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Archive: February, 2013

POSTED: Tuesday, February 26, 2013, 3:42 PM

Montgomery County (suburban Philly) brothers Thomas and Gerald Greenberg have filed a federal lawsuit alleging that multinational brewer InBev's Anheuser-Busch, the U.S. brewer of Budweiser, Michelob and their industrial-beer cousins, has systematically exaggerated how much alcohol is actually in its brews, Bloomberg court reporter Sophia Pearson writes here.

The brothers, who say they've been pounding away more than a case of Bud derivative a week (between the two of them) for the past four years, say they've figured out that Bud doesn't really contain 5 % alcohol, as advertised. They convinced Philly lawyer David Senoff to file the suit.

"We know because Anheuser-Busch takes several readings in each line in each brewery 24 hours a day" and uses the data to water the beer down to, or below, the promised alcohol content, Josh Boxer, a lawyer for the Mills Law Firm, San Rafael, Calif., which is coordinating multiple weak-beer suits, told me. (No relation to U.S. Sen. Barbara Boxer, D-Calif., he affirms.)

POSTED: Monday, February 25, 2013, 4:24 PM

UPDATE: Justin DiBerardinis, aide to Philadelphia City Councilwoman Maria Quinonez-Sanchez and veteran of the Business Privilege Tax reforms, says his office has been reviewing city Use & Occupancy taxes and comparing the recent increase to the city's Actual Value Initiative reappraisals. He finds:

"The AVI windfall for Commercial and Industrial property owners (the types of property that pay U&O) is currently looking to be about 90 million dollars," even as "thousands of small neighborhood based commercial properties... are in line for big increases.

"In other words, big commercial properties are getting even a bigger break than that $90 million figure indicates.

POSTED: Friday, February 22, 2013, 12:35 PM

Standard & Poor's Ratings Services has cut its credit rating for Good Samaritan Hospital, the nonprofit (originally Episcopalian) institution that handles a majority of hospital cases in Lebanon County, Pa. east of Harrisburg, by three notches, from BB+ to just B+.

The cut leaves Good Sam firmly in the "junk bond" category (bond sales people prefer to call it "high yield"), which leaves an issuer's bonds off limits for many insurance companies and other high-quality investors, forcing the issuer to pay more when it borrows money or refinances existing debt.

"We based the downgrade on what we view as persistent high operating losses," which makes it tougher to pay investors, Liz Sweeney, credit analyst for S&P, said in a statement. Losses at recent rates "will soon begin to erode" Good Sam's cash reserves, despite the hospital's careful spending practices. Good Sam has lost money in 8 of the past 10 years, including "a sizable operating loss" in 2012.

POSTED: Friday, February 22, 2013, 10:49 AM

"In the world of Excel geeks, this will be like the Sports Illustrated swimsuit issue," promises Philadelphia investment banker Andy Greenberg, of the formula he and Graham Frazier, partners in West Conshohocken-based GF Data, have put together after seven years of tracking U.S. mid-market company sales.

Greenberg and Frazier say they have crunched 1,600 transactions by more than 200 investment-banking firms -- enough to separate short-term market trends and "identify clear benchmarks" that inject more science into what practicioners have sometimes claimed is the "art" of pricing what a family business or private firm is worth.

Their joint venture, GF Data, has sent their benchmarks and their reasoning to the Private Equity Professional Digest. Greenberg says he expects their model will be published in that journal next week.

POSTED: Friday, February 22, 2013, 10:19 AM

Wilmington, Delaware, which is roughly the same size as rundown Camden, N.J., further up the Delaware River, remains "America's Corporate Capital," with a white-collar downtown office center that's a banking, legal and corporate headquarters and the titular home of more than half the Fortune 500, thanks to business-friendly courts, low corporate fees and a long history of activist business leadership and accomodating politicians.

But Moody's Investors Service says Wilmington's city-government fiscal outlook remains "negative," as Delaware's largest community looks to refinance $37 million of its $285 million  public debt.

In his report, analyst Dan Seymour praised the city's "conservative and forward-looking" financial management under new mayor Dennis P. Williams, and the "substantial corporate and commercial presence" by DuPont, Bank of America, JPMorgan Chase, Capital One and other corporations whose buildings tower over the partly-renovated Market St. retail and theater district and the Christina riverfront.

POSTED: Thursday, February 21, 2013, 2:20 PM
An animated neon Heinz Ketchup bottle that was once on the company's North Side factory in Pittsburgh, now sits atop the Senator John Heinz History Center in Pittsburgh, Thursday, Feb. 14, 2013. Billionaire investor Warren Buffettís Berkshire Hathaway and its partner on the deal, 3G Capital, is dipping into the ketchup business as part of a $23.3 billion deal to buy the Heinz ketchup company. (AP Photo/Gene J. Puskar)

"Investors are being confronted with a string of mergers and acquisitions and leveraged buyouts," which means more companies are taking on big debts and pushing "aggressive financial policies," warns Peter N. Ribgy, analyst at Standard & Poor's Ratings Services, in a report to clients today.

Dealmakers on Wall Street and lawyers like Philadelphia-based Dechert LLP's D.C.-based M&A antitrust team are raking in fat fees on all these deals. The Dechert team headed by Paul T. Denis and ex-FTC lawyer James A. Fishkin are antitrust counsel to Office Max in its $2.3 billion merger with Office Depot, to US Airways in its $11 billion merger with American Airlines, and to Medco in last year's $29 billion merger with Express Scripts Inc.

For stock-watchers who gathered at the Consumer Analysts of Greater New York's yearly conclave, last week's planned $23 billion+ takeover of Pittsburgh condiment maker Heinz by Warren Buffett's Berkshire Hathaway raises the "inevitable question" of "Who's Next?" writes Jonathan Feeney, food company analyst at Janney Capital Markets in Philadelphia, in a report to clients today.

POSTED: Wednesday, February 20, 2013, 4:27 PM
FILE - In this Dec. 3, 2009 file photo, a sign outside the Comcast Center, left, is shown in Philadelphia. (AP Photo / Matt Rourke)

Philadelphia's belated Actual Value Initiative real estate tax reassessment, which rewards owners of declining buildings with lower city and school payments while punishing the owners of improved real estate with higher property taxes, has also resulted in lower assessments for the owners of Center City's office towers, compared to recent building sale values, as my colleague Harold Brubaker notes here.

Some of the "market values" look lowball. 1701 John F. Kennedy Boulevard, the Liberty Property Trust-built Comcast Center tower, last changed hands in a 2007 transaction for more than $500 million, or $400+ a square foot, but is listed at around $200 million, or under $180 a square foot, in the new AVI. (This is mostly an academic difference: like other new commercial construction, Liberty's German owners will pay city taxes only on the land, not the tower, til it's 10 years old.)

Elsewhere, "on average the typical Market St., 18th St., South Broad St. office buiding" in center City "is going to see about a 20 percent decrease in property tax," Robert Fahey, veteran broker at CBRE's Philadelphia office, told me after spending a few hours reviewing the new assessments.

POSTED: Wednesday, February 20, 2013, 3:31 PM

With Amazon setting up delivery bins at colleges and convenience stores -- replacing the Post Office -- while Google goes retail, too, setting up phone stores -- wouldn't it be cheaper for those cash-rich chains to take over an ailing retailer with locations in every retail district around the country?

Like, say, Radio Shack, writes Gina Chon at here.

For just $325 million in stock market value, plus a suitable premium, the buyer picks up more than 4,000 locations in high-traffic areas, she notes.

About this blog

PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at, 215.854.5194, @PhillyJoeD. Read his blog posts at and his Inquirer columns at Bloomberg posts his items at NH BLG_PHILLYDEAL.

Reach Joseph N. at or 215 854 5194.

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