Fast Lane — A compilation of economic news from across Kentucky
LEXINGTON: Bingham McCutchen Law Firm to Bring 250 Jobs to Support New Global Services Center
Bingham McCutchen, an international law firm based in Boston, plans to open a global services center in Lexington that will bring 250 jobs to central Kentucky.
Lexington Mayor Jim Gray called the firm’s announcement “the best news we’ve had since the recession started in 2008.”
The company is investing $22.5 million to establish the shared-services center, part of a transformation initiative to enhance the performance of Bingham McCutchen’s administrative operations.
Bingham employs more than 1,000 lawyers and 900 support staff in offices on three continents. The Lexington center will eventually house approximately 250 employees, who will be relocating from existing Bingham offices or hired from the Lexington area. The center will provide finance, accounting, human resources, information technology, operations, marketing, communications, research and knowledge services, as well as risk management functions that are unique to law firms.
The average wage for those jobs, including employee benefits, is $37 an hour, according to the Kentucky Economic Development Finance Authority (KEDFA), which has preliminarily approved tax incentives for the company of $6.5 million.
The transition of Bingham’s administrative functions to its new center in Lexington is anticipated to begin in April and continue through the spring of 2014. The center will be located in the University of Kentucky’s Coldstream Research Campus business park.
Bingham selected Lexington because of its access to a deep and dynamic workforce, a developed academic community and a vibrant quality of life, among other factors, according to L. Tracee Whitley, CEO of Bingham McCutchen.
“The commonwealth of Kentucky and the city of Lexington joined forces to offer us the most competitive incentives package of the metropolitan areas we considered,” Whitley said.
SHEPHERDSVILLE: Fashion Retailer Nasty Gal to Hire 300 for New Bullitt County Distribution Center
An international online fashion distributor plans to locate a 527,000-s.f. national distribution center in Shepherdsville that will create 300 new full-time jobs.
Nasty Gal is a global online fashion destination for women that originally started as an eBay store in 2006, selling a selection of vintage clothing. Since then, founder Sophia Amoruso has grown the business into an international company that offers new and vintage clothing, shoes and accessories to customers in more than 50 countries.
Nasty Gal Chief Operating Officer Deborah Benton said the company chose Shepherdsville “not just for its central location, but also for its people and culture” and said it would bring its core values of “respect, fun and a strong focus on customer service” to Bullitt County.
“Because of announcements like this, Bullitt County has become what I think is the nation’s best destination for companies that want to expand their distribution centers and boost their online presence,” said Rep. Linda Belcher, of Shepherdsville.
The Kentucky Economic Development Finance Authority preliminarily approved Nasty Gal for tax incentives up to $3 million through the Kentucky Business Investment program. The performance-based incentive allows a company to keep a portion of its investment over the term of the agreement through corporate income tax credits and wage assessments by meeting job and investment targets.
HEBRON: iHerb Products Center to Create 600 Jobs in Boone County
iHerb, a California-based food supplement online retailer, has announced plans to establish its e-commerce headquarters in Northern Kentucky, bringing up to 600 jobs to the region.
Based in California since 1996, iHerb is an online provider of more than 30,000 natural products and food supplements. The company’s new 200,000-s.f. e-commerce center will be located at IDI’s Park West industrial park in Hebron.
iHerb’s Sept. 21 announcement follows significant job announcements made earlier this year by four other e-commerce and distribution logistics companies that plan to locate in the area.
In March, global logistics company DHL, which operates a hub at the Cincinnati/Northern Kentucky International Airport, announced plans to expand its operations there with a new $47 million mail sort facility and the addition of 300 jobs
In June, NorAm, a New Hampshire-based company that buys and distributes overstock and wholesale media products like video games, DVDs and CDs, moved its headquarters to Hebron. The company now employs some 225 people and plans to add another 50 to 75 jobs this year.
Later in June, national e-commerce logistics company Elovations announced plans to invest $13.7 million to establish a new e-commerce center in Boone County that would bring some 700 full-time jobs to the region.
Amazon.com wrapped up the summer with a late August announcement that it would be adding 900 full-time positions and 5,000 seasonal workers at its fulfillment center in Hebron.
Cliff Cowing, iHerb’s director of strategic planning and analytics said, “We know the Northern Kentucky workforce is strong and the geography favorable – two primary factors for choosing our location at Park West.”
LEXINGTON: Tempur-Pedic Purchase of Sealy Creates a $2.7B Company
Lexington-based mattress manufacturer Tempur-Pedic International Inc. has acquired bedding manufacturer Sealy in a $1.3 billion transaction. The combined companies will create a $2.7 billion global bedding company.
“This is a transformational deal that brings together two great companies, each with globally recognized brands,” Tempur-Pedic CEO Mark Sarvary said. “Tempur-Pedic and Sealy together will have products for almost every consumer preference and price point, distribution through all key channels, in-house expertise on most key bedding technologies, and a world-class research and development team. In addition, our global footprint will span over 80 countries. The shared know-how.”
Founded in 1992, Tempur-Pedic is the leading manufacturer of mattresses and pillows made from its proprietary pressure-relieving material and under the Tempur and Tempur-Pedic brand names.
With roots dating back to 1881, Sealy is a leader in the manufacturing and marketing of a broad range of mattresses under the Sealy, Sealy Posturepedic, Stearns & Foster and Bassett brands. The company operates 25 plants across North America and more than 11,000 retail outlets and is also a leading supplier to the hotel industry.
Tempur-Pedic and Sealy will continue to operate independently. Sealy CEO Larry Rogers, who has been with Sealy for 33 years, will remain in that position and will report to Sarvary.
STATE: Trail Towns Program Helps Put Adventure Tourism on the Map
Kentucky has launched a new program to help small communities that want to promote adventure tourism opportunities in their area.
The Trail Towns program is a designation and assistance program that will help communities guide travelers to trails, food, lodging, campgrounds, museums, entertainment and other services.
Communities that qualify as Trail Towns are located along long-distance trails, an extensive trail system or a river used for canoeing and kayaking.
Once a community receives the Trail Town certification, its services and attractions will be highlighted on maps, websites, visitor’s guides and other state promotional material. As of August, more than 30 communities had started the application process to become a Trail Town.
STATE: Ky’s Career/Tech Education Systems Unite to Operate More Efficiently
In a move to help produce the skilled workforce needed by Kentucky businesses, Gov. Steve Beshear has signed an executive order to overhaul the state’s career and technical education (CTE) system.
The order unites the state’s two CTE systems under the guidance of Kentucky’s Department of Education. The goal is to create a unified, more relevant and efficient system to educate and prepare students for the world of work in a real-life setting.
“Career and technical education directly connects learning and jobs for our students and provides them with engaging real-world opportunities so that they can transition to higher education or employment with ease,” said Kentucky Education Commissioner Terry Holliday. “This move is a key strategy in our efforts to ensure college and career readiness for all students.”
Educators, businesses and administrators across the state are already working together to make these programs more accessible earlier in the education process, more academically rigorous and better aligned with postsecondary requirements and employer needs.
Studies show that graduation rates are higher among students who participate in CTE programs and are then more likely to transition to postsecondary education or employment.
LEXINGTON: LA Fitness To Acquire 36-Site Urban Active Fitness Chain
California-based fitness chain LA Fitness has announced that it will acquire the assets of Urban Active, a fitness club chain headquartered in Lexington.
Financial details of the acquisition were not released.
Urban Active was founded in 2007 by Lexington businessman Royce Pulliam and has grown to include 36 facilities located in Kentucky, Georgia, Nebraska, North Carolina, Ohio, Pennsylvania and Tennessee. According to Club Industry magazine, Urban Active had an estimated $107.5 million in revenue in 2011, making it the ninth-largest health club chain in the country.
LA Fitness ranked No. 2 on the Club Industry listing, with 500 locations in 22 states and $1.2 billion in revenue in 2011. LA Fitness presently has only one location in Kentucky, which is in Crescent Springs.
In a Sept. 10 statement released by LA Fitness announcing the planned acquisition, the company said, “While the parties are hopeful that the transaction will be completed within the next several weeks, there can be no assurance as to when or whether a closing will occur.”
If the Urban Active acquisition is completed, it will be LA Fitness’ third acquisition in less than a year. In Nov. 2011, the company purchased 171 Bally Total Fitness Clubs and added 32 Lifestyle Family Fitness clubs in Florida this past July.
STATE: Baptist Healthcare Rebrands, Expands its Ky. Hospital Network
Baptist Healthcare System Inc. has rebranded its health system as Baptist Health, a name that it says better reflects the scope of services that the Louisville-based organization provides.
The Louisville-based company owns six acute-care hospitals with more than 1,500 licensed beds in Corbin, LaGrange, Lexington, Louisville and Paducah, and last month announced that it has added Pattie A. Clay Regional Medical Center in Richmond to its network of hospitals.
Baptist has been managing Pattie A. Clay since 2010, when it entered a three-year management agreement with the Richmond hospital. Pattie A. Clay serves residents in Madison County and the surrounding area through several locations, including the main hospital, outpatient facilities, an instant-care center, a wound care clinic, an occupational medicine center and physician practices.
Baptist Health also manages Hardin Memorial, a 300-bed acute-care hospital in Elizabethtown, and in August announced that it would begin managing Russell County Hospital, a 25-bed critical access hospital in Russell Springs.
Since its founding in 1924, Baptist Health has grown significantly. According to figures released by the company, one of every six inpatients and one of every nine outpatients in Kentucky in 2010 received care at a Baptist hospital.
LOUISVILLE: Mountjoy Chilton Medley Merges With McCauley Nicolas CPAs
Mountjoy Chilton Medley, Kentucky’s largest full-service accounting firm, and McCauley Nicolas CPAs & Advisors, the largest southern Indiana CPA firm in the Louisville metropolitan area, have merged.
The combined firm will retain the Mountjoy Chilton Medley (MCM) name.
The merger, which was effective Oct. 1, will also combine the two firms’ independent wealth-management operations – Capital Asset Management LLC and Meritrust Wealth Management LLC – to form a full-service registered investment advisor and financial services firm. The combined group will maintain the Meritrust Wealth Management name and will bring the financial advisor count to seven with approximately $500 million in assets under management.
This is the fourth merger in the past three years for Mountjoy Chilton Medley, a firm created in November 2009, when Chilton & Medley LLP merged with Mountjoy and Bressler LLP. In August 2010, MCM merged with Hawkins Company LLC, a Louisville-based CPA firm specializing in financial institutions, and in November 2011, MCM added Pat McCafferty, CPA, a Cincinnati-based accountant specializing in the hospitality industry.
With the addition of McCauley Nicolas, MCM now has offices in Lexington, Frankfort and Louisville, Ky.; Cincinnati, Ohio; and Jeffersonville, Ind., and employs more than 110 CPAs.
PIKEVILLE: UPIKE Unveils $40 Million Facility For College of Medicine
Hundreds gathered last month at the University of Pikeville to witness the official ribbon-cutting ceremony for the new home of the Kentucky College of Osteopathic Medicine (KYCOM).
Funding for the $40 million educational facility included grants from the James Graham Brown Foundation and the Appalachian Regional Commission, and a low-interest federal loan.
“Many people and companies have made significant contributions to this project, but the coal industry in particular has been extremely generous during a difficult economic struggle,” said University of Pikeville President Paul E. Patton. “The coal industry has sustained this region and this university, and we appreciate it. For that reason, the University of Pikeville Board of Trustees has named this building The Coal Building in honor of that industry and the coal miners who are the backbone of our society.”
The 87,000-s.f. Coal Building includes research and teaching laboratories, an osteopathic manipulative medicine lab, classrooms, offices, study space and a new cafeteria.
LEXINGTON: Chinese Coal Equipment Company to Open Lexington Plant
Birtley, a Chinese-owned company that produces coal equipment processing machinery, plans to locate a manufacturing facility in Lexington, making it the first Chinese-owned manufacturer in the commonwealth.
The company, a subsidiary of Shandong Borun Industrial Processing Equipment in China, is investing some $10 million in the project and plans to create 30 to 50 new full-time jobs. The 67,5000-s.f. facility will be located on 5.7 acres in Lexington’s Blue Grass Business Park. Operations are expected to commence in May.
“Lexington is a very diversified community, and we appreciate all the support we are receiving from the city and the community,” said Birtley President Bing Chen, whose company worked with the World Trade Center Kentucky and Commerce Lexington in making the decision to locate in Lexington. “We hope the Birtley facility will be as successful as our other facilities in China.”
Shandong Borun has three manufacturing facilities in China. The company’s products include machines used in coal preparation, mineral processing, and devices used in the power, steel, cement and port industries.
Although the U.S. coal industry has been struggling of late, Chen told the Lexington Herald-Leader that his company’s products actually benefit from the more stringent environmental laws that require the coal to be more refined.
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