Friday, October 24, 2014
Inquirer Daily News

POSTED: Tuesday, October 14, 2014, 3:13 PM

As clients move from in-house computer servers and enterprise software to remote cloud-based servers and smartphone-compatible applications, which have so far proved less lucrative, two Philadelphia-area business computing giants have cut a deal to cooperate on a new offering.

Unisys, the Blue Bell computer, software and services company, will bundle realtime analytics based on SAP's HANA database software into its Forward by Unisys server systems, Unisys chief executive Ed Coleman told clients at its Universe 2014 trade show in Dallas today. SAP, based in Germany, has its U.S. headquarters in Newtown Square, where CEO Bill McDermott is also based.

The Unisys deal is "proof of SAP's success as a platform company at the forefront of industry trends," SAP spokeswoman Cindy McKendry told me. SAP has announced a separate HANA distribution deal with IBM's SoftLayer unit. 

POSTED: Tuesday, October 14, 2014, 1:01 PM

Buyers of U.S. companies worth $10 million to $250 million are borrowing more money and coming across with less of their own cash investment, says Philadelphia investment banker Andy Greenberg, a partner in GF Data, which tracks deals by more than 200 midmarket investment banks.

It's not that banks, which cut back on deal finance in the 2008 financial meltdown, are back again making more and cheaper loans -- it's that business-development companies (BDCs) and other private lenders are willing to take on more risk and bidding up prices, Greenberg tells me.

The "void" left by banks "has been filled by non-bank financial institutions with greater risk appetites and fewer regulatory restrictions," Greenberg says. Pressured by BDC competition, mezzanine funds and other lenders that once offered high-interest-rate debt "subordinated" to cheaper "senior" bank loans have instead been offering one-size-fits-all "uni-tranche" financing at or below 10% interest rates.

POSTED: Tuesday, October 14, 2014, 12:42 PM

Anthony Weagley, new chief executive of Malvern Federal Savings Bank, said he's going to tour the bank's seven branches to listen to customers, starting with a noon visit to the Exton branch on Oct. 23.  Weagley says his goal is to improve services and make Malvern "the bank of choice on the Main Line." 

Weagley's predecessor, Ronald Anderson, left last winter after activist investors including Joseph Stilwell complained about Malvern's weak financial performance. The bank, formerly a depositor-owned mutual company that first sold shares to the public in 2012, wrote down $20 million in bad loans last year.

Weagley was hired by bank owner Malvern Bancorp with a mandate to grow, chairman F. Claire Hughes Jr. said in this statement last month. Shares have traded above $11 recently, up from a May 19 low of $10.15 but still below the recent high of $12.94 on Oct. 1. 

POSTED: Sunday, October 12, 2014, 8:59 PM

UPDATE: Penn State says it arrested an unnamed 20-year-old student at the school's main campus and plan to charge him for threatening to bring assault rifles to school and "kill everyone."

Police said the student, who lives off campus, told them it was just a "prank," but Penn State police chief Tyrone Parham said in a statement that "alarming an entire community is not considered a joke," and "this individual will be held accountable."

EARLIER: Penn State University police "will have an increased presence" at the Hub, the State College campus's student center and food court, after students reported an anonymous Saturday night social-media post threatening a shooting attack.

POSTED: Sunday, October 12, 2014, 6:04 PM
The start of 'The Show', an hourly water show at The Pier. Photo taken at The Pier, at Caesars Hotel & Casino, Atlantic City. (David M Warren / Inquirer)

Philadelphia developer Bart Blatstein says he and casino architect Paul Steelman have agreed to buy the four-story, 300,000 sq. ft., half-empty Caesars Pier shopping center in Atlantic City for a small fraction of its construction cost. (See also in the A.C. Press and Phila Business Journal). 

A person familiar with the deal said Blatstein and Steelman agreed to pay $2.8 million, less than 2 percent of the $200 million plus that developer Taubman Centers Inc., of suburban Detroit, and other investors plowed into the center in the mid-2000s, according to company filings. The partners hope to close the deal later this year.

"I love Atlantic City. I grew up going to the Shore. And this is the best time to buy there," with casinos shutting down and property values cratering, said Blatstein on Sunday. "For those who think A.C. is done for, they are out of their minds. This is a great opportunity to come back into Atlantic City."

POSTED: Friday, October 10, 2014, 8:57 AM

Watching the last Gov. Tom Corbett vs Tom Wolf campaign debate, reader Rick Dreyfuss writes from Hummelstown: "I find it bizarre how Tom Wolf defends this financially-flawed pension reform plan (Act 120, which trimmed future state pension eligibility without addressing the multibillion-dollar pension funding deficit), then proceeds to criticize the Governor on the resulting successive (Pennsylvania state) credit downgrades -- which are due in large part to the persistent and chronic pension underfunding abetted by this same Act.

"Gov. Corbett then correctly attacks Act 120 as being a poor bill -- but touts his accomplishments in contributing the Act 120 (staggered state-funded pension payment) rates over the past four years. Further, he and other (Republicans) support the hybrid plan concept, which would not address underfunding." Dreyfuss, a self-employed actuary, is former director of compensation at Hershey Co., senior fellow at the conservative Commonwealth Foundation and adjunct fellow at the Manhattan institute.

Separately, the Stanford pension scholar Ann Headley sent me a note complaining Pennsylvania doesn't seem serious about either raising pension funding or cutting pension payouts. She says a Harvard lawyer helping with her project says the state-controlled school board's attempt to suspend Philadelphia's public school teacher union contract is a shocking sign of how tough this fall's political campaign has gotten, and it's no wonder pension reform is getting "little traction."

POSTED: Thursday, October 9, 2014, 1:25 PM

From the day it reopened in 2002 until last July 4, veteran hotelier John Daily had one of the most visible jobs on the Jersey Shore: He was general manager at Congress Hall, the massive Cape May hotel-restaurants-party complex. Built in the distant days when the gingerbread resort town was a summer home to Presidents and the powerful, restored after long neglect, on Daily's watch Congress Hall grew into Cape May's living room, one of the best-known properties of Cape Advisors, the hotel group founded by Shore native Curtis Bashaw and New York investor Craig D. Wood.

But this summer, Daily moved north to run The Reeds at Shelter Haven, a rival year-old resort in the downtown of affluent Stone Harbor. The Reeds is owned by Drexel Hill oncologist Dr. John Sprandio and investor Edward Breen, a New Hope-area native and former chief executive of Tyco International, the Princeton-based industrial conglomerate, where Breen made a fortune spinning off profitable businesses.

"These things come out of the clear blue sky," Daily said of his move. "Opportunity knocks and you seize the moment."

POSTED: Thursday, October 9, 2014, 10:54 AM
Auxilium's testosterone-replacement market is declining.

Endo International Plc, a drugmaker run largely from Malvern, Chester County, but incorporated in Ireland where it can avoid U.S. taxes, says it has convinced directors of sexual-dysfunction therapy-maker Auxilium Pharmaceuticals, based in Chesterbrook, to sell Endo the company for $2.6 billion in cash and debt, including $33.25 (in cash or stock) for each Auxilium share. Statement here.

That's a 55 percent premium to Auxilium's stock market value on Sept. 16, when Endo offered $2.2 billion, a premium Auxilium said wasn't enough.  Endo boss Rajiv De Silva called the fatter deal a win for investors in both companies "as well as for patients, customers and employees."

But while Da Sliva said he's looking forward to "working with the Auxilium team," his company also said it "expects the combined company to achieve annual cost synergies of approximately $175 million," in addition to Auxilium's previous plan to cut expenses $75 million this year. The combined cuts add up to more than half Auxilium's $469 million in operating expenses for 2013. The earlier cuts included firing more than 200 of Auxilium's 639 workers.

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 JoeD@phillynews.com or 215 854 5194.

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