Monday, September 22, 2014
Inquirer Daily News

POSTED: Friday, September 19, 2014, 10:28 AM
Bok High School at 9th and Mifflin streets in Philadelphia on June 4, 2013. (David Maialetti / Staff Photographer)

Lindsey Scannapieco's Scout Ltd. LLC says this morning that Philadelphia's state-controlled School Reform Commission and its cash-strapped school district have picked Scout over other applicants "to transform the historic, vacant Edward W. Bok School in South Philadelphia into a creative anchor for the burgeoning East Passyunk neighborhood featuring studios and live-work space for the maker community."

Update - Confirmed: the building is to be apartments, mostly. They're not saying how many.

The eight-story Bok, with its Art Deco trimmings, was designed by architect Irwin Catherine and opened in 1938. Scannapieco, daughter of Center City condo and apartment builder Tom Scannapieco, plans underground parking and ground-floor "temporary, artistic uses" that may be followed by retail or office uses.  More at

POSTED: Friday, September 19, 2014, 10:07 AM

Citizens Bank owner Citizens Financial Group Inc., of Providence, R.I., in its Form S-1 initial public share offering (IPO) documents as amended Sept. 8 (read it and more recent updates here), hopes to sell the public at least 140 million shares at around $24 a share, a little above the company's tangible book value, and a discount to the typical U.S. large regional bank (which trades at about 40% over book), writes Terry McEvoy, an analyst at the brokerage Stern Agee, in a report to clients today.

The cash will go, not to Citizens, but to its recent owner, Royal Bank of Scotland, which is trying to raise cash and cut expenses, McEvoy notes. Once it goes public, the company will trade under the ticker CFG. Citizens owns the former PSFS, Girard and Mellon Bank branches in the Philadelphia area, where it rivals PNC, TD and market-leader Wells Fargo for consumer and business accounts..

As part of RBS, "Citizens’ sub-par operating performance went either unnoticed or was acceptable," and the company "poorly executed" its Midwest expansion since buying Charter One Bank in 2004, McEvoy writes. Under new boss Bruce Van Saun (who I profiled here last year), McEvoy adds, "the company’s commercial banking business is producing solid results, whereas additional resources and management focus will be needed to improve the consumer platform, in our view."  

POSTED: Friday, September 19, 2014, 9:40 AM
A screen grab from the redesigned Region's Business web site,,

Region's Business, the regional journal backed by investor Raymond Perelman two years ago, has relaunched as Malvern-based monthly magazine with a smoother-looking Web site. The 130-page "Vision issue" arrived in the mail this morning,  with ad pages touting Comcast Business, Ceisler Media, Lamborghini, Waste Management, Bernie Robbins Jewelers, Weight Watchers, the Philadelphia chamber of commerce, some of the Big 5 Philadelphia-area universities, banks, lawyers, and quite a few real estate outfits. 

The online version, also up today, links the publication's staff and freelancer-written stories to recent coverage by the Inquirer and other newspapers, press releases, political coverage from Pennsylvania Independent, "sponsored" articles and columns by some familar civic boosters, including tourism promoter Meryl Levitz.

"The goal is to stimulate dialog on important business and public policy issues facing regional companies. In doing so our editorial focus is intelligent perspectives and features that cover areas of consequential importance to the region's economy," president James McDonald tells me. He was previously a boss at the Metro newspapers and the Washington Examiner. 

POSTED: Wednesday, September 17, 2014, 1:51 PM
Anthony S. Clark. (Photo from

UPDATE: An investigation into an abortive hedge-fund investment by the Pennsylvania State Employees' Retirement System has "found no evidence of illegality" by ex-SERS chief investment officer Anthony Clark, former acting Pennsylvania attorney general Walter W. Cohen told the SERS board in a letter made public today after a nine-month review. "Whether Clark intentionally misled the Board by seeking to conceal Tiger's poor performance is open to question," Cohen added.

Cohen's review focused on allegations about what Cohen called "possible misrepresentations and omissions" in Clark's disclosures of losses and fees from Tiger Management Advisors, a high-fee hedge fund recommended by Clark that unexpectedly lost money invested by SERS after one of its managers invested in gold. The review also looked at Clark's working hours and personal investing activities.

Cohen  agreed with the findings of a previous review by the Stradley Ronon law firm that SERS was not obligated to report Clark's handling of the Tiger investment to the Securities and Exchagne Commission, and added that as far as he can tell there is "no pending investigation underway by any prosecuting agency." 

POSTED: Wednesday, September 17, 2014, 9:19 AM
FILE - This Jan. 23, 2012 file photo shows the Dupont logo on sheets of Tyvek covering the outside wall of a home under construction in Springfield, Ill. (AP Photo/Seth Perlman, File)

Shares of DuPont Co. rose more than 4%, to above $68, in early trading today, after billionaire investor Nelson Peltz's Trian Partners, which makes a business of badgering old-line companies to cut costs, sell businesses, and otherwise enrich shareholders fast, dropped the polite public mask he's maintained since he started accumulating DuPont shares last year, and made clear he's had it with CEO Ellen Kullman's reluctance to break what he calls a value-destorying conglomerate into separate biotech and industrial-materials companies.

The insurgent shareholder also vented its disgust with DuPont corporate spending on "bureaucracy" and such centuries-old DuPont hometown Wilmington, Del. perks as the 217-room Hotel du Pont, the 1,252-seat DuPont Theatre, and the sprawling DuPont Country Club with its three golf courses (one named for the founding family, two for its ancestral homes of Montchanin and Nemours). (Kullman is a Wilmington native. Corrected, her father was not a DuPont employee.)

"DuPont's conglomerate structure is destroying value and needs to be broken up," Trian complains in a letter to DuPont's board. Trian says it owns DuPont stock worth $1.6 billion (not quite 3% of DuPont, one of the oldest and smallest in the Dow Jones 30 Industrials index). - "Our board of directors and management team have taken firm action over several years that has delivered 220 percent total shareholder return since year-end 2008," vs. 155 percent for S&P 500, "by aggressively deploying our leading science," strengthening the mix of businesses, and "disciplined capital allocation," says DuPont. Read Trian's letter to the DuPont board, and DuPont's brief defense of Kullman's strategy. Highlights:

POSTED: Tuesday, September 16, 2014, 12:23 PM

1) RightCare, a Horsham patient-evaluation software maker, has raised $4 million from NewSpring Capital, Radnor, to build a national sales and marketing system. RightCare, which says it developed its Discharge Decision Support System (D2S2) software "through a decade of research" at Penn's Nursing school, was founded by CEO Eric Heil and Dr. Kathy Bowles. As part of the deal, NewSpring's Brian G. Murphy joins the RightCare board. In a statement, Murphy said RightCare's focus on "reducing readmission risk," as insurers and the U.S. government seek to cut hospital spending, gives RightCare "a tremendous opportunity to grow."

2) RJMetrics, a Center City firm that consolidates business data into a "cloud-based warehouse" for mobile, online and software-as-a-service applications, said Monday it has raised $16.5 million from new investor August Capital and past investors Trinity Ventures and SoftTech Venture Capital. The firm had raised $5.5 million from Trinity, SoftTech and "angels" previously. "RJMetrics plans to use the funds to hire more engineers" and expand its current base of 300 customers, according to RJMetrics cofounder and CEO Robert Moore. 

3) Cloudnexa, a Navy Yard-based cloud managed services provider that's an authorized reseller in the Amazon Web Services (AWS) Partner Network, says it has struck a deal with machine-data specialist Sumo Logic, security software maker TrendMicro and business software monitor AppDynamics to market a joint solution to government, healthcare, construction and other AWS clients. The deal allows the companies "to bundle with our managed-services solution," Cloudnexa chief executive Joel Davne told me. "A key part was getting them to convert their existing pricing models into utility pricing," with no lock-in requirement, "so they don't get soaked with professional service fees from traditional system integrators. It positions us nicely to meet more customer requirements." The company employ 15 and expects rising sales and a new investment round will fuel growth.

POSTED: Tuesday, September 16, 2014, 9:40 AM

Updated: With a cluster of fashion outlets like Neiman Marcus Last Call at its north end, and an expanded Walmart (at the former Boscov's site, replacing an older Walmart nearby) opening next week in the discount-store group at its south end, Simon Property Group  today renamed its 25-year-old, 1.8 million sq. ft., 2,500-worker shopping complex on Woodhaven Road in Northeast Philadelphia as "Philadelphia Mills." The owner has dropped the familiar "Franklin Mills" name and lighting-bolt logo, and replaced its green-and-orange building-blocks doorways with simpler orange-on-brown gates.

"We needed to take the project in a new direction. This is not the same Franklin Mills you might remember from 25 years ago," Gregg Goodman, president of Simon's Mills discount-shopping group, told me. Walmart has demolished part of the old space to make room for its new store. "Some of the spaces from when the property was first built had depths that were not appropriate for today’s retail," Goodman said.

Simon has sold or spun off many of its smaller shopping malls to concentrate on a handful of large properties that it hopes serious shoppers will see as day-long destinations. The company also controls the giant King of Prussia shopping complex, one of the largest on the East Coast, where it is connecting the Plaza and Mall through a corridor of new stores; the Philadelphia Premium Outlets at Limerick, Montgomery County, and South Jersey's Gloucester Premium Outlets, where construction started last month; plus Montgomery Mall, among other area properties.

POSTED: Monday, September 15, 2014, 5:16 PM

Of 22 states where for-profit water companies operate, Pennsylvania is the most business-friendly, and has been since he started keeping track in 2011, writes Ryan M. Connors, water and farming analyst at Janney Capital Markets. (Delaware, Ohio and Illinois also get high marks; Iowa, California, West Virginia and Maryland are at the other end of the scale, limiting private profits for public utilities.) 

But the outlook for higher profits is bleak, Connors adds, in a report to clients. "The industry will remain in bunker mode" as long as the middle class is not "participat(ing) in the economic recovery" and state regulatory commissions try to help voters by "trying to keep a lid on rate increases."

So utilities are trying to boost profits by, for example: providing water to energy fracking operations (American Water) and "aggressive repair-tax accounting" (Aqua America). 

About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at or 215 854 5194.

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