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FAST LANE - July
2004
The Greater Cincinnati/Northern Kentucky International Airport ranked 75 on the list, while Louisville International came in at 147th. STATE Kentucky’s Rural Broadband bill is now official, allowing for the deregulation of broadband service. The bill is expected to open the door for expanded technology investment throughout Kentucky and is being applauded by connectkentucky steering committee members as well as national industry leaders. BellSouth’s residential packages will begin at $24.95 per month, with business packages ranging from $79.95 to $219.95 per month. “Broadband is essential to building a more competitive local economy,” stated Fletcher. “In this bipartisan effort to encourage broadband expansion, we are giving our rural communities greater opportunity for economic development. Full broadband deployment will allow us to create a critical mass of innovative businesses in Kentucky.” According to the Progressive Policy Institute, Kentucky currently ranks 41st in the nation in broadband deployment. FRANKLIN Tyco Electronics has announced that it will close its manufacturing plant in Franklin next spring, leaving 245 people without jobs. Approximately 50 employees will remain with the company as part of a technical center planned for the Franklin/Bowling Green/Nashville area. The closing is part of the company’s ongoing strategy to consolidate facilities to create a more efficient manufacturing operation. At its peak, the Franklin plant had some 500 employees on the payroll. Tyco, which is based in Bermuda, is one of the largest producers of electronic relays for the North American automobile industry. The company’s electronics division produces products such as connectors, circuits, wiring and cable switches. Tyco will continue to operate its adhesive plant in Franklin, which employs some 600 workers. STATE
Acxiom Corporation, a database services company, has released its first “Mirror on America,” which ranks American’s top 150 Metropolitan Statistical Areas (MSAs) based on their overall characteristics as a consumer test market. The rankings are based on how closely the population of the metropolitan area “mirrors” the characteristics of the U.S. consumer population as a whole. Within that listing, three Kentucky communities were listed in the top 20. Lexington ranked highest, coming in at No. 12, followed by Henderson, KY/Evansville, IN at No. 18 and the Northern Kentucky/Cincinnati area at No. 20. To create the ranking, Acxiom’s Personicx household segmentation product was used to compare and contrast America’s marketplaces based on criteria such as age, marital status, home ownership and estimated income. STATE
Associated Industries of Kentucky is an alliance of over 3,200 member companies committed to economic progress in Kentucky. The awards are presented in three categories: Small, Mid-Sized and Large Industry. Selection of the award winners is accomplished by a panel of judges representing business, education and trade associations. “The AIK Industry of the Year Award showcases entrepreneurial spirit, community leadership and policy contributions made by Kentucky industry to the economic success of our Commonwealth,” said AIK President/CEO Andrew C. Meko. “Our goal is to display how Kentucky industries make a positive impact on the quality of life in our state.” Anyone may nominate an industry or business located in Kentucky and self-nominations are encouraged. Criteria for the award include:
Nominations must be received by mail or fax on or before September 24, 2004. For more information, call AIK at 800-745-3144 ((502) 491-4737 in Louisville). For more information, contact AIK at 800-745-3144, or visit www.aik.org. LOUISVILLE Humana has announced a new health plan program that promises cost containment and predictability for employers while also offering a “better health plan experience” for employees. The “SmartAssurance” plan is touted as the nation’s first consumer-engagement health program to offer eligible employers a second-year rate increase cap of 9.9 percent. “A growing body of evidence is proving that consumer engagement is the way to solve the employer’s cost dilemma, while at the same time empowering employees to choose and use their benefits with confidence,” said Michael B. McCallister, president and chief executive officer of Humana. “Now we’re taking it to the next level by giving employers the peace of mind that comes with the ability to control the most out-of-control portion of their overhead.” To be eligible for the second-year rate cap, employers agree to use tools such as Humana’s PlanWizard, an online plan-selection enabler; PlanProfessor, a year-round employee education tool; and e-enrollment at the beginning of each plan year. SmartAssurance participants must have at least 500 employees to be eligible for the program. According to estimations by the Midwest Business Group on Health, waste – overuse, underuse and inappropriate use of healthcare resources – is responsible for 30 percent of the $1.7 trillion spent annually in the U.S. on healthcare. ASHLAND
The medical center also has plans to open a $2.3 million hospitality house that will provide out-of-town family members a place to stay for a minimal fee while their loved ones are at the medical center. The facility also will provide temporary lodging for some outpatient needs, such as patients who travel long distances to the medical center for cancer treatments. The house is expected to open next summer and will include 12 guest rooms, a common kitchen area, a living room and a laundry facility. Other projects include a $15 million medical plaza featuring 14 physician suites and a new $5.5 million parking deck. Both projects are anticipated to be complete by next spring. King’s Daughters has seen significant growth over the last decade, expanding from 1,100 employees to a team of more than 2,500. The newly announced projects are expected to add another 500 jobs. LEXINGTON ALLTEL and the University of Kentucky have announced an agreement to deploy next-generation voice services to enhance the communications process for students, faculty and staff while advancing the university’s goal of becoming a top national research institution. Deployment of voice over Internet protocol (VoIP) technology adds greater mobility for faculty and students, offering services not currently available over traditional telephone networks. For example, unified messaging allows users to check phone messages, faxes and emails either by phone or a personal computer. Speech-activated messaging will allow callers to respond to email over the phone. Under the new five-year agreement, valued at $12.5 million, ALLTEL and the university will work together to expand the VoIP offering and explore how the technology can improve communications across the commonwealth. “This deployment helps fulfill our vision to better serve students, faculty and staff through the use of new technologies,” said UK President Lee T. Todd Jr. “While we currently provide Internet telephony services to a small portion of our campus, this agreement is an opportunity to significantly expand the availability of enhanced voice and data services throughout the UK system.” ALLTEL also is working with the University of Kentucky and the Kentucky Council on Postsecondary Education to establish the Kentucky Postsecondary Education Network (KPEN), a statewide communications transport network that will interconnect and provide Internet access to educational and governmental institutions across Kentucky. “This agreement is a true partnership with the university that underscores ALLTEL’s commitment to provide advanced communications services to our customers in Kentucky,” said Jeff Abernethy, ALLTEL’s area president for Kentucky. “It also provides a high-tech roadmap for future deployment of Internet telephony services.” LOUISVILLE
Both universities are located in Louisville. Spalding will oversee renovations of the two-story facility, which once housed a downtown business. The newly-acquired building will provide more than 13,000 square feet of additional space for classrooms and administrative offices. A major focus of the renovation will be the development of “smart” classrooms, which will feature cutting-edge technology. Spalding President Jo Ann Rooney said she and her staff expect to continue the enrollment growth seen in the 2004 academic year, which is the result of the university’s new schedule that provides for seven, six-week class sessions rather than the more traditional semester format. “This is a natural opportunity for the two universities to work together,” said Bellarmine President Dr. Jay McGowan. “The building’s donor believes in the strength of downtown development and a need to focus on education. “The added benefit of having this collaboration between Spalding and Bellarmine reinforces our joint commitments to education opportunities in our community and a strong, vital downtown core,” added Rooney. McDOWELL McDowell ARH Hospital has been named as one of the top hospitals in the nation in study conducted by Solucient LLC, an Illinois company that maintains a database of healthcare information. The hospital, which is part of the Appalachian Regional Healthcare network serving Eastern Kentucky and West Virginia, was one of 20 hospitals included in the “small community hospitals” section of the “100 Top Hospitals: National Benchmarks for Success.” Hospitals were judged on quality of care, financial performance, operational efficiency, adjustment to competition and environment and data quality. The 100 hospitals included on the list were separated into five categories: major teaching hospitals, teaching hospitals, large community hospitals, medium community hospitals and small community hospitals. According to Solucient, the healthcare institutions that are included in the listing have higher survival rates; spend less money; release patients from the hospital faster and have fewer employees; treat more of the sickest patients; and keep profits higher in difficult marketplaces. LOUISVILLE
Specifically, the grant will be used to create the Kosair Charities Chair in Pediatric Heart Surgery Research, a position that will direct the research efforts of the center, according to James Ramsey, chair of the Cardiovascular Innovation Institute board and president of U of L. The chair will receive state matching funds from the Research Challenge Trust Fund, more commonly called “Bucks for Brains.” The funds will also provide seed funding for laboratory and clinical studies. The institute facility, which is slated to open in 2006, will bring together biologists, cardiologists, engineers, physiologists and surgeons to work together in one place. LOUISVILLE Louisville-based Commonwealth Industries Inc. has signed a definitive merger agreement with IMCO Recycling Inc., a Texas company that is one of the world’s largest recyclers of aluminum and zinc. With facilities in Kentucky, Ohio and California, Commonwealth Industries is one of North America’s leading manufacturers of aluminum sheet for distributors, transportation, construction and consumer durables end-use markets. The company recently announced the sale of its Alflex subsidiary, a leading manufacturer of electrical products, to Southwire Company for approximately $60 million. The combined company will have approximately $2 billion in annual revenues, 3,600 employees, 34 facilities worldwide, a leading global position in aluminum recycling, a leading position in North American aluminum sheet production, and a leading U.S. position in zinc recycling. Steven Demetriou, who has served as a Commonwealth director since 2002 and was appointed president and CEO of Commonwealth just last month, will be chairman and CEO of the combined company. The combined company is expected to be named and its headquarters selected prior to the closing of the transaction. Commonwealth currently employs approximately 100 people at its Louisville headquarters. OHIO
“This acquisition is part of the National City strategy for growth in our core banking business,” said David A. Daberko, chairman and chief executive officer of National City Corporation. “Wayne Bancorp operates in communities that are contiguous to the existing National City branch network in northern Ohio, one of our strategic markets.” National City is also in the process of buying Cincinnati-based Provident Financial Group Inc. for $2.1 billion. Upon the completion of that transaction, National City will become the 10th largest bank in the country. The company currently operates branches in Kentucky, Indiana, Ohio, Illinois, Michigan, Missouri and Pennsylvania. The company is also expanding its branch network in the Chicago market and entering new markets through recent acquisitions in St. Louis and Cincinnati. TENNESSEE Asurion, a company that provides wireless handset and data device insurance programs, has hired more than 200 new employees for its Nashville call center, bringing the total number employees in the area to approximately 1,100. The company moved their headquarters from California to Nashville last year and has since created 600 new jobs. Company officials said the new hires are necessary due to the increasing volume of business at the Nashville site. In particular, the company noted that bilingual customer service representatives are being sought to meet the needs of the growing base of Spanish-speaking customers. Asurion serves over 12 million subscribers through its relationships with most of the leading wireless carriers in North America, including Alltel, AT&T Wireless, T-Mobile, Bell Mobility, Cingular, Verizon and more than 20 other wireless clients. iNDIANA Indiana Governor Joe Kernan has proposed a new healthcare plan to that will address the needs of small businesses struggling to provide affordable insurance coverage for their employees. The proposed plan would rely on the combined strength of small businesses and would be covered through premiums paid by employers and employees. The program would come at no cost to the state, according to Kernan.
Business Briefs BOWLING GREEN
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Copyright 1996-2004, by Kentucky Business Online. All rights reserved. Editorial content
is copyright 2004, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
Lexington’s Blue Grass Airport is one of the fastest growing airports in the country, according to statistics recently released by the Airports Council International-North America. The ranking of 175 airports puts Blue Grass as the seventh fastest growing airport in North America and fifth among U.S. airports. 
In 2003, passenger activity in Lexington increased by 18.8 percent while average passenger activity for the nation showed only a slight increase of 0.6 percent. The airport has experienced unprecedented growth in recent years, resulting in the addition of six new destinations by four different airlines, a 30 percent increase in daily flights and an overall decrease in average air fares. That trend appears to be continuing in 2004: For the first four months of the year, passenger activity increased by 14 percent over the same period in 2003.
The realization of expanded broadband service in rural Kentucky has already begun, with BellSouth Corporation’s announcement that the company is expanding deployment of its high-speed Internet service in 59 communities within the coming months.
“If it plays in Peoria, it will play anywhere” is a traditional American marketing adage, but it seems that a number of Kentucky cities are proving to be excellent consumer test markets.
Nominations are now being accepted for the 4th Annual Kentucky Industry of the Year Awards, sponsored by Ashland Inc. and Associated Industries of Kentucky. The 2004 awards will be presented at the AIK annual meeting in November in Louisville. 
King’s Daughters Medical Center in Ashland has announced four new building projects totaling more than $66 million. The largest project, a $43.5 million heart and vascular center, is slated to open in Spring 2006. The 120,000-square-foot facility will house a 20-bed chest pain unit, stress testing, outpatient diagnostic testing, cardiac catheterization labs and vascular surgery suites. 
The contract also covers local phone service, voice-mail, unified messaging, long-distance and high-speed data services.
As part of a unique agreement, Spalding University is leasing space in a two-story downtown building that was part of a recent donation to Bellarmine University.
Kosair Charities has made a $5 million charitable commitment to the Cardiovascular Innovation Institute – a partnership of the University of Louisville, Jewish Hospital and Kentucky’s Office for the New Economy – to create the Kosair Charities Pediatric Heart Research Center. The pediatric center will focus on assessing and developing better heart assist devices that meet the special needs of children.
Cleveland-based National City Corporation has signed a definitive agreement to acquire Wayne Bancorp for $180 million. Wayne Bancorp, a bank holding company headquartered in Wooster, Ohio, operates 26 branches and has $825 million in assets. The companies represent two of Ohio’s oldest banks: Both have been in business since 1845.
Fundraising efforts to expand the National Corvette Museum in Bowling Green are on track, with over $1 million having been raised within the first year. Museum officials hope to attain the $6 million goal in about five years. The funds will foot the bill for a 60,000-square-foot addition that will essentially double the size of the existing facility. The expansion will include a permanent library and archives, a café, a Hall of Fame area, and a museum exhibition and banquet hall designed to hold up to 1,000 people.
Ashland Inc. has received approval from U.S. antitrust regulators for its proposed plan to sell a 38 percent interest in Marathon Ashland Petroleum, a joint venture with Houston-based Marathon Oil Corp. Ashland is also selling two other businesses to Marathon in an arrangement valued at approximately $1.11 billion. The sale gives Marathon full control of the most extensive network of refineries and gas stations in the country, with some 8,000 miles of pipeline and 6,000 stations. 
St. Joseph Hospital has announced a four-year expansion and renovation plan designed to help the hospital meet the increasing demands for cardiology, vascular and critical care services. According to statistics from the American Heart Association, Kentucky currently has the fifth-highest mortality rate attributable to heart disease. 
The board of directors of Papa John’s International, Inc. has approved increasing the amount of company common stock that may be repurchased to $425 million. The authorization is valid through December 26, 2004 and includes both open market purchases as well as private transactions. To date, the company has repurchased $397.3 million under repurchase program, leaving approximately 17.1 million shares of common stock outstanding.
In response to the growing consumer trend of counting carbohydrate intake, Brown-Forman has created two new low-carb wines. An estimated 59 million U.S. consumers are now counting carbs as a preferred way to diet. The introduction of One.6 Chardonnay and One.9 Merlot reflects that growing consumer trend. The One.6 Chardonnay and One.9 Merlot hit the shelves last month and already received a strong positive response. The names reflect the actual carbohydrate count contained in a five-ounce serving.
The American Legion National Convention will hold its 2009 event in Louisville, bringing nearly 13,000 delegates to the city. The convention is expected to have an economic impact of more than $17 million. 
The john conti Coffee Co. has acquired Kentuckiana Frozen Beverages, the exclusive distributor of Slush Puppie beverages for 28 counties in Kentucky and Indiana. Slush Puppie President Robert Grossman said the merger provided growth opportunities that had previously not been attainable due to intense competition and the high cost of equipment. 
Pella Corp. is expanding its window and door manufacturing facility in Murray in response to an increase in demand from Lowe’s Home Improvement stores, which has launched a program to aggressively add more stores nationwide. The expansion will add up to 200 new jobs to the existing 550-member staff. 
New scratch-off games and increased sales of Powerball tickets have helped boost sales for the Kentucky Lottery Corporation, which expects to post a record $725 million on $730 million sales and pay the state a record dividend of between $192 million and $195 million. Those figures are exceptionally good news for KLC: With Tennessee implementing its own lottery this year, the state has been steeling for the loss of sales to Tennessee residents. Kentucky Lottery President and CEO Arch Gleason said the 2004 sales have greatly surpassed the expected figure of around $639 million. As a result, the lottery has increased its 2005 sales projections to $665.8 million, up from previously expected 2005 sales of $618 million. 
Conseco Inc. has announced that it must eliminate 300 jobs at its headquarters in Carmel, Indiana in an effort to reduce costs and simplify the company structure. The insurance company, which emerged from bankruptcy last September, is Carmel’s largest employer, with some 2,800 workers.