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FAST LANE - December
2004
“We cannot afford to lose LG&E, its headquarters, jobs and low utility rates that are important to our citizens and our economic development efforts,” Abramson said. “LG&E is a well-run utility and a good corporate citizen. My preference is for the company to stay here for the long term, but we need to explore all options available so that our community and our Commonwealth can better control our own destiny.” In the meeting with E.On Chairman Wulf Bernotat in Germany, Abramson was told that LG&E is not currently for sale. However, in recent public statements, Bernotat has said that E.On is focusing its attention on expansion in Europe and the former Soviet Union and is considering whether to expand or leave the U.S. market. Abramson has been exploring the public ownership option since reports surfaced in the spring that LG&E might be sold again. (The utility company has been sold twice to foreign companies in the six years since LG&E and Kentucky Utilities merged.) Prior to meeting with Bernotat, Abramson assembled a team of legal, financial and energy consultants that determined public ownership of the utility would be a sound and feasible option. Abramson has also met with Gov. Ernie Fletcher and other state officials, as well as business leaders in both Louisville and Lexington. “Louisville has begun the discussion of public ownership because LG&E is headquartered here,” Abramson said. “But we must work cooperatively with leaders across the state to protect a Kentucky asset for Kentucky’s citizens. It’s an opportunity for people who live in different communities to focus on electric lines, not county lines.” LOUISVILLE
Xodiax was founded in 1999 as an outsourcing firm for information technology companies and was recently ranked 85th in Inc. magazine’s list of the nation’s 500 fastest-growing companies. The company provides collocation, Web hosting, managed services disaster recovery solutions and business-class Internet access. The firm handles approximately 150 clients. “Peak 10’s acquisition of Xodiax expands our footprint to five cities and adds a very attractive and strategically valuable franchise to our business,” said Kevin Brandon, partner with Seaport Capital. “Xodiax is a very well managed, financially successful service leader with a diverse and growing customer base.” The combined organization will feature one of the industry’s premier and diversified customer portfolios, covering organizations of all sizes and industries, including Siemens, Raleigh-Durham Airport Authority, Lending Tree, MaximumASP, Kentucky Farm Bureau, Commonwealth Aluminum and Ameristeel. “The combination of these two growing and profitable companies creates significant value for customers, employees and investors,” said Jim Clishem, founder and chairman of Xodiax. “The acquisition gives Xodiax the breadth and depth it needs to remain committed to the Louisville market by expanding our geographic footprint, product portfolio and support infrastructure with minimal disruptions to our business.” Under the terms of the agreement Xodiax will operate as Xodiax, a Peak 10 company. The company’s data center, management team and employee population will remain in the Louisville market. LEXINGTON Immpheron, Inc., a private start-up biotechnology firm has announced plans to expand its Lexington laboratory and will move to a newly constructed research and development center in Coldstream Research Park. Immpheron, Inc. began at the R&D level developing technologies to improve certain protein drugs (antibodies) for diagnostics and therapy of chronic diseases. Funding for Immpheron’s research and development activities is being provided by InNexus Biotechnology, Inc., a Canadian public company. InNexus and Immpheron are setting the stage for producing secondary antibodies for diagnosis kits, R&D research for upcoming therapeutic antibodies, and pursuing further contract work for other out-of-state companies. Gov. Ernie Fletcher noted that the firm’s expansion will help the entire area in terms of attracting other biotech companies to the region. Immpheron’s expansion is expected to result in the creation of 15 new jobs for Kentuckians. STATE
Jonathan S. Blue and Todd Blue are co-managing directors for Cobalt Ventures, LLC in Louisville, an organization that actively invests in operating businesses and develops urban-inspired real estate. Jonathan Blue is responsible for identifying and investing in ventures and diversified opportunities for the company and managing underlying portfolio companies and investment strategies. In addition, he serves on numerous boards, including Actors Theatre of Louisville, Jewish Hospital HealthCare Services, the Cardiovascular Innovation Institute and the Main Street Association. He also serves as a University of Pennsylvania Alumni Career Advisor and is a graduate of Leadership Louisville (2002) and the 2003 Bingham Fellows. Todd Blue is responsible for partnership and brand development as well as leading the development, management and leasing of Cobalt’s real estate portfolio. He currently serves his community through director positions on the Jewish Community Federation of Louisville, and the Cathedral Heritage Foundation. In addition, he is an active member of the Young Presidents Organization (YPO), and serves on the Kentucky Economic Development Finance Authority Board of Directors. He is also a graduate (2001) and former board director of Leadership Louisville. Kenneth Wheeler recently retired from a career spanning nearly 50 years in the maritime industry. During his career, Wheeler was involved in management activities and projects ranging from construction of nuclear submarines to operation of inland towing companies. Wheeler has been involved in recruiting of the Center for Maritime Education, development of the UK Paducah School of Engineering, the Challenger Learning Center and downtown redevelopment. He currently serves as chairman of the Greater Paducah Economic Development Council, in addition to being active in numerous other civic and professional affairs. “Encouraging the best and brightest Kentuckians to stay in the Commonwealth, rather than move out of state to pursue economic prosperity, is a top goal of my administration,” Gov. Ernie Fletcher said. “The three recipients of these awards have done just that, and I commend them for their success and leadership. These three individuals can serve as role models for others who are working to become successful Kentucky business leaders.” STATE The Kentucky Agricultural Development Board has approved state funding for agri-tourism and farmers’ markets, two sectors that are seeing significant growth in Kentucky’s agricultural economy. The 2005 Farmers’ Market Competitive Grants Program is a $1.5 million grants program for regional and community farmers’ markets across the state. The $1.5 million will be divided into the following investment areas: $975,000 (65%) for regional markets, $375,000 (25%) for community markets, and $150,000 for market feasibility studies (10%). Requests for regional markets over $100,000 will be required to have a completed feasibility study. Applications for the competitive grants will be accepted in two rounds in 2005: January 1 and July 1. The funding is part of the state’s continuing efforts to diversify away from tobacco production while revitalizing the farm economy. For more information regarding model cost-share programs contact the Governor’s Office of Agricultural Policy at (502) 564-4627. FLORENCE An international publishing company headquartered in the United Kingdom has selected a site in Florence to establish a distribution and customer service center that will bring approximately 50 new jobs to the area. Taylor & Francis Group is a division of T&F Informa Plc. With offices in Europe, Asia and North America, the company publishes more than 1,000 journals and approximately 2,000 new books each year, with a book backlist in excess of 40,000 specialist titles. Building on two centuries’ experience, Taylor & Francis has grown rapidly over the last two decades to become a leading international academic publisher and, in 2004, merged with Informa to create T&F Informa Plc. Previously, the company had outsourced its distribution needs, but recently decided to purchase the former Thomson Learning Facility in Florence and consolidate their distribution needs to one facility. The new distribution facility is expected to be operational by the first quarter of 2005 and represents an investment of $7 million in the Commonwealth. WINCHESTER East Kentucky Power Cooperative has announced plans to build a new coal plant in Clark County that will implement new technology to burn coal more cleanly and efficiently. Emissions from the plant will be sharply reduced compared to that of a conventional pulverized coal power plant by utilizing a new technology known as circulating fluidized bed. “This is a major step in showing the rest of the country how to use coal as an increasingly clean resource,” Commerce Secretary Jim Host said. “Kentucky already is the nation’s leader in low electric rates. Now, we’re leading the way with coal and advanced technology to fuel our future.” The plant will be built at the J.K. Smith Station, a 3,000-acre site owned by EKPC in Trapp that already contains seven natural gas “peaking” units that only operate on the hottest and coldest days of the year. The newly announced plant, dubbed “Smith 1”, is the second clean-coal plant that EKPC has announced in two months, and will be the third such facility in its generating fleet, bringing EKPC’s total investment in clean-coal technology to more than $1.3 billion. Roy M. Palk, EKPC president and chief executive officer, said the plant is needed because of strong growth among the 16 not-for-profit distribution cooperatives that receive power from – and own – EKPC. The member systems are growing at a rate more than twice the national average and are adding more customers than any other electric utility in the state. Craig Johnson has been named plant manager for the Smith No. 1 facility. Larry Morris has been selected as operations superintendent. STATE The Internal Revenue Service has released the optional standard mileage rates to use for 2005 in computing the deductible costs of operating an automobile for business, charitable, medical or moving expense purposes. Beginning Jan. 1, 2005, the standard mileage rates for the use of a car (including vans, pickups or panel trucks) will be: 40.5 cents a mile for all business miles driven, up from 37.5 cents a mile in 2004; 15 cents a mile when computing deductible medical or moving expenses, up from 14 cents a mile in 2004; and 14 cents a mile when giving services to a charitable organization. The three-cent increase in the business mileage rate was the largest one-year rise ever. The primary reasons cited by the IRS for the increase were higher prices for vehicles and fuel during the year ending in September. The charitable standard mileage rate is set by law. NORTHERN KENTUCKY
“The reality is the Greater Cincinnati region is borderless to our visitors,” said John T. Taylor, chairman of the Greater Cincinnati CVB and President, PNC Bank, Ohio/Northern Kentucky Region. “People come to this area to see the great attractions on both sides of the river. By joining our tourism efforts together, we will be able to focus and extend marketing dollars in a more effective and efficient way to bring more visitors and the economic benefits they generate to our region.” Mike Conway, chairman of the Northern Kentucky CVB, said the new approach “makes sense on many levels, organizationally and financially.” The decision to join tourism forces was made following a study by a joint tourism committee. A report from that study recommended the creation of a new tourism-focused entity to better capture a portion of the growing leisure market. The report noted area’s existing approach was fragmented, resulting in diluted marketing messages and diminished purchasing power. Both CVBs will maintain independent efforts and bring greater focus to drawing larger meetings and conventions to drive business to their separate convention centers and hotels. Taylor added that it is hoped that in the future other regional tourism entities in the area will join in the effort. Scott Usitalo, an executive from Procter & Gamble, is on loan to serve as the organization’s interim director. LOUISVILLE
The Young Engineer of the Year Award recognizes young NSPE members who have made outstanding contributions to the engineering profession and their communities during the early years of their career. Kelly graduated with a Bachelor of Science in mechanical engineering from the University of Louisville’s Speed Scientific School in 1993. Soon after graduating, Kelly volunteered to be a missionary in Iraq helping the Kurds drill for water. Due to outbreaks of violence, he was redirected to Ethiopia, where he spent three years developing water resources and road projects for remote villages. He has since returned twice, for two-week project tours, to continue the work he started years before. Kelly now serves as director of marketing for Strand Associates in Louisville and is also very involved in national and local engineering and professional societies, including NSPE, Kentucky Society of Professional Engineers (KSPE), Society of Military Engineers (SAME), Society for Marketing Professional Services, and the American Council of Engineering Companies (ACEC). Kelly was selected as the SAME Young Engineer of 2003, and the KSPE Young Engineer of the Year for 2003. VERSAILLES
STATE
In the third and final round of public voting, “Unbridled Spirit” tallied 11,298 votes, while “Where Legends Are Born” collected 4,633. The branding campaign began in October, when Governor Ernie Fletcher presented four brand options to the public and announced that the people’s votes would determine which brand would ultimately represent the Commonwealth. Public interest was high, with more than 55,000 votes pouring in between Oct. 26 and the close of voting on Nov. 21. Jack Couch, executive director of the Kentucky Council of Area Development Districts, said he liked not only the horse theme, but the human-spirit aspect as well. With this catchphrase, he said, “we’re telling the country and the rest of the world that we don’t set limits… that Kentucky’s here, we’re rolling our sleeves up and we’re doing whatever it takes to make Kentucky a great place to live and do business.” “Every successful company has a slogan or a brand that becomes identified over time with that company’s quality and integrity,” said D. Ray Gillespie, executive director of the Kentucky Hotel & Lodging Association. “Hopefully, a single brand that can be identified with Kentucky will be something that we can all be proud of and that will help us to improve and expand market share, just because of its recognizability.“ The new brand will be placed on state advertising, signs, stationery, brochures, Web sites and other information that comes from the Commonwealth. A new Web site, www.KentuckyUnbridledSpirit.com, has been developed to showcase how the brand may be used and offers logo merchandise for sale.
REGION Indiana and Tennessee have been listed as being among the nation’s best locations for biotechnology companies by Business Facilities, a national magazine that provides monthly site selection information for more than 40,000 executives. Indiana tied with California on the list for sixth place overall, but ranked third and fifth in the drugs/pharmaceuticals and medical devices/equipment sectors, respectively. Tennessee ranked 11th overall, but was recognized as the third best location in the area of agricultural feedstock and chemicals. Indiana is home to a number of major pharmaceutical companies, including Bristol-Myers Squibb, Mead Johnson, Pfizer, Bayer and Eli Lilly, which has its world headquarters in Indianapolis. The magazine noted that Nashville, Tennessee is “well known for nurturing entrepreneurial, innovative healthcare companies,” while Memphis offers a “prime distribution advantage for biotech businesses” via its FedEx superhub and an extensive truck and rail system. The Knoxville/Oak Ridge area was noted for its “established and substantial research centers. OHIO Honda Transmission Mfg. of America, Inc. will add 100 new jobs at its plant in Russells Point, Ohio as part of a $100 million expansion to add production of high-precision transmission gears to its current production of automatic transmissions. The expansion is part of a broader $270 million strategy, which includes construction of a new automatic transmission plant in Georgia and added production of engine components at an expansion of Honda’s Alabama engine facility. The expansion in Russells Point, located approximately 60 miles northwest of Columbus, will increase Honda Transmission’s size from 361,000 square feet to 631,000 square feet. Honda’s investment in its Russells Point facility boosts its total investment to $261 million and will increase the total employment figure to 900. Transfer of the value-added production of high-precision automatic transmission gears to Ohio from Honda’ Hamamatsu plant in Japan will begin in 2006.
Business Briefs BOWLING GREEN
BUCKNER
CAMPBELLSVILLE
CARROLL COUNTY
CENTRAL CITY
COVINGTON
FRANKFORT
HEBRON
HIGHLAND HEIGHTS
HILLVIEW
LEXINGTON
LOUISVILLE
NORTHERN KENTUCKY
PINEVILLE
STATE
INDIANA
OHIO
TENNESSEE
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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. |
Responding to growing indications of a possible sale of LG&E Energy, Louisville Mayor Jerry Abramson met last month with the chairman of E.On AG, the German company that owns LG&E, in an effort to keep the utility’s 1,800 jobs and headquarters in Kentucky. 
Louisville-based Xodiax Data Centers has been sold to Peak 10, Inc., a company headquartered in Charlotte, North Carolina that is the Southeast’s leading data center and managed services provider. Terms of the acquisition were not disclosed.
Two Louisville business investors and a Western Kentucky maritime expert have been awarded with the 2004 Governor’s Economic Development Leadership Award, an honor designed to recognize individuals whose vision and leadership have been instrumental in improving Kentucky’s local, regional and statewide economy.
The 2005 Agri-tourism Competitive Awards Program is a $1 million competitive funding program for agri-tourism businesses and regional agri-tourism marketing efforts. Applications for the competitive awards will be accepted in two rounds in 2005: February 1 and August 1. Applications will be scored according to a pre-determined, specified criteria, of which highest points will be awarded to projects that show viability and have significant impact on multiple producers. 
The $500 million project is expected to create up to 700 construction jobs at an average of $60,000 a year, resulting in $1 million in revenue for Clark County from payroll taxes during construction. When complete, the plant will create a new market for up to 1.2 million tons of coal each year and generate enough electricity to supply 19 cities the size of Winchester. 
The Greater Cincinnati and Northern Kentucky Convention and Visitors Bureaus are joining marketing efforts to drive more tourists and visitors to the region by forming a Cincinnati regional tourism organization.
Clay Kelly, a director with Strand Associates in Louisville, has been named by the National Society of Professional Engineers as the 2004 Young Engineer of the Year. 
In an easy win over three rivals, “Unbridled Spirit” has become Kentucky’s new brand.
In compiling the listing, Business Facilities looked at four primary biotech sectors: agriculture feedstock and chemicals, drugs and pharmaceuticals, medical devices and equipment, and research and testing. 
Western Kentucky University has officially opened its new WKU Leadership Center, providing a central location for leadership instruction programs and activities for students and the general public alike. In addition to meeting and resource rooms, the center houses the Leadership Studies Program, an academic program that offers certificates in leadership at the undergraduate or graduate levels. Other current programs available at the Leadership Center include the Faculty Fellows Program and various seminars and workshops for students and other interested people. 
Bendix Commercial Vehicle Systems has announced plans to invest $5.8 million to overhaul its manufacturing plant in Frankfort, where it produces air compressors used in air-brake systems. The Ohio-based company is a supplier of air brakes and other components for commercial vehicles. 
Construction has begun on Jewish Hospital’s new $32 million outpatient surgery, diagnostic and emergency care facility in northern Bullitt County. According to Brian Doheny, president and CEO of Jewish Hospital Medical Center South, Bullitt County is federally designated as a health professional shortage area and is also the largest county in Kentucky without a hospital. The Bullitt County Economic Development Agency projects Bullitt County’s population to increase from 66,000 to 74,000 between now and 2008. The new two-building medical complex, located on a 19-acre campus, is scheduled to open in Spring 2006.
Tempur-Pedic International Inc. (NYSE: TPX) has filed with the Securities and Exchange Commission a registration statement for a secondary public offering of shares of its common stock. Ten million (10,000,000) shares of common stock will be offered by certain selling stockholders. The underwriters will also have an option to purchase up to an additional 1,500,000 shares from the selling stockholders. The company will not be selling any shares. The sale is expected to raise approximately $187 million for the Lexington-based company, which manufactures and distributes mattresses and pillows utilizing a special visco-elastic material initially developed for NASA. 
Papa Johns’ International, Inc. is continuing its international expansion with the addition of its first restaurants in Trinidad, Peru, Bahrain and Oman. The Louisville-based pizza chain opened its first international restaurant in Mexico City in 1998 and now operates more than 2,800 restaurants in the United States and 18 international markets. According to Bill Van Epps, chief operations officer for Papa John’s, in the past year the company has nearly doubled the number of countries with a Papa John’s presence has more than 600 international restaurants slated to open over the next seven years.
John Conti Coffee Co. has acquired Pinnacle Beverage Co. of Nashville, a distributor of Flavia gourmet coffees, teas and other hot beverages. With the acquisition, which includes more than 400 accounts, comes Pinnacle’s distribution rights for the extensive line of Flavia products in the state of Tennessee. John Conti has been awarded distribution rights for Flavia products in Kentucky, West Virginia, southern Ohio, southern Indiana and southern Illinois. 
PNC Bank has announced plans to open at least 10 new branches in the Greater Cincinnati/Northern Kentucky area in the coming 12 to 18 months. The banking company has also installed some 50 additional ATMs, placing them in all Walgreen’s drug stores in the region.