Business news in brief

In the Region

Sidhu reduces initial public offering 40 percent

Sidhu Special Purpose Capital Corp., the blank-check firm run by former Sovereign Bancorp Inc. chief executive officer Jay Sidhu, cut its planned initial public offering 40 percent to $90 million. The firm, which originally planned to raise $150 million, will now sell nine million units for $10 each, according to a filing with the Securities and Exchange Commission. Each unit has one share and one warrant to purchase a share for $6.50. Special-purpose acquisition companies, or SPACs, have no operating business and are formed to acquire another company or its assets and take them public. Investors bet on the ability of the management team to complete an undisclosed deal. Only two blank-check initial offerings have been completed since March as global IPOs have fallen to a three-year low. - Bloomberg News

Royal Bancshares suspends quarterly dividend

Royal Bancshares of America Inc., Narberth, said it temporarily eliminated its quarterly dividend to strengthen its balance sheet and conserve cash during the economic downturn. The bank, which has 22 branches, had cut its dividend by 48 percent in January. Royal Bancshares said it added $4.5 million to its provision for loan losses. That pushed down its second-quarter earnings to $152,000, compared with $4 million in the same period a year ago. Royal Bancshares has been struggling with bad construction loans. At the end of March, the bank had $41.9 million in bad loans on its books. That amounted to 6.4 percent of its total loans. The bank's shares were down 4 percent, or 38 cents, to close at $8.96 on Nasdaq. - Harold Brubaker

Web-tool provider StarCite fills CEO position

StarCite Inc., the Philadelphia provider of Web-based tools to help companies manage meetings and events, named Gregory J. Dukat as CEO. He is the former president and CEO of Atlanta-based Ventyx Inc., and succeeds Michael Boult, who stepped down March 18. Boult had been CEO since October 2005. StarCite is a venture-backed company; Internet Capital Group Inc., Wayne, owns a 33 percent stake. StarCite doesn't disclose its financials, but Inc. magazine said StarCite had 2006 revenue of $24.2 million. It employs 351 people worldwide. - Michael Armstrong

Wilmington Trust reports $19.5 million loss

Wilmington Trust Corp., citing problems at an affiliated company, Roxbury Capital Management, and other woes, said it lost $19.5 million, or $0.29 per share, during the second quarter. A previously disclosed charge of $66.9 million from the decline in the value of Roxbury reduced net income by $43.5 million, or 64 cents per share on a diluted basis, the company said. Also the carrying value of the firm's investment portfolio went down $12.6 million, mostly due to declines in the carrying value of Fannie Mae and Freddie Mac securities. Wilmington Trust said its regional banking business added $483 million of loans during the 2008 second quarter - the largest three-month increase in the company's history. Loan balances topped $9 billion for the first time, the holding company said. - Henry J. Holcomb

Loan papers from fire-hit businesses due soon

The deadline is approaching for federal disaster recovery loan applications from businesses damaged in the Nov. 8 fire that ripped through the Town & Country Apartment complex in Norristown, killing one resident and sending many to shelters. The Small Business Administration said businesses have until Aug. 15 to apply for loans of up to $1.5 million, at 4 percent interest. Applications can be downloaded at http://go.philly.com/SBA. Those loans may be used for debt payment, operating capital and payroll costs, the SBA said. - Henry J. Holcomb

Phila. institute gets $100 million Navy contract

American Competitiveness Institute of Philadelphia said it had been awarded a $100 million contract from the Navy's Office of Naval Research. The contract will, over the next five years, "enhance and promote communications, corporation, integration and interdependency across the defense industry that will result in improvements in affordability and performance of defense platforms and weapons systems," according to the announcement by ACI chief executive Alan J. Criswell, - Henry J. Holcomb

Knoll gets a bounce after report of sales increase

Shares of Knoll Inc., East Greenville, closed up 4 percent yesterday after the company announced that its second-quarter net sales of $292.5 million marked a 7.5 percent increase over the second quarter 2007. The commercial-furniture manufacturer based in Montgomery County reported operating profit of $35.1 million, or 12 percent of net sales, a decrease of 6.6 percent from last year. The company cited a onetime restructuring charge of $3.4 million. Net income was $20.9 million, an increase of 19.4 percent over last year. The company said it had repurchased 1.1 million shares of stock for $13.9 million during the second quarter, compared with 0.7 million shares for $16.3 million during the second quarter of 2007. Knoll said it expects third-quarter 2008 revenues to be in the range of $266 million to $272 million, an increase of 5 percent to 7 percent over last year. Company shares closed up 58 cents at $14.98. - Roslyn Rudolph

Penn Virginia competes Lone Star purchase

Penn Virginia Resource Partners L.P., Radnor, said it has completed its previously announced $160 million purchase of gas-gathering and pipeline assets of Lone Star Gathering L.P. in the Fort Worth Basin in Texas. In addition, Penn Virginia will pay $5 million in December 2009, and agreed to revenue targets by June 2013. PVRP is a publicly traded limited partnership formed by the Penn Virginia Corp., also of Radnor. Shares closed up 16 cents at $24.26. - Henry J. Holcomb

Encorium and a partner get drug-trial contract

Encorium Group Inc., Wayne, announced the signing of a contract for $5.1 million for a Phase 2 clinical drug trial to be conducted by Encorium and its Argentine partner. The name of the company sponsoring the drug trial was not disclosed. Encorium, which designs and manages clinical trials for the pharmaceutical, biotechnology, and medical device industries, will be partnering with Estudios Clínicos Latino América in South America. - Roslyn Rudolph

Elsewhere

Former Bear Stearns pair may face more charges

Former Bear Stearns Cos. hedge fund managers Ralph Cioffi and Matthew Tannin, indicted for fraud and conspiracy last month in the first case stemming from a federal probe of the mortgage-market collapse, may face more charges. The two men were accused June 19 of misleading investors about the health of two hedge funds that failed last year. The implosion helped trigger the credit crunch and the eventual collapse and sale of Bear Stearns to JPMorgan Chase & Co. "The government is indeed contemplating additional charges," Assistant U.S. Attorney Patrick Sinclair said at a preliminary hearing in Brooklyn federal court, adding that any new counts would be added by "early fall." Sinclair declined to say what charges are being considered. Both defendants have pleaded not guilty. - Bloomberg News