’s Cheesecake Bistro twice:once for the VIP event and again thenext evening with his great-nephew.

Schoenith said he ordered the

filet mignon and a martini. “I thought it was very nice, both

times I was there,” Schoenith said.“The service was great.”

Schoenith said his great-nephewpicked up the $100 tab.

License not issued?An employee for the city of De-

troit’s Business License Center saidthat as of Friday, there has notbeen a business license issued forthe restaurant’s address and saidit was illegal for a restaurant to beoperating there.

But Hawkins said that’s anothermisunderstanding.

“What happened was the healthdepartment looked at this as if itwas a brand-new restaurant and itwas not because the facility wasstill here,” Hawkins said. “We gota letter of acceptance so we didn’tneed a certificate of occupancy.”

He said the health departmentsigned off on the restaurant Thurs-day.

A food-filled pastHawkins was a founding owner

of Sweet Georgia Brown until a2006 ownership change and therestaurant’s closure in 2009.

Already established as a fast-food franchise owner, Hawkinsfirst emerged on the Detroitrestaurant scene in 1998 when hebought 89 Detroit-area Pizza Hut lo-cations. He sold the restaurants,operated under Wolverine Pizza LLC,for more than $95 million.

Hawkins sued Burger King in 2000for backing out of a commitment toallow him to develop 125 restau-rants in urban areas; that case wassettled for about $30 million.Hawkins Food Group had been a fran-chisee of Pizza Hut, Burger Kingand Perkins Family restaurants.

While he was preparing to sellSweet Georgia Brown, Hawkinswas convicted by a jury in Philadel-phia on wire fraud stemming froma pay-for-play scandal in that city.He was sentenced to 33 months.

In a separate 2008 case in De-troit, U.S. District Judge DenisePage Hood ordered Hawkins to payrestitution of up to $5.7 million andserve 10 months concurrent withhis federal prison sentence. Thatwas over a charge of failing to payfederal withholding and FederalInsurance Contributions Act taxes.

Court fights aheadHawkins is currently fighting

two lawsuits in Cook County Cir-cuit Court of Illinois.

Tonya Van Dyke and her hus-band, Darnell Johnson, co-ownersof Chicago-based VFJ EnterprisesInc. d.b.a. Chicago’s Home of Chickenand Waffles, filed a lawsuit in No-vember against Hawkins andKleiner for two counts of breach ofcontract, tortuous interferencewith prospective economic advan-tage, and breach of fiduciary duty.

They are asking the court to setdamages on the two counts ofbreach of contract and are seekingdamages of $21 million for the oth-er charges.

The lawsuit alleges that Hawkinsapproached Van Dyke and Johnsonwith promises of turning theirrestaurant into a national chainthat would eventually become pub-licly traded and valued at $1 billion.

The suit alleges that Hawkinssaid he would withhold $20 millionin funding unless Van Dyke andJohnson gave him their recipe forwaffle mix and syrup to use in De-troit’s Cheesecake Bistro, whichthen had the working name of L’sCheesecake Bistro.

The lawsuit also alleges Hawkins,after learning from Johnson about apotential new site for another Chica-go’s Home of Chicken and Waffleslocation, began negotiating for thesite for his own development.

Hawkins and Kleiner deny theallegations and the lawsuit ispending.

The second lawsuit, filed inJune by Ohio-based Cadlerock JointVenture LP, alleges Hawkins has de-faulted on $5.85 million in promis-sory notes to J.P. Morgan ChaseBank. The suit is pending.

Beyond the BistroIn the meantime, Hawkins has

plans. He said Detroit’s Cheesecake

Bistro will serve as a trainingground for the management team ofGlobal Hospitality Group, which hesays will run the 12 restaurants hehas planned for downtown Detroit.

Those restaurants include: Carni-vale, based on the Chicago restau-rant; Soul Daddy, a white-tableclothrestaurant in Paradise Valley; a re-ported Michael Jordan’s Steak Houseand an Italian restaurant calledTucci Milan in Greektown; and TheCotton Club, named for the Harlemjazz club, at 1541 Griswold St.

“Detroit is a city that has a spiritthat won’t die and specializes incomebacks,” Hawkins said.“There is a huge opportunity inDetroit right now.”

Nathan Skid: (313) 446-1654,[email protected]. Twitter:@nateskid


Bistro: Restaurant opens with Hawkins, no liquor license■ From Page 1

JOIN CRAIN’S IN HONORING 40 UNDER 40 WINNERSMeet Crain’s 2012 class of 40Under 40 at an upcoming Oct. 24awards event.This year’sawards eventwill be from5:30-9 p.m.at ShrinersSilver GardenEventsCenter in Southfield.Hundreds of alumni have beeninvited. Tickets are $50 per personfor Crain’s subscribers; $45 each

for groups of 10 or more; $40 foralumni and $90 for nonsubscribers.See www.crainsdetroit.com/events

for details orto buytickets.To readprofilestories, viewphotos and

videos of this year’s winners, seewww.crainsdetroit.com/40s. Crain’s has presented the awardssince 1991.


has 13 employees, including 10 in-vestment professionals.

Elkins said that while colleaguesin New York warned him he wouldbe hurting his career by taking a jobin Detroit, “I’d rather be in a placewhere I’m not just a guy writingchecks. Here, I’ll have the chance tobe a lot more operational. And, cul-turally, Rockbridge is different fromanything I’d seen in New York.”

Kaczmarek grew up on GrosseIle, and he and his wife were look-ing to move back to the Midwest.He said he had job offers in Chica-go and Minneapolis but after a vis-it to the Rockbridge offices, “I saidto my wife, ‘Let’s not choose Chica-go, let’s move to Detroit.’ Therewas an energy here.”

Tom Henderson: (313) 446-0337,[email protected]. Twitter:@tomhenderson2

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Unlike many private equitycompanies, Rockbridge does nothave a dedicated investment fundbut raises money on a deal-by-dealbasis from wealthy individualsand families.

Boston-based Falcon InvestmentAdvisors LLC, which is reported tobe raising a fourth fund of $850million, is in the midst of codifyinga relationship with Rockbridge tolet Falcon have first crack at co-in-vesting in its deals, according toJohn Schnabel, a managing direc-tor at Falcon. Falcon has investedin five of Rockbridge’s deals.

“We like these guys a lot,” saidSchnabel. “They know their nicheof direct-to-consumer businesses,and they can tap into a top manage-ment network to bring into theircompanies unlike anyone else.”

Typically, Rockbridge invests$15 million to $35 million in well-run companies that have between$5 million and $25 million in EBIT-DA (earnings before interest, tax-es, depreciation and amortiza-tion), need capital to grow, andoften need help rounding out theirmanagement teams.

The first deal Falcon invested inwas Rockbridge’s second: Arizona-based Northcentral University Inc.,which offers online graduate de-grees. The deal closed on Dec. 31,2008.

“In our last fund, we did fivedeals with them. So it’s safe to saywe would do another five or sixdeals with them out of a largerfund,” said Schnabel, who said thatFalcon typically invests a mini-mum of $20 million in each deal,and up to $60 million. “We want to

take a first look at their deals.They’ll show us a deal first, andwe’ll give them a quick ‘yes’ or ‘no’on whether or not we want to do it.”

U.S. Securities and Exchange Com-mission rules prohibit Schnabelfrom disclosing the new fund’stargeted size during fundraising,but Buyouts, an online publica-tion of Thomson Reuters, wrote onSept. 17 that according to theLouisiana Teachers Retirement Sys-tem, which has agreed to invest$50 million in the new fund, it istargeting $850 million.

Falcon raised almost $1.4 billionin its first three funds.

Rockbridge, which is headquar-tered in the Compuware Building,

Rockbridge: $100M committed for deals■ From Page 3

ROCKBRIDGE PORTFOLIORockbridge Growth Equity LLC hasseven portfolio companies:� One Reverse Mortgage LLC, SanDiego, which employs about 150locally� Northcentral University, aPrescott Valley, Ariz.-based providerof online graduate degrees� AccountNow Inc., San Ramon,Calif., which offers prepaid creditcards� Protect America Inc., a homesecurity and monitoring companyin Austin, Texas� One on One Marketing LLC, Lehi,Utah, an interactive marketingcompany� Connect America LLC, Broomall,Pa., which sells medical-alertdevices� Purchasing Power LLC, Atlanta,which manages employee-purchase programs.

up of more than 700 Beaumont em-ployed physicians, and maintainour efforts to engage and alignwith our private practice physi-cians.”

United Physicians offers supportand management services to its1,800 physician members who areon the medical staffs of Beaumonthospitals and other competing hos-pitals that include Detroit MedicalCenter, Oakwood Healthcare Systemand Henry Ford Health System.

United Physicians also has anHMO contracting company calledPremier Physicians Network that rep-

resents physicians in managedcare negotiations.

When the merger is complete,United Physicians is expected tobecome Southeast Michigan’slargest physician organizationwith more than 2,600 physicians,Williams said.

St. John Providence HealthPartners,Warren, is the largest physician or-ganization with 2,211 physicians,according to Crain’s 2012 physicianorganization survey.


Doctors: Largest group■ From Page 3

Ford Arts, Beats & Eats raisedabout $1.9 million this year, withmore than $337,000 of that going tobenefit 60 local charitable and cul-tural groups.

The amount raised for nonprof-its was up more than 28 percentover last year.

It was the second-highestamount raised for nonprofits overthe festival’s 15 years of operation,said festival producer Jon Witz ofArts, Beats and Eats Inc. The moneyto support those organizationscame from gate admissions, bever-age sales, the Arts Du Jour charity

preview event, parking revenueand special festival-sponsored

community ini-tiatives such asradiothons, afood drive and a5K run/walk.

About 390,000people attendedthis year’sevent, whichtook place overLabor Dayweekend. That

was up from 335,000 in 2011, ac-cording to organizers.

The presenting sponsor was Citi-zens Bank.

Operating on a $1.8 million bud-get, the festival met costs with anexcess of approximately $100,000,Witz said.

The 2012 event had a total esti-mated economic impact of about$35.1 million, organizers said,based on the Michigan tourismspending and economic impactmodel developed for Travel Michi-gan and the state’s tourism indus-try.

— Sherri Welch

Arts, Beats & Eats raises more for nonprofits

Witz


through the joint ventures —which the majority stakeholderwould operate, Bigatti said.

He said Posco’s remaining a mi-nority stakeholder would keepday-to-day operations in the handsof the partner company and elimi-nate an added burden to Poscomanagement.

“We want to be enablers, notrunning the company,” Bigattisaid. “A larger stake requiresmore capital and inhibits our abil-ity to create more ventures.”

Posco is already negotiatingwith suppliers in Southeast Michi-gan and Indiana, including an elec-tric vehicle motor manufacturerand a battery supplier, he said.

The estimated 200 joint venturesare projected to employ a mini-mum total of 2,000 and would sup-ply large parts makers and au-tomakers, among other originalequipment manufacturers.

The steelmaker also seeks com-panies looking to bring productionback to North America as“reshoring” continues, Bigattisaid.

“We’re finding that the incre-mental benefit of overseas produc-tion is offset with complicationsfrom freight and logistics costs,”he said. “More and more manufac-turers are wanting to come back toNorth America, and we can offerthem the best of both worlds: to beback manufacturing in NorthAmerica and very direct access up-stream to the supplier of their rawmaterial and access to capital as apartner.”

The aggressive joint venturestrategy is designed to increasePosco’s revenue by 220 percent to$200 billion globally by 2020 from$62.2 billion with net income of$3.3 billion in 2011.

Bigatti said the company ex-

pects North America nonsteel au-tomotive revenue to reach $500million by 2015 from $200 millionthis year. Total North Americanrevenue is projected to rise to $5billion by 2020 from $1 billion in2012, he said.

Posco is not limiting the jointventures to just automotive orSoutheast Michigan, Bigatti said.But many would be organized withsuppliers here because of the re-

gion’s strong automotive concen-tration. Bill Wildern, CEO of theFarmington Hills-based financialadvisory firm Hydra ProfessionalsLLC, said creating joint ventures toaccess technology is a safe movefor Posco.

“If they’re really good at produc-ing a commodity, providing anoth-er supplier with the commodity inexchange for the technology, creat-ing joint ventures makes sense —instead of swallowing up entirecompanies and creating a compa-ny outside of your core competen-cies,” Wildern said.

Owning portions of your supplybase is a strategy — called keiretsu— that has been used for centuriesin Japan. For instance, ToyotaGroup, the conglomerate tied to Toy-ota Motor Corp., owns majority

stakes in several companies, in-cluding Aichi Steel Corp., supplierAisin Seiki Co. Ltd. and Denso Corp.

“The keiretsu system is well-es-tablished in Japan,” Wildern said,“and for a large conglomerate likethis (Posco), it really opens upchannels for their product. Thistype of strategy can lead to an ex-pansion in their revenues and nota bad way to go after an expan-sion.”

Bridget Freas, a senior equityanalyst covering the metals mar-kets for Chicago-based MorningstarInc., said vertical integration isemerging as a trend among steel-makers. Posco is going in a differ-ent direction by acquiring assetson the end-product side.

“Vertical integration has been ahot topic in steel, but that has been

mostly upstream (mining andscrap recycling) for raw materials,not downstream into the end mar-kets,” Freas wrote in an email.“But I can’t imagine too manystructural JVs will be formed be-cause automakers (and otherOEMs) likely won’t want to tiethemselves to only one” overarch-ing supplier.

Posco supplies engine and trans-mission parts to General Motors Co.and Chrysler Group LLC; seatingcomponents and aluminum andsteel wheels to Ford Motor Co. andChrysler; and textiles to GM.

It also operates an aftermarketbusiness selling wiper blades,commercial-vehicle tires, steeringand suspension components andbatteries, among other products.

Posco operates one whollyowned plant in the U.S. — a steel-processing plant in McCalla, Ala.— and two in Mexico. It also oper-ates a 50-50 joint venture in Pitts-burg, Calif., with U.S. Steel Corp. —USS-Posco Industries — that sup-plies the oil and gas industry.

Posco employs 23 at its Troy of-fice and 70 in North America, ex-cluding USS-Posco and its process-ing plant.

Under Daewoo International,Posco also exports coal from theU.S. to Russia, Bigatti said.

Globally, Posco employs 34,936and is the 146th-largest companybased on revenue, according toFortune’s Global 500 list.

Posco completed seven similarjoint ventures in Asia over thepast year and plans to add twomore in China this month, Bigattisaid. The ventures manufacturechassis, wiring and high-perfor-mance components.

Dustin Walsh: (313) 446-6042,[email protected]. Twitter:@dustinpwalsh


A SEOUL PROPRIETOR� Name: Posco Ltd. (formerlyPohang Iron and Steel Co.)� Headquarters: Seoul, SouthKorea� Employees: 34,936� CEO: Chung Joon-Yang� 2011 revenue: $62.2 billion� 2011 net income: $3.3 billion� Local presence: Posco/DaewooInternational office in Troy

POSCO’S PLANSFacts about Posco Ltd.’s jointventure initiative:� Plans to spend minimum of $2 billion to create up to 200 jointventures.� Seeks no more than 20 percentstake in each.� Seeks JV partners with motor,chassis and other componentsuppliers, as well as otherindustries. � Many auto partners will bebased in Southeast Michigan.� JVs will create a minimum of2,000 jobs total. � Plan is part of growth initiative toraise global revenue to $200billion by 2020.� North American nonsteelautomotive revenue projected toreach $500 million by 2015 from$200 million in 2012.

proved their processes and arehelping to revitalize this state’seconomy,” Anderson said.

DTE’s Michigan-based suppliersinclude companies in a variety ofindustries, including construc-tion, maintenance, staffing, engi-neering, energy optimization, re-newable energy, natural gasstorage and information technolo-gy consulting.

Two companies reaping the ben-efits of DTE’s new purchasingstrategy are Southfield-based Bar-ton Malow Co. and Detroit-basedStrategic Staffing Solutions Inc.

“Our relationship has grownand developed over the past 21years with DTE, especially the lastyear,” said Cynthia Pasky, Strate-gic Staffing’s CEO. “They haveasked us, ‘What else do you do forcustomers in Michigan that weshould know about?’ ”

Pasky said that last year Strate-gic Staffing signed a third contractwith DTE for customer serviceconsulting services that led to thecompany hiring another 100 em-ployees, 70 percent of whom are inDetroit. She declined to reveal thevalue of the contract.

“We anticipate even more busi-

ness with them,” said Pasky,adding that the company has oneoutstanding bid with DTE for acompletely new service line. Shesaid the bid is confidential.

Chuck Binkowski, Barton Mal-ow’s vice president of project de-livery in the central region, saidthe construction company has hada long history of working withDTE on heavy concrete and civilengineering projects, including en-vironmental work at the MonroePower Plant.

“We have been able to showthem the diversity of capabilitiesthat Barton Malow has to offerthem,” Binkowski said. “DTE real-ized we have a strong interiorbuild-out division.”

For example, Barton Malow isfinishing an office renovation onthe ninth floor of DTE’s corporateheadquarters in Detroit.

Over the last five years,Binkowski said, the revenue valueof DTE’s contracts with BartonMalow has increased by 40 percent.The extra work has generated sev-eral hundred union jobs, he said.

“When our work slowed at Mon-roe, we rotated over to doing thewind farms DTE is developing inthe Michigan Thumb,” saidBinkowski, adding that the compa-ny is constructing roads, concretefoundations and erecting wind tur-bines for the DTE project.

Last week, DTE issued a requestfor proposals to purchase larger

solar photovoltaic facilities thatrange in size from 500 kilowatts to2 megawatts for its utility-ownedSolarCurrents program, said TomKomjathy, DTE renewables pro-gram manager.

The first round of bids is to iden-tify sites. Bids are due Dec. 21,with preference given for locationsin Detroit, Komjathy said.

He said DTE doesn’t have an es-timate on how much it plans tospend on the SolarCurrents pro-jects, but there will be Michigancompanies bidding for the con-tracts.

So far, DTE has eight solar pro-jects generating clean energy withanother five or six with 100 to 500kilowatts coming online this year.Those projects will generate about3 megawatts toward its goal of 15megawatts by 2015. Another 5megawatts is generated from cus-tomer-owned solar plants, he said.

“About 90 percent of our renew-able energy will come from wind,with about 2 percent coming fromsolar,” Komjathy said.

DTE owns and operates severallarge solar installations, includingprojects at Monroe County Communi-ty College, General Motors’ Detroit-

Hamtramck Assembly Plant, Ford Mo-tor Co.’s Wayne Assembly Plantand Blue Cross Blue Shield of Michi-gan’s downtown Detroit parkinggarage.

Komjathy said next month DTEplans to open an 80-kilowatt solararray at its parking lot for itsdowntown Detroit offices.

Tomczak said DTE is also hiringMichigan companies for work out-side of Michigan. He said severalMichigan companies, which hewould not name, are helping DTEbuild gas pipelines in Pennsylva-nia.

Binkowski said Barton Malowhas bid for some contracts outsideof Michigan in its engineering ser-vices division, but he could notprovide further information be-cause of a confidentiality agree-ment.

“There is a strong desire andcommitment to do more in Michi-gan, and our suppliers here — newor older ones — are beginning tobranch out in areas they didn’thave before and are wanting to sellto us,” Tomczak said.


GLENN TRIEST

Posco: Steelmaker wants a piece of up to 200 auto suppliers■ From Page 1

DTE: Spending push strives to meet renewable energy goal■ From Page 3

We want to be enablers, not running the company.

Steven Bigatti, Posco Ltd.”

“

(DTE has) asked us, ‘Whatelse do you do for customers inMichigan that we should know

about?’Cynthia Pasky, Strategic Staffing Solutions Inc.

”

“



www.crainsdetroit.comEDITOR-IN-CHIEF Keith E. CrainPUBLISHER Mary Kramer, (313) 446-0399 [email protected] PUBLISHER Marla Wise, (313) 446-6032 or [email protected] EDITOR Cindy Goodaker, (313) 446-0460 or [email protected] EDITOR Jennette Smith, (313) 446-1622 or [email protected], DIGITAL CONTENT STRATEGY NancyHanus, (313) 446-1621 or [email protected] DEPUTY MANAGING EDITOR Daniel Duggan, (313)446-0414 or [email protected] EDITOR Bob Allen, (313) 446-0344 [email protected] MICHIGAN EDITOR Matt Gryczan, (616) 916-8158 or [email protected] EDITOR Gary Piatek, (313) 446-0357 [email protected] DESIGNER Jeff Johnston, (313) 446-1608or [email protected] EDITOR Brianna Reilly, (313) 446-0418,[email protected] PRODUCER Norman Witte III, (313) 446-6059, [email protected] SUPPORT Robertta Reiff, (313) 446-0419; YahNica Crawford, (313) 446-0329NEWSROOM (313) 446-0329, FAX (313) 446-1687 TIP LINE (313) 446-6766

Daniel Duggan, deputy managing editor: (313)446-0414 or [email protected] Greene, senior reporter: Covers health care,insurance, energy utilities and the environment.(313) 446-0325 or [email protected] Halcom: Covers litigation, higher education,non-automotive manufacturing, defensecontracting and Oakland and Macomb counties.(313) 446-6796 or [email protected] Henderson: Covers banking, finance,technology and biotechnology. (313) 446-0337 [email protected] Shea, enterprise editor: Covers media,advertising and marketing, the business of sports,and transportation. (313) 446-1626 [email protected] Skid, multimedia editor. Also covers thefood industry and entertainment. (313) 446-1654,[email protected] Walsh: Covers the business of law, autosuppliers and steel. (313) 446-6042 [email protected] Welch: Covers nonprofits, services, retailand hospitality. (313) 446-1694 [email protected]

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enue stream that will allow it topay for several huge contracts onthe order of Verlander, Cabreraand Fielder’s,” said Gary Gillette,the Detroit-based author, co-editorof the ESPN Baseball Encyclopediaand board member of the Societyfor American Baseball Research.

“The Tigers also can afford toround out the club with well-paidveterans at other positions when itmakes sense. That is, they don’thave to load up with minimum-wage rookies or low-paid playerswith only a little big-league experi-ence in order to afford the big pay-checks that their superstars earn.”

Detroit committed $134.4 millionto player contracts by Opening Day(which includes salaries and sign-ing bonuses, according to trackingdone by BaseballProspectus.com).

Payroll concerns were largelytheoretical since there has been noevidence ownership cannot affordto sustain its spending. Ilitch-owned companies generate morethan $2.4 billion in annual revenue,and some of that cash is believed tosubsidize Tigers operating lossesreported by Forbes.com. The Ilitchfortune stems largely from the fam-ily’s Little Caesars pizza chain.

Financial specifics on the TVdeals haven’t been disclosed bybaseball or the networks, but de-tails have been leaked to mediaoutlets and baseball insiders.

Revenue gains“With MLB’s national media

rights revenues part of the league’scentral funds that are distributedevenly to all 30 clubs, each one willsee $50 million annually, or an ad-ditional $26.28 million each yearover the $23.72 million they nowsee,” wrote Maury Brown, presi-dent of Portland, Ore.-based Busi-ness of Sports Network.

A source familiar with the dealstold Crain’s on the condition ofanonymity that the contracts basi-cally ramp up payments immedi-ately in 2014 rather than gradually.

Last week, baseball announcednew eight-year broadcast rightsdeals with Atlanta-based TurnerBroadcasting System Inc. and LosAngeles-based Fox Sports MediaGroup that run through 2021.

Under the new deal, TBS willpay an estimated $325 million an-nually, up from its current yearly$148.6 million rights fee. That’s atotal of $2.6 billion for the contract.

Fox will up its average annualrights fee to $495 million, The NewYork Times reported, for a total of$3.9 billion over eight years. Thecurrent contract has the News Corp.-owned network paying $306 million.

Baseball inked an eight-year re-newal with ESPN in August thatmore than doubled the old deal($306 million) to $700 million. Thecontract, worth $5.6 billion, alsoruns through 2021.

All three deals begin in 2014.The combined annual rights fees

will increase to $1.5 billion annual-ly from the current $711 million.Baseball will collect $12.1 billionover the life of the deals, up fromthe current $5.6 billion.

Tigers TV money potThe Tigers also get about $50

million a year from a 10-year con-

tract signed with Fox Sports De-troit in March 2008 — a deal thatblossomed this year as the networksaw record-setting ratings that ledall of baseball for local viewership.

Here’s how the Tigers’ estimat-ed TV revenue is calculated:

� $50 million from the nationalbaseball deals.

� Sources familiar with the dealhave told Crain’s that the team re-ceives $50 million annually from a

10-year contract signed with FoxSports Detroit in March 2008 tobroadcast 148 of the team’s 162games.

� However, Detroit doesn’t getto keep all of its local TV money: Aportion of local broadcast rightsfees — believed to be about 31 per-cent — goes into baseball’s rev-enue-sharing pool, which was re-portedly $400 million in 2011. Sothat drops Detroit’s FSD money to

about $35.5 million annually.� The Tigers get back their por-

tion of the Central Fund TV money.Based on last year’s $400 millionpool, that refund would be between$13 million and $14 million.

Baseball teams also see local rev-enue from ticket sales, concessions,merchandise, parking and otherstreams, such as from the CentralFund. Estimates on that total Cen-tral Fund share were unavailable.

The Tigers had $8.2 million inoperating income last season onrevenue of $217 million,Forbes.com estimated this year.That was after three straight sea-sons of operating losses, the finan-cial website said.

“With the club going to the post-season in 2012, Detroit will profithandsomely in 2013 and 2014. And,unless the Tigers get blown outearly in October this year, the 2012postseason will provide a nice lit-tle windfall at the end of a prof-itable year,” Gillette said.

Bill Shea: (313) 446-1626,[email protected]. Twitter:@bill_shea19

Tigers: New TV deals should cover paychecks■ From Page 1

SHARED MONEYMajor League Baseball’s Central Fund is a pool of revenue from severalsources that is apportioned equally among the 30 teams. It’s separatefrom MLB’s revenue sharing system, which transfers payments from high-revenue teams to low-revenue franchises. Baseball doesn’t disclose thefinancial details of either system. These are the revenue sources that fuelthe Central Fund:

Miguel Cabrera may have wonthe first baseball Triple Crown in45 years, but that doesn’t neces-sarily mean you’ll see his face be-come ubiquitous on cereal boxesor TV commercials.

The Venezuela-born Cabrera —the slugging De-troit Tigers thirdbaseman — foryears has beenone of baseball’spremier hitters,but that’s nevertranslated intomass-marketmerchandisingappeal.

Sports indus-try marketers theorize that Cabr-era’s recent history of questionablepersonal behavior and his limitedcommand of spoken English mayhave limited his attractiveness tobrands — or that he just may nothave been interested in such deals.

Cabrera, 29, is expected to earna tidy sum as the first winner inalmost two generations of theTriple Crown — which he won byleading the American League inbatting average (.330), home runs(44) and runs batted in (139).

“From a memorabilia stand-point, he’s going to cash in imme-diately,” said Darin David, a se-nior director in the sportsmarketing group at The MarketingArm, a Dallas-based marketingagency. “It remains to be seen onhow brands pursue him. He’s notone of the more recognizable play-ers in baseball. This will certainlyraise him a big level.”

Marketing giants will take ahard look at Cabrera.

“He’ll certainly have more of-fers,” David said. “The premierbrands with the biggest budgets,like Nike and Pepsi? They may bewilling to invest in him and capi-talize on it, but it’s hard to say atthis point.”

He estimated that Cabrera,whose salary is $21 million with

the Tigers, will earn at least a cou-ple million more from endorse-ments and deals with autographand merchandise dealers.

Also hurting Cabrera from po-tentially earning more is a lack ofhype surrounding the TripleCrown, David said.

“It’s not getting the media playit probably deserves,” he said.“Maybe the Triple Crown is suchan achievement that we’ve notseen in so many years, fans don’thave a grasp of it.”

While the Spanish-speakingCabrera can be difficult to under-stand when speaking English dur-ing post-game interviews, there ismoney to be made in endorse-ments for products targetingSpanish-language audiences,David said.

Cabrera has an endorsementdeal now for Maltin Polar, a nonal-coholic malt beer brewed and soldin his native Venezuela.

Cabrera also has deals to en-dorse Franklin batting gloves andNew Balance baseball cleats, ac-cording to ESPN’s Darren Rovell.

He also has done advertising forMetro PCS and Venezuela’s state-owned Citgo Petroleum Corp.,which operates Citgo gas stationsin the U.S., said Bob Williams,CEO of Evanston, Ill.-based BurnsEntertainment & Sports MarketingInc., which represents companiesthat want to hire athletes to en-dorse products. In the past, Burnshas brokered deals involving De-troit stars such as Barry Sanders,Isiah Thomas and Kirk Gibson.

Forbes.com estimated in Junethat Cabrera made $150,000 in en-dorsements last year.

Cabrera winning the TripleCrown “will take him up a levelwith advertisers setting the stagefor national endorsement oppor-tunities,” Williams said. “TheTigers winning the World Serieswould help significantly as adver-tisers love to associate their prod-uct or service with winners.”

A drag on Cabrera’s marketingpotential is his personal history— and his demeanor.

“He has to overcome his off-field problems with alcohol andhis low-key personality. Advertis-ers look for the charisma, that Xfactor, which is hard to describe,but you know it when you see it,and it is present in all top sportsendorsers,” Williams said.

Cabrera underwent threemonths of alcohol treatment be-fore the 2010 season after an Octo-ber 2009 incident in which he end-ed up in police custody after anight of drinking at the TownsendHotel in Birmingham and an ar-gument with his wife.

In January, he pleaded no con-test to a drunken driving chargeafter a February 2011 arrest in St.Lucie County, Fla.

He’s had no subsequent inci-dents. The Tigers hired a handlerto keep him company when awayfrom the field; and when the teamearned a playoff berth the pasttwo seasons, players celebratedby spraying non-alcoholic cham-pagne in the locker room out of re-spect for his treatment.

Cabrera is represented byNorthbrook, Ill.-based SFX Base-ball Group, also the agents for hishigh-profile teammate, pitcherJustin Verlander, the reigningAmerican League MVP and CyYoung Award winner.

Cabrera’s Triple Crown is onlythe 16th time in the history ofbaseball a player has accom-plished the feat. Hall of Fame out-fielder Carl Yastrzemski was thelast. In 1967, he hit .326 with 44home runs and 121 RBI with theBoston Red Sox and won theAmerican League MVP.

The only other Tiger to do itwas Ty Cobb in 1909, when he hit.377 with nine home runs and 107RBI. Detroit lost the World Seriesto the Pittsburgh Pirates that yearin seven games.

— Bill Shea

Cabrera may not be such a heavy hitter in marketing

Cabrera

� National media rights deals(mostly TV, but a little extra comesfrom radio)� International media rights� MLB Properties merchandiseprofits (from souvenirs like jerseys,caps and other memorabilia)

� Internet rights (exploding in valuedue to video consumption onmobile devices)� National sponsorship deals� Miscellaneous licensing revenue(via MLB Properties)

Source: Gary Gillette, the Detroit-based author, co-editor of the ESPN BaseballEncyclopedia and board member of the Society for American Baseball Research.



St. Joseph AnnArbor plans$29M addition

t. Joseph Mercy Hospi-tal, Ann Arbor, sub-mitted plans to the

Michigan Department of Com-muniity Health for a $29.3million addition to replacenine outpatient operatingrooms with larger, updatedrooms that would accom-modate robotic equipment.

The next step is submis-sion of a formal certificateof need application to thestate.

ON THE MOVE� Visteon Corp. an-

nounced the involuntaryresignation of ExecutiveVice President and CFOMartin Welch. He will be re-placed in the interim byMichael Widgren, vice presi-dent, corporate controllerand chief accounting offi-cer of the Van Buren Town-ship-based supplier. Vis-teon earlier named TimLeuliette its permanentpresident and CEO.

� Clayton & McKervey PCnamed Kevin McKervey man-

aging di-rector,replac-ing DonClayton,who as-sumesthe newpositionof chair-man atthe

Southfield tax and account-ing firm.

� Novi-based Cooper-Standard Holdings Inc.named Johnson Controls Inc.executive Jeffrey Edwardspresident and CEO, effec-tive Oct. 15. He succeedsJohn McElya. Edwards alsohas been elected to theboard of directors.

� Auburn Hills-basedRGIS LLC announced thatJohn Ling will replace CEOBruce Barkus, who is retir-ing from the inventory,supply chain and store-mapping company. Linghad been COO.

� Naomi Patton, who re-cently resigned as DetroitMayor Dave Bing’s presssecretary, was named se-nior director of public rela-tions for Auburn Hills-based Palace Sports &Entertainment LLC.

� Mike Freed has beennamed president and CEOof Grand Rapids-based Pri-ority Health, moving upfrom interim. He replacedKim Horn, who resignedMay 1 and will this monthtake over as head of Oak-land, Calif.-based Kaiser

Permanente’s Mid-Atlanticregion.

COMPANY NEWS� TRW Automotive Hold-

ings Corp. stock rose 7.6 per-cent to $47.02 — the largestintra-day gain in more thanseven months — after theLivonia-based company au-thorized a $1 billion sharerepurchase program.

� Vehicle ProductionGroup LLC, producer of theMV-1 wheelchair-accessi-ble vehicle, plans to relo-cate its Fort Lauderdale,Fla., headquarters to AllenPark and will move about10 people there. The compa-ny employs about 200 inMichigan.

� General Motors said itwill close its hydrogen fuel-cell research operation nearRochester, N.Y., and move itto Michigan, the AP report-ed. Most of the 220 salariedworkers in Honeoye Falls,N.Y., will be offered thechance to move to GM’s en-gine and transmission re-search unit in Pontiac.

OTHER NEWS� The union represent-

ing Detroit Water and Sewer-age workers said a five-daystrike has ended and that36 employees fired for walk-ing out will get their jobsback. Talks with manage-ment were to resume.

� The Southeast MichiganPurchasing Managers Indexrose to 50.6 points in Sep-tember from 45.7 in August,ending a three-month de-cline. A figure above 50 in-dicates economic growth.

� Comerica Bank chiefeconomist Robert Dye saidthat primarily due to politi-cal uncertainty, his forecastfor the first six months of2013 is actually three: one,decent growth in gross do-mestic product of 3 percent;two, a “growth recession,”with growth of 1.5 percent to2 percent; and, three, a re-cession with a GDP declineof about 2 percent.

� A financial consultanthired by businessmanManuel “Matty” Moroun,owner of the AmbassadorBridge, said Michigan islikely to lose about $325million in expected tax rev-enue over the next 20 yearsas traffic diverts from exist-ing border crossings withCanada to the New Interna-tional Trade Crossing.

� The Fox Sports Detroitcable network set a viewer-ship record for its 148 De-troit Tigers game broadcaststhis season, thanks to a 41percent ratings increasecompared with last year.It’s believed that Detroitled all of Major League Base-ball in local TV ratings in2012, according to industryreports. In a separate re-port, three Tigers were

named among the top 20 insales of Major League Base-ball jerseys from Easton,Pa.-based Majestic since theAll-Star break. PitcherJustin Verlander is ninth,first baseman Prince Fielder15th and third basemanMiguel Cabrera 19th. TheNew York Yankees and TexasRangers were the only otherteams with three playerson the list.

� The 2012 Cattle Baron’sBall at Joe Louis Arena netted$1.2 million for the AmericanCancer Society Great LakesDivision, maintaining theevent’s spot as one of the topone-night fundraisers inmetro Detroit.

� A pollster hired toquestion Detroit residentsin 2001 about Kwame Kil-patrick’s first run for mayortestified that his firm waspaid by Kilpatrick’s pur-ported charity, The DetroitNews reported. DanielGotoff said his firm’s billswere paid by the KilpatrickCivic Fund; prosecutors al-lege the expense was illegalbecause IRS laws barredthe fund from paying mon-ey to a political campaign.

� Detroit Mayor DaveBing suspended Police ChiefRalph Godbee Jr. for 30 daysamid allegations that themarried chief had a sexualrelationship with a subor-dinate.

� The Michigan Film Of-fice has $58 million in in-centives available for quali-fying film and digital mediaprojects during the just-started fiscal year, the De-troit Free Press reported.

� Grand Rapids-basedPriority Health, the state’ssecond-largest health main-tenance organization, hasbeen selected by the Michi-gan Office of Financial and In-surance Regulation as thebenchmark HMO for thestate’s health insurance ex-change. The U.S. Depart-ment of Health and HumanServices is expected to givefinal approval.

� The Ilitch family stillintends to build a hockeyarena for their Detroit RedWings but won’t disclosethe preferred location, andthere are no formal talksabout the Detroit Pistonsjoining them in a new facil-ity. So said Ilitch HoldingsInc. President Chris Ilitchduring a sports-event orga-nizer expo at Cobo Center.

� Troy-based FlagstarBancorp Inc. has signed adigital marketing deal withthe University of Michigan’sathletics department. Fi-nancial terms were not dis-closed.

OBITUARIES� Peter Fletcher, a promi-

nent Republican supporterand owner of the Credit Bu-reau of Ypsilanti Inc., diedSept. 29. He was 80.

undits were justabout unanimous intheir belief that Mitt

Romney outdueled PresidentBarack Obama in last week’spresidential debate.

Whether that means theneedle moves at all for Rom-ney among voters in his na-tive state remains to be seen.

Poll after poll has shownthe president with a sharplead over the Republicanchallenger, although nostatewide post-debatepolling data had been pub-lished as of Friday.

The Sept. 27 “We AskAmerica” national tele-phone poll of 1,064 likely vot-ers had the president lead-ing 52 percent to 40 percent.Seven percent were undecid-ed, and slightly more than 1percent intend to vote forLibertarian Party candidateGary Johnson. The error mar-gin was 3.1 percent.

Neither candidate isspending on Michigan TVadvertising, but they’resending their backup quar-terbacks into the state: VicePresident Joe Biden was inDetroit in August, and GOPvice president candidatePaul Ryan is expected tocampaign here this month.

The lack of TV ad spend-ing is a sign that Michiganisn’t a swing state, and itwould take a significantpost-debate shift in the pollsto change that.

“I think you’ll know(Michigan is in play) if yousee some advertising on theObama side,” said RichRobinson of the Lansing-based Michigan Campaign Fi-nance Network, which tracks

political spending.Romney and Obama will

debate next at 9 p.m. Thurs-day at Centre College inDanville, Ky.

Hospital systemsymbolically fights city hall

McLaren Health Care stillplans to build a $303.7 mil-lion hospital in Indepen-dence Township despitehaving its certificate of needapplication rejected June 25by the Michigan Departmentof Community Health.

But in the meantime, itdecided to make a point byfiling an application for amedical office building ofthe same 400,000-square-footsize at the same price on thesame site.

Jeff Timmer, a spokesmanfor McLaren with Lansing-based Sterling Corp., ac-knowledged that McLarendoesn’t intend to constructthe building.

“It was done to illustratethe irony that while (com-munity health) deniedMcLaren’s request to builda hospital, this (same de-partment) granted a waiverfor the same exact specs andcosts” just because it is amedical office building,Timmer said.

Unlike a hospital, though,an office building — evenone for doctors — is not ahealth facility under stateregulations, and so Commu-nity Health ruled that a cer-tificate of need was not need-ed. The department rejectedthe hospital plan because itcalled for transferring 200

RUMBLINGS WEEK ON THE WEBF R O M W W W . C R A I N S D E T R O I T . C O M , W E E K O F S E P T . 2 9 - O C T . 5

Blues’ conversion good or bad?

Debate’simpact onstate up in airP

S

BEST FROM THE BLOGSR E A D T H E S E P O S T S A N D M O R E A T W W W . C R A I N S D E T R O I T . C O M / B L O G S

It’s one thing towrite about Detroit andall its failings from thecomfort of a newsroom.It’s quite another tohear gunshots ring outas dusk settles on thefar east side of thecity.”

“Sound of gunfire a reminder

Is Blue Cross amonopoly? ... Should theinsurance code betweaked because of BlueCross' proposedconversion (into anonprofit mutual)?”

“

beds eight miles fromMcLaren’s Pontiac hospital,but state regs limit thetransfer of beds to two miles.

Timmer said McLarencould appeal the state’sCON decision, and it couldfile a lawsuit. It also has re-cruited Sen. Mike Kowall, R-Hamburg Township, to per-suade legislators to approvethe new hospital.

Macomb to honor pie baron, others

The Macomb Foundation ishosting its annual MacombHall of Fame event Oct. 11,honoring county businessand community leaders.

This year’s 2012 in-ductees include WendyAchatz, co-owner of Chester-field Township-based AchatzHandmade Pie Co.; RobertCannon, Clinton Townshipsupervisor; Mike Chirco,president of Macomb Town-ship-based MJC Cos.; SteveHarrington, member of Clin-ton Township-based Ad-vanced Cardiothoracic Sur-geons PLLC and medicaldirector of cardiothoracicsurgery at Henry Ford Ma-comb Hospitals in ClintonTownship; and the Wujekand Calcaterra families,owners of Wujek-Calcaterra &Sons Inc. funeral homes inSterling Heights and ShelbyTownship.

The event, from 5:30 to9:30 p.m. at Mirage Banquets& Catering on 18 Mile Road inClinton Township, will fea-ture an arts and culturetheme with displays fromthe Detroit Institute of Arts andMt. Clemens’ Anton Art Cen-ter. The foundation, the non-profit arm of the MacombCounty Chamber of Commerce,has inducted 53 leaderssince the Macomb Hall ofFame was founded in 2000.

Tickets for the event,which includes a reception,silent auction and dinner,are $175 each and can bebought by calling (586) 493-7600 or online at macomb-countychamber.com.

Reporter Nathan Skid’s Detroit-area restaurant blogcan be found at www.crainsdetroit.com/skid

Reporter Jay Greene’s blog about health care,insurance and the environment can be found atwww.crainsdetroit.com/greene

McKervey


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