The Indianapolis Star from Indianapolis, Indiana • Page 21

Finance The Indianapolis Star TUESDAY, JULY 30, 1985 PAGE 21 New panel to help businesses statewide Off The Tape ROM STAR WIRE SERVICES Landmark fur sale The Rockefeller family announced plans to make a $11 billion public stock and bond offering as part of a financing package that will make Rockefeller Center, a landmark office building complex in the center of Manhattan, a publicly held property for the first time. The financing package will be made on behalf of Rockefeller Center Properties a real estate investment trust. It is one of the largest initial public offerings by an American company in history. GNP forecast lowered The Reagan administration lowered its prediction for 1985 economic growth but insisted a sharp rebound in economic activity would occur in the second half of the year. The new fore --1 cast calls for growth in GNP of 3 percent this year, down from an April projection of 3.9 percent Some private economists called the revised forecasts still far too rosy, given the soaring foreign trade deficit.

ASSOCIATED PRESS Tennessee Gov. Lamar Alexander, at microphone, and members of the state legislature welcome the General Motors Saturn plant to their state. It's official; Saturn to Tennessee mm Enlarged" Nashville Spring Hill employment as product and manufacturing engineers, product development designers and materials management specialists and said the positions were "the first of many soon to be available." GM has committed $5 billion to starting up Saturn Corp. and its manufacturing plant in an attempt to beat Japanese automakers at making and selling small cars. The Saturn complex will include two foundries, a plastics plant and other parts plants.

It will make heavy use of robots in a fully automated, paperless work environment; and GM expects eventually to be able to make half a million cars a year, twice the output of today's most efficient plants. A preliminary contract proposal endorsed by the United Auto Workers union leadership would give workers permanent job security and an equal voice with management in business decisions, and a pay plan that includes quarterly performance and attendance bonuses to increase worker output. After the first car rolls out of the plant in 1989 or 1990, Saturn customers would be able to order a car via computer for delivery in two weeks. By TIM BOVEE ASSOCIATED PRESS Detroit General Motors Corp. said Monday it had made a tentative decision to build its Saturn car-making plant at Spring Hill, ending an eight month competition in which 36 states courted GM for the plant.

The plant will provide 6.000 jobs directly and as many as 20.000 jobs in related businesses. William Hoglund. president of GM's Saturn said construction of the manufacturing and assembly complex in Tennessee depends on the outcome of discussions with state, local and utility officials. The talks will cover such items as access roads, education and training for employees, environmental matters, taxes, water, electricity, natural gas and sewers. Hoglund said.

He said Saturn's headquarters would be in Troy, and a center for 450 engineering employees would be in Madison Heights. Mich. Both are Detroit suburbs. Monday's announcement was the first confirmation from GM that Spring Hill, a city of 1.100 people 30 miles south of Nashville, would be the plant site. TENNESSEE 1 ALA GA.

0 miles 75 UPI Graphic Strike talks begin Representatives of Western Union and striking United Telegraph Workers met for the first time since the 2 day old walkout by 6.500 employees began. The company refused to budge on its proposal to lay off more than 1,500 employees and contract out work to non-union members, a union official said. About 2.000 nonunion staffers are keeping Western Union offices open. Union officials said the strike could cripple the financially troubled company. AMC eyes alliance American Motors Corp.

may form a joint venture with a Japanese automobile company. Automotive News quoted AMC President Jose Dedeurwaerder as saying that AMC would make an attractive partner (or a similar-sized company in Japan. Speculation is that Subaru would be a logical candidate for AMC because both specialize in front-wheeldrive vehicles. AMC. 46 percent-owned by the French carmaker Renault, is the only American automaker without a Japanese partner.

'USA Today' overseas Gannett Co. said it would print its USA Today international edition in Europe, starting next May. The newspaper chain said it had contracted with Ringier the publisher of Switzerland's largest newspaper, to print USA Today via satellite in Zurich. The international edition now is printed in suburban New York and shipped by air to 30 other nations. Japan opens markets Japan said it would make a The announcement came as GM began seeking workers for its Saturn subsidiary with half-page newspaper advertisements, published in Monday's editions of the Detroit Free Press and The Detroit News, sought applications for Indiana lost but learned from bid By JEFF SWIATEK STAR STAFF WRITER The Indiana Commerce Department announced Monday the formation of a new division to help existing businesses in the state.

The Division of Business Expansion, with an annual budget of $2 million, will combat the impression that state government concentrates on luring outof state firms to Indiana and overlooks companies that are already here, said Lt. Gov. John M. Mutz. "We know our best source of new jobs and new business will continue to be the existing structure of business in our state," said Mutz, who announced the creation of the division at news conferences in the Statehouse and in South Bend, Fort Wayne and Evansville.

He said the division would consolidate four economic development functions in the Commerce Department: export promotion, procurement of defense contracts, minority business development and regulatory assistance. About 22 people have been assigned to the division. Its director is Kurt G. Ellis, 29. who directed the department's Community Economic Development Division.

The new division's goals are to market the state's business help ser- vices more aggressively, to consider forming new programs and to "monitor" the financial status of manufacturing companies, Ellis said. The monitoring will be done with the help of the state Employment Security Division, which last year began surveying manufacturing businesses around the state to check on their well being, he said. Although 58 percent of the Commerce Department's economic development funding now goes to Indiana businesses, Mutz said. "That is a statistic that is often not believed by existing businesses in the state of Indiana." The lieutenant governor, who oversees the Commerce Department, said the new division would help companies expand and try to prevent the closing of plants by offering low-interest loans, employee retraining grants and help in cutting red tape. "There are a number of Indiana companies that still do not realize the kind of services and kind of programs that are available," Mutz said.

He added that the state's failure to attract General Motor new Saturn auto plant was unrelated to the formation of the new division. GM said Monday that the Saturn plant would be built in Tennessee. State banks announce merger plan Merchants National Corp. and Central National Bank of Greencas-tie announced on Monday plans to merge. Their agreement calls for an exchange of stock and cash totaling $9.5 million.

The merger is subject to approval by regulatory agencies, the boards of directors of both banks and the shareholders of Central National. Established in 1883 by a group of Greencastle farmers and businessmen. Central National has assets in excess of $78 million and is the largest bank in Putnam County. Merchants has assets of $2.4 billion and is the third largest bank in Indiana. No changes are planned in Central National's management or board of directors.

The financial institution will continue to operate as Central National Bank, said Otto N. Frenzel III, chairman of the board of Merchants National Corporation. Mace Aker, president of Central National, said Merchants and Central have had a working relationship for a long time. The merger will be beneficial because the state's new banking law makes Central "no longer isolated," he said. Merchants will be able to provide services that Central alone couldn't offer and will help it compete with other banks.

This is the second merger agreement by Merchants National the first was with Farmers National Corp. of Shelbyville on June 3. Merchants has plans to merge with other central Indiana bank? and filed an application with the Federal Reserve Bank last week to acquire 17.5 percent of Hancock Bancshares. the parent company-of Hancock Bank and Trust. Greenfield.

Michigan officials lobbied heavily for Saturn. Locating corporate offices and engineering facilities in Michigan may be a compromise. When asked if political pressure may have influenced GM to split the corporate headquarters from the manufacturing operations. Mutz said. "I think that's completely possible." John Parish, Tennessee Gov.

Lamar Alexander's press secretary, said he wasn't sure whether political pressure caused GM to locate part of Saturn in Michigan. But he admitted, "We understood all the time (during the discussions) that home ties were important." Charles D. Preston of the Indiana Department of Commerce said GM wasn't specific about where Saturn's corporate headquarters would be during the talks he had with the company. Preston was one of Indiana's main contacts with GM during discussions about Saturn. Mutz started being less optimistic about Indiana's chances for Saturn recently.

"We've known for the last three or four weeks that there was no land optioning going on in Indiana," he said. That's a process GM usually goes through before it announces where one of its new factories will be located. One process GM doesn't go through is announcing states that have made a final list as a possible site for new facilities. Although several politicians said their states were on such a list, one never existed, GM's Postma said. It would make politicians look good if they could say their state was in the running for Saturn, Postma speculated.

"Everybody would like to be second," he said. "If they can't be that, they want to be third." Postirja did say there was a point during the selection process when some states were left out. But there never was actually a list. "In our own mind (there were) a half dozen sites we were looking at," he said. While admitting he was disappointed in the outcome, Mutz said the experience was good for Indiana.

The research about potential sites that the state did for GM can be used when Indiana tries to get other companies to locate here. For instance, the information can be transferred to the Chrysler-Mitsubishi talks. Mutz said. In a joint venture, those two companies are looking for a site to build a car assembly factory. Preston would not give specifics of Indiana's offer to GM for Saturn.

But he said the low-key approach would be used again if the state had it to do over. Tennessee's approach was low-key and it won. Preston pointed out. Many states offered incentives like paying Saturn's payroll for a certain period of time and building day-care centers for its employees' children. Indiana didn't make such offers.

Mutz has said he thinks GM makes decisions based on where it can do business effectively over the long run. By MORRIS D. WILDEY STAR ASSISTANT BUSINESS EDITOR It's official. Indiana won't be the site of Saturn, General Motors factory of the future that will make small cars. GM announced Monday that Saturn highly integrated manufacturing and assembly facilities will be built in Spring Hill, which is about 30 miles south of Nashville.

The announcement confirmed speculation that Spring Hill would get Saturn. But Monday's announcement did contain a surprise. Saturn's headquarters and engineering operations will not be located with the manufacturing operations. They'll be in Troy and Madison Heights. suburbs of Detroit.

The reason: "This is GM's headquarters." Donald Postma, a company spokesman, said of Michigan. William E. Hoglund, Saturn's president, was quoted in a press release as saying, "Michigan is the center of worldwide automotive technology, and we need to be close to the specialized facilities and expertise to complete our many development programs successfully." While it is true Detroit is a major automotive center, it is possible that Michigan politicians may have put pressure on GM to put Saturn in that state At least that's what Indiana Lt. Gov. John M.

Mutz thinks. GM officials are part of. the Michigan establishment. Mutz said. It's no secret that No fireworks in winning plant bid new attempt to open its markets to more imports over the next three years.

A new program is expected to streamline procedures for certifying imports, open financial markets to foreigners and give foreign firms wider access to government procurement bids. The program is the seventh in a series of trade packages that Japan has announced since 1981. The earlier packages dealt mainly with tariffs. Massive buyout offer A communications firm co-owned by television producer Norman Lear announced a tender offer for the privately held Evening News Association, which owns the Detroit News. A spokesman for the media chain said it wasn't for sale and would "vigorously oppose" any takeover attempt.

Evening News has 453.000 shares outstanding, putting the price tag of the takeover offer at $453 million. Evening News also owns newspapers in California and New Jersey, two radio stations and five television stations. Tire still treading on The longest-lasting automobile tire is the Michelin XH, which can run 66,000 miles under average driving conditions. The XH placed first in durability in a federal test of 134 radial tires from 18 companies. The ratings show all tire companies had good and poor mileage performers including Michelin's XWX, which must be changed every 20,000 miles.

that if they could ever get the Japanese on a level playing field, 'We could beat Alexander told Smith after taking him aside at the Gridiron dinner. "Well, they have a level playing field here in Tennessee." Alexander referred to the successful Nissan plant in nearby Smyrna that builds 250,000 trucks and Sentra subcompact cars each year and reports some of the highest quality and productivity of any American manufacturing plant. Saturn is designed to compete directly with Sentra and other inexpensive imports. Toyota also is interested in Tennessee, according to Alexander, and could well join Saturn and Nissan in the state when it makes a plant-location decision later this year. Key factors here include the state's location within a day's drive of 75 percent of the nation's consumers, low union presence and few labor interruptions, high productivity, low taxes and a pro business government, plus plentiful electricity, water and the most public money or the most unique incentive package that GM wanted.

It wanted the best, most competitive place to locate Saturn. And that need combined with the "strictly business approach" employed by Long, Tennessee commissioner for economic and community development, and his boss. Gov. Lamar Alexander, will yield rich dividends. Rather than follow the examples of others and take high-profile, low-yield trips to Detroit or appear on television with General Motors Chairman Roger B.

Smith as other governors did, Alexander met quietly with Smith in Washington and Memphis, and he drafted one of Tennessee's most prominent citizens, former Senate Republican leader Howard Baker, to use his considerable influence as well. Alexander and Smith first discussed Saturn's needs during the annual Gridiron Club dinner and media show in Washington in April. Alexander and Baker each talked again with Smith at a United Way dinner a few weeks later in Memphis. "The U.S. automakers have been saying By MICHAEL A.

LEWIS And CHARLIE CAIN THE DETROIT NEWS Nashville, Tenn. Tennessee state official Bill Long didn't think "balloons and firecrackers" would impress General Motors as much as a direct appeal to the automaker's competitive instincts. Other states offered huge enticements that included building day-care centers just for Saturn workers (Illinois), paying a big part of wages for the first year (Iowa), or matching what any other state had to offer (Michigan). Tennessee did nothing special to win Saturn but offer GM a "level playing field" on which to compete with Japanese automakers. Sure, GM will get some tax breaks, state-supported job retraining for some Saturn workers, and the completion of a dam near the prospective site with federal dollars incentives that cost only a fraction of what some states' billion-dollar packages offered.

But in the end, it wasn't the state offering i.