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FAST LANE - October
2003
Construction of the 335,000-square-foot facility is slated to begin this year with completion planned for mid-2005. Within the first three years of operation, the company expects to employ more than 80 office and clerical employees and 300 package handlers at the business-to-business small package distribution hub. The new facility will also create an additional 100 independent contractor positions. At full capacity, the new hub will process up to 45,000 packages per hour and could eventually employ more than 235 office and clerical employees, 1,300 package handlers, and 400 independent contractors. FedEx officials say the Boone County site was selected based its central location, proximity to customers’ distribution centers and interstate highways, and a skilled and available workforce. COVINGTON
Eighty percent of the current reductions will be completed before Nov. 30. The company expects to record approximately $18 million in before-tax charges in the September quarter for severance and other costs related to the personnel changes occurring by Nov. 30. Ashland eliminated about 200 jobs earlier in fiscal 2003 and recorded $8 million in severance and related costs in earlier periods. The combined total of 700 jobs is equal to about 7 percent of Ashland’s salaried employees. O’Brien added that Ashland is examining additional cost reductions through a realignment of activities across the corporation and outsourcing. O’Brien instituted a companywide review of operations a year ago shortly after he became CEO, in an effort to improve the company’s disappointing performance. Through the first nine months of its last fiscal year, income was off more than 50 percent. Credit rating agency Standard & Poor’s recently issues a caution that a downgrade of its long-term rating is possible if improvement is not seen soon. FRANKFORT PlanGraphics, Inc., a Frankfort information technology firm, has added a new feature to its Web site that lists various grant opportunities available to businesses. The site provides information regarding federal, state and local government grants, as well as foundation grant funding opportunities and information related to various industries. The site also permits viewers to register for automatic e-mail notification when the list of grants is updated, which occurs about once a month. “Many of these funding opportunities can be utilized to assist in developing spatial information assets and solutions for emergency operations that also have ‘dual use’ potential throughout the organization,” explained Joyce Jackson, PlanGraphics’ client development manager. “The automatic notification allows interested parties to stay up-to-date and informed about current grant opportunities.” The grant information is available on PlanGraphics’ Web site at www.plangraphics.com/ grants/grants.htm. LOWES
The Bank of Lowes, located in the Western Kentucky community of Lowes, closed on August 31, just short of its 100th anniversary. The bank, which had fewer than 500 customers and around only $1 million in assets, was owned by the Wilkerson family for nearly six decades. With its original vault, wrought-iron bars at the teller windows, and dedication to doing things the old-fashioned way (i.e. without computers), the tiny operation drew the attention of publications ranging from People magazine to the Wall Street Journal. In 2000, it was purchased by Barry Hurley, who owns three Georgia banks. Though ownership changed, Jack Wilkerson and his sister, Dorothy McClellan, continued in their roles as president and vice chairman/treasurer, respectively. Recently, however, Hurley converted his bank charters from the Federal Deposit Insurance Corp (FDIC) to the Office of Thrift Supervision, which doesn’t allow for multi-state operations. With no other banking operations stepping forward to take over, the Bank of Lowes was forced to close, becoming another casualty in the sea of change. BOWLING GREEN Technological advances have resulted in a decision by the U.S. Postal Service to close its Bowling Green Remote Encoding Center next March. The facility is one of four in the country that is being closed. The Bowling Green facility is currently responsible for handling letters and packages that are deemed unreadable by optical scanners at regional mail-handling stations. However, with the recent advancements in character recognition technology, 89 percent of printed mail and 80 percent of handwritten addresses can be coded by machine. When the center opened in 1997, only two percent could be coded that way. According to William J. Brown, Southeast area vice president for the postal service, the remote encoding service (REC) locations were designed as a temporary solution to automate and expedite the processing of those addresses that were difficult to ascertain. “The plan from the start was to downsize the REC operation as technology enhancements enabled us to automate more mail,” he explained. The closing will result in the loss of 240 jobs. GEORGETOWN
“This is as fine a training camp facility as any NFL team enjoys,” said Bengals President Mike Brown. “Sometimes you get lucky, and that happened to us eight years ago when the people at Georgetown first proposed that we train here. We have a great relationship, and I’m very pleased to take it out into the future.” The deal represents a two-year extension of an original seven-year commitment. The Bengals began training at Georgetown College in 1997, coming to Central Kentucky from Wilmington, Ohio, where they had trained for 29 years. The partnership has been mutually beneficial for both parties as the college’s vision for a new athletic complex coincided with the Bengals plans to relocate. The venture with the Bengals provided Georgetown with the financial catalyst needed to build a state-of-the-art facility. The resulting construction project has produced a new stadium, conference center, athletic fields and student dormitories. “The Bengals have been faithful in doing everything they promised they would do,” said Dr. Bill Crouch, president of Georgetown College, “and we hope we’ve handled our end. We’ve had an exciting atmosphere at camp this year under Coach (Marvin) Lewis, and we’re excited about the future.” BOWLING GREEN Humana Inc. and BB&T Bank have each donated $250,000 to Western Kentucky University’s Gordon Ford College of Business. The donations, which will be matched by the Commonwealth of Kentucky’s Regional University Excellence Trust Fund, will be used to create visiting professorship positions in business leadership and ethics. “The programs provided through this gift will enable us to prepare competent graduates and leaders with high ethical standards who seek to create new or expand existing business organizations and bring new ideas for business development to Kentucky,” said WKU President Gary Ransdell. “This endowment will allow us to enhance the encouragement of personal character and professional leadership with integrity, and to foster entrepreneurship and leadership among business graduates and faculty.” LOUISVILLE
“We’re having a phenomenal run in Louisville… but we’re stretching the space in the locations that currently work for us there,” says IBMA Executive Director Dan Hays. “Even without the growth we expect, there’s more demand than we can centrally accommodate in Louisville today.” The annual bluegrass homecoming includes the trade association’s annual convention, the IBMA Awards Show and Bluegrass Fan Fest, which attracts more than 22,000 annually over the course of the seven-day event. The convention attracted approximately 15,000 in 2002, creating an estimated economic impact of some $3.3 million for the Louisville area according to statistics from the Greater Louisville Convention and Visitor’s Bureau. In selecting a new site, IBMA officials said the primary considerations were availability of quality space and services to accommodate growing attendance and needs for additional exhibitor space, a centralized location in proximity to IBMA’s membership and the music business, autumn dates that prevented the fewest conflicts with other major music events, and properties that would fulfill those needs at reasonable rates. IBMA serves as the bluegrass music industry’s non-profit trade organization and represents some 2,500 artists, composers, labels, publishers, event producers, broadcasters, media, educators, agents, managers and other associations in 30 countries. FRANKLIN
Sygen is planning to add two research facilities at the Franklin site. One facility will be dedicated to continuing the company’s research involving pig breeding. The other will be devoted to the research of shrimp genetics. Both facilities are expected to be complete by early next year. Since launching its U.S. operations in 1973, PIC has expanded rapidly and currently employs 180 throughout its facilities in Kentucky. The expansion will add around 25 new jobs to the staff of 150 currently employed at the Franklin facility. Ten of those positions will be held by employees who are transferring from the company’s Berkeley, California location. Sygen officials say the Franklin site was selected for the expansion because it allows for a world-class research and development center close to the company’s major customers and largest markets. STATE The U.S. Senate has approved Kentucky Senator Mitch McConnell’s request for nearly $80 million in defense-related projects that will take place in Kentucky. Seventy-three million dollars has been appropriated for projects in Louisville that will be handled by United Defense, Raytheon, the McConnell Technology Training Center (MTTC) and the University of Louisville. The funding has been earmarked as followed: United Defense: $34.3 million for the manufacturing of Mk45 5” Mod 4 Guns, $9 million for 5” Mk45 depot overhauls; $7 million to overhaul surface vessel torpedo tubes; and $1.2 million for minor caliber gun research and testing • Raytheon: $4 million to overhaul Phalanx close-in weapons systems and $8 million for research and development work on the Phalanx SEA RAM ship defense system. • MTTC: $8 million to resolve U.S. Navy shipboard problems through innovative products and technologies. The Navy projects that MTTC’s initiatives will save more than a half billion dollars over the next 15 years. • University of Louisville: U of L will receive funding for continued research and development of new state-of-the-art armored vehicles for the U.S. Army. U of L will also receive $1.5 million for its work in support of the Nanoscience Army Missile Defense Initiative. Another $5.25 million has been allocated to KECO Industries in Florence for research and testing of a new bulk fuel transfer system that will reduce the time it takes for the U.S. Army to deploy existing fuel lines. Accu-Counter in Kenton County has been awarded $1.5 million, which will be used to enhance the ability of Special Operations Forces to gauge the reliability of their weapons. SPENCER COUNTY The Spencer County Economic Development Authority has broken ground for the first private development on Taylorsville Lake, 26 miles southeast of Louisville. Edgewater Resort will encompass 163 acres overlooking the 3,050-acre lake, leased indirectly from the Louisville District of the U.S. Army Corps of Engineers. The proposed $45 million resort will be sited on a prominent peninsula on Taylorsville Lake, approximately a quarter mile from the lake’s marina, which can accommodate everything from canoes to houseboats. Launching facilities, fuel and boat rentals are also available. Plans for the resort call for it to be developed in two phases. Phase I will include the construction of most of the 120 cottages. Phase II will feature the development of the remaining cottages and a “condo-hotel” (similar to those found at Hilton Head, S.C.) and conference center. Construction of the cottages will begin this year, with the “condo-hotel” and conference center scheduled to begin within 18 months. The resort will offer the only overnight accommodations directly on the lake. The project is expected to generate an economic impact of around $14.5 million in the first year its development and grow to $37 million annually by the end of its third year. The project will create approximately 145 jobs in Spencer County. FLEMINGBURG
In addition to the Bluegrass Housing plant in Flemingsburg, which employs around 120 workers, Champion is closing its facilities in Georgia, North Carolina and Texas. Thirty-five of the company’s retail sales centers are also being closed. The manufactured home industry has suffered a 65 percent drop in sales over the past five years. Last year, Champion cut 1,500 jobs in an effort to return to profitability. This year’s lay-off involves another 1,000. “We are committed to a return to a sustained profitability,” said Al Koch, the company’s chairman, president and CEO. “These decisive steps to size operations to lower industry demand are required in light of continued tough market conditions. We also believe they will position the company with substantial operating leverage if and when the market improves, particularly with nine idle facilities that could be re-opened as opportunities arise.” LOUISVILLE Tradebank International, one of the world’s largest barter/trade exchange networks, has opened its newest office in Louisville.
Bartering, or trading goods and services for those of another, has turned into a $6 billion a year business in the U.S. alone. Statistics show that more than 80 percent of Fortune 500 companies and thousands of other businesses across the world barter. The Atlanta-based company was founded in 1987 and now has branches through the U.S., Canada and Europe. Louisville native Jeff Ballard is the owner and operator of the new Kentucky location. Since opening in August, businesses including Gold’s Gym, Minute Man Press, Signs Now, Flowers by Juliet and Distinctive Home Accents have already become part of the network. Membership in the network requires a one-time fee of $495 (which is refundable if Tradebank does not bring new business to the client) and a quarterly accounting fee of $29.95. There is a 15 percent fee on purchases only. For more information on Tradebank of Louisville, visit www.tradebank.com or contact Jeff Ballard at (502) 608-9411. OWENSBORO Large Scale Biology Corporation has announced plans to begin producing research-grade aprotinin at its biomanufacturing facility in Owensboro. Aprotinin is a drug that affects blood clotting and is utilized during high-risk surgeries, such as cardiopulmonary bypass, to reduce bleeding. Employing its patented GENEWARE® technology, the California-based company has conducted field trials of the recombinant aprotinin successfully since April and is now planning industrial-scale production of its active pharmaceutical ingredient (API) for use in research and development. Estimates of the biomanufacturing market for research grade aprotinin, a protease inhibitor, range up to $20 million annually. Given global concerns and supply constraints related to bovine-sourced aprotinin, industry analysts say this may be an opportunity for Large Scale to exploit its ability to provide the market with a safer product. The company’s GENEWARE technology provides a method for producing biopharmaceuticals free of human or animal pathogens by using tobacco plants as the production host. LOUISVILLE
The Michigan-based company’s existing plant in Louisville, which opened in 1999, produces plastic interior components for the Ford Explorer vehicles made at Ford’s Louisville Assembly Plant. The plant currently operates with a staff of 370. The new facility – a leased building situated in the Jefferson Riverport International Industrial Park – will build exterior vehicle parts such as bumpers. In February, the Kentucky Economic Development Finance Authority granted approval for $8.5 million in tax incentives in an effort to entice the company to expand in Louisville. At the time, Louisville was in the running with cities in several other states for the $78 million building. bring those services back to the area. SOMERSET
The project represents the eighth addition made to the 234-bed acute care hospital since it was built in 1976. During that time, the hospital has nearly doubled its facility size and added new off-site outpatient service locations for diagnostic imaging, surgery, sports medicine, and sleep disorders, as well as a new cancer treatment center now under construction and slated to open in early 2004. In addition to the new construction, several areas of the existing hospital building will be remodeled or expanded. As a result, more than 60 percent of the hospital’s rooms will become private. Lake Cumberland Regional Hospital is the largest non-governmental employer in Pulaski County, with 1,200 employees and an annual payroll of nearly $46 million. TENNESSEE
The transaction creates a company with a market capitalization of $13 billion and combined annual revenues of $23 billion. As such, Caremark gains the distinction of being Nashville’s largest company. “Caremark Rx and AdvancePCS are a compelling strategic fit with relatively little market overlap,” said Mac Crawford, chairman and chief executive officer of Caremark Rx. “Historically, our two companies have specialized in different areas of the pharmaceutical benefits management sector. AdvancePCS has built a strong base of managed care customers while Caremark Rx has focused on the employer marketplace. Both companies are widely recognized for their skill in serving their respective customer bases. Upon completion, this combination will create a diversified customer portfolio with a balanced, clinically-focused offering that should enable us to deliver exceptional care, service and cost efficiency to our customers and their participants.” On a combined basis during the twelve months ended June 30, 2003, Caremark Rx and Texas-based AdvancePCS managed more than 600 million prescription claims. INDIANA
Thomson officials have said it is imperative that the company cut costs by at least $25 million a year. If the voluntary job buy-out doesn’t elicit enough response, layoffs will have to be the next option, they added. The company has seen a drop in U.S. sales of consumer electronics products and has been in talks with potential partners in China. However, Thomson officials say that as things now stand, the company has too much overhead to make it attractive to other such businesses. Thomson has already cut a significant number of jobs over the past several years. The staff numbers in Carmel have dropped by more than 300 in the past three years and the Marion, Indiana picture tube plant saw 820 positions cut this past summer.
Business Briefs BOWLING GREEN
CORBIN
ELIZABETHTOWN
EASTERN KENTUCKY
FORT THOMAS
GLASGOW
GREENUP COUNTY
HOPKINSVILLE
JUNCTION CITY
LEBANON
LEXINGTON
LOUISVILLE
MIDDLESBORO
MOREHEAD
MUHLENBERG COUNTY
NEWPORT
RICHMOND
SHEPHERDSVILLE
STEAMS
WAYNE COUNTY
WHITESBURG
WILLIAMSBURG
STATE
INDIANA
OHIO
TENNESSEE
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Copyright 1996-2003, by Kentucky Business Online. All rights reserved. Editorial content
is copyright 2003, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
FedEx
Ground Support Systems, Inc. has selected a 96-acre site in unincorporated
Boone County for its newest distribution hub. 
Ashland
Inc. (NYSE:ASH) recently announced that will eliminate approximately
500 jobs in Ashland’s wholly owned businesses and corporate resource
groups. The goal is to reduce selling, general and administrative expenses
by approximately $75 million a year in fiscal 2004. This amount is in
addition to $25 million in annual savings already achieved from a previously
announced program earlier in fiscal 2003. 
Ashland
Chairman and Chief Executive Officer James J. O’Brien said the
savings initiative reflects an effort to build and maintain a Top-Quartile
Cost Structure (TQCS). “Reducing our costs is a pivotal part of
our strategy to produce top-quartile results relative to our peers.
Becoming a low-cost, operationally excellent organization is critical
to serving our customers, enhancing our financial strength and restoring
our ability to grow,” he added. 
One
of the nation’s smallest banks has officially closed its vault
for the last time.
A
new agreement between Georgetown College and the Cincinnati Bengals
football team will keep the team’s training camp at Georgetown
College through 2005.
The
International Bluegrass Music Association (IBMA) has selected Nashville,
Tennessee to host its annual World of Bluegrass events beginning in
2005. The World of Bluegrass has been hosted for the last seven years
at the Galt House in Louisville, where it will continue to be hosted
in 2003 and 2004. 
Sygen
International plc, a United Kingdom-based company that ranks as a world
leader in applying quantitative genetics and biotechnology to animal
breeding, has announced plans to expand its operation in Franklin. The
facility is operated by PIC USA, a Sygen subsidiary headquartered in
Franklin that is the world’s largest and most extensive pig breeding
company.
Champion
Enterprises’ Flemingsburg plant is one of four homebuilding plants
being closed by the Michigan-based company as a result of a reduced
demand for manufactured housing. 
By
joining Tradebank, businesses become part of network of companies that
offer more than 100,000 products and services, enabling them to trade
with other businesses in their respective cities and throughout the
organization. The membership network includes listings for auto mechanics,
dentists, restaurants, hotels, salons and limousine services, to name
just a few.
Plastech
Engineered Products has announced plans to expand its presence in Louisville
with a second facility that could create as many as 425 new jobs. 
Lake
Cumberland Regional Hospital has unveiled plans for a $55 million expansion
that will include the construction of a new five-story, 116,000-square-foot
patient tower and a three-level parking garage. 
Nashville-based
Caremark Rx Inc., one of the nation’s largest pharmaceutical services
companies, has signed an agreement to purchase AdvancePCS for $6 billion
in stock and cash.
In
an effort to reduce costs and remain competitive, electronics manufacturer
Thomson has offered voluntary job buyouts to the majority of its 1,100
employees in Carmel, Indiana. 
Procter
& Gamble has acquired a controlling share of interest in Wella
AG for $5.06 billion. P&G’s acquisition of the German hair
products giant represents the largest transaction in the Cincinnati
company’s history.