The Tennessean from Nashville, Tennessee on June 3, 1998 · Page 35
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The Tennessean from Nashville, Tennessee · Page 35

Nashville, Tennessee
Issue Date:
Wednesday, June 3, 1998
Page 35
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CLASSIFIED BUS 4E EH 5E JL- Local stocks Mutual funds TO Hunting (or some fun? Try 189 recreation ads m Pages 6-20E WEDNESDAY, JUNE 3, 1998 Early out nets millions for Banner co-owners By CANDY McCAMPBELL Staff Writer Irby C. Simpkins Jr., who acknowledged yesterday that he and partner Brownlee 0. Currey Jr. received $65 million as the price to terminate the agreement between The Tennessean and the Nashville Banner, says he plans to invest in new media and entrepreneurs. Simpkins, former publisher of the Banner, and Currey, its chair-man, had asked Gannett Co. Inc., owner of The Tennessean, to end " the Dec. 4, 1937, business agreement under which the two newspapers operated. The Banner closed Feb. 20, ending the partnership. :, Simpkins and Currey received $65 million from Gannett rather than continue to share profits with vmuiicu iui uic uic ui uic ugl cement, scheduled to end in 2015. Craig Moon, publisher of The Tennessean, said: "The Banner was lUUUVVUlg LUC UCI1U3 UI II1U31 Ul LNX11 afternoon papers, and the termination price was a fair return on investment considering The Tennessean would now shoulder all the future business risks for 18 years." Simpkins and Currey, however, ended up with less than $65 million. Simpkins said they repaid a $14 million loan to Gannett, put up $1.4 million In severance benefits for the Banner employees, and were liable for taxes on the money. Simpkins is now chairman and 1 stockholder of Brentwood-based EdgeNet Media, an Internet service provider. At EdgeNet, he is combining his experience in media and business with the computer and Internet experience of Tim Choate. EdgeNet nrpcinpm nnn rnipr pvptiiiivp nm. i cer. Tr;trirH Cntortoinmont Cf olc : -has a 10 interest in the firm. Simpkins and Currey, along with i then-partner John J. Hooker Jr., i bought the Banner from Gannett in 1979 for $25 million. Simpkins said i they invested another $9 million in i the paper. , The Banner had been operating under a joint operating agreement with The Tennessean and later Gannett Under the JOA, the pa-! pers combined advertising sales, printing and circulation operations ' while maintaining separate and competing newsrooms. . The Banner had been collecting . about 21 of JOA profits, a share - scheduled to drop to 16.5 in two years. Circulation of the Banner i had dropped from 42,100 in Sep-i tember 1997 to 39,839 four months ! later, and declines were expected to continue. "Customers will see positive changes in our stores. The reorganization of our financing will provide needed capital, give us some 'breathing room' and actually assist us in doing things even better." JAMES DEMME, Bruno's chief Ei(09 molt daedkm- ByUSABOHAVPCS Stat Vinur Bruno's Inc. may be in bankruptcy. But not everybody is writing off the Birmingham, Ala.-based chain's area supermarkets. Despite selling a string of stores this year, Bruno's has no plans to sell its Brentwood, Franklin and Bellevue sites, company executives insist Nor are the seven FoodMax stores owned by the company throughout the Midstate on the block. Industry analysts say it's more likely the company will concentrate on improving its 197 stores, to start bringing in revenue and make the company profitable. "Since they've gone into bankruptcy, part of their debt has been forgiven, so they're dealing from a more stable platform as far as feeling the financial pressure," said Chuck Gilmer, editor of the regional grocery trade publication The Shelby Report, out of Gainsville, Ga. He noted that Bruno's sale of 23 stores, including 10 in Memphis, took place in ... b .':.sss, - -C"' ' ..- . January, shortly before the Feb. 2 filing of Chapter 11. Those sales were influenced by the fact that Bruno's had a large debt payment due, Gilmer said. "Their position in Nashville remains to be seen, but a lot of the pressure to divest from stores was before the bankruptcy," he said. Since declaring bankruptcy, Bruno's has not sold or bought any stores. Steve Slade, senior vice president at Bruno's corporate headquarters, said the company was "not in talks with anyone at this time." "In our business, the rumors go on constantly," Slade said. "No sale or merger is happening." An emphasis on beefing up current service at existing stores was emphasized by James Demme, Bruno's chairman, president and chief executive officer. "Customers will see positive changes in our stores," he said. "The reorganization of our financing will provide needed capital, give us some 'breathing room' and actually assist us in doing things even better." From a high of $13.50 last August company stock has hit virtually rock bottom, trading below $2 a share since late February and closing yesterday at $1.06. And Bruno's financial sheet is not encouraging, either. The company reported a net loss of $49.5 million for 1997. Net sales for 1997 decreased $338.8 million, or 11.7 from the previous year. The company closed or sold 23 stores in this time: the 10 Memphis stores, under the name Seessel's, were sold to Mississippi: 6 SOURCE: Bruno 8 I Albertson's Inc.; the 13 stores in Georgia were sold to Asheville, N.C.-based Ingles Markets. Albertson's, the fifth-largest supermarket chain in the nation with more than 900 stores, is actively expanding in existing and new markets. Last month the Boise, Idaho-based company announced plans to open 380 new stores over the next five years. When asked if Albertson's was looking to buy the Bruno's stores in Nashville, Albertson's spokeswoman Jenny Enochson said, "The company does not confirm or deny rumors." Working in Bruno's favor is Demme's past experience as CEO of Homeland Stores hie. He turned that Oklahoma City company around from bankruptcy in 1996 to now being a smaller, albeit profitable, business. "He has a good reputation and the experience of leading a company out of bankruptcy," The Slielby Report's Gilmer said. Also of help to Bruno's recovery is the surge of growth expected in the supermarket industry. The Food Marketing Institute, a non profit association based in Washington, D.C., reports that prepared meals are driving supermarket growth, as grocery stores compete with restaurants. "No question, the industry is growing Tennessee: 13 This year, Bruno's sold 10 Seessel's stores to Albertson s Inc. Alabama: 125 Georgia: 36 Bruno's reach States with Bruno's supermarkets This year, Bruno's sold ; 13 of its stores to Ingles Markets Florida: 17 FILE Chef Jason Moore works on one of the hand-tossed pizzas available at Vincent's Market Inside Bruno's. The chain offers freshly made gourmet food Items to draw shoppers. Bruno's stock falls The price of Bruno's stock has bottomed out this year as the company reorganizes itself since declaring bankruptcy in February. A look at Bruno's stock prices over the past six months: High 122987 $5 , $419 j I Yesterday: ! $1.06 Low 5898: 75 cents Dec 19 Jan. 2 Jan 16 u Dec. 5 1997 . 1 1998 SOURCE Bloomberg News Jan 30 Feb 13 Feb 27 March March 13 27 May May June more sophisticated in ' meal solutions," ' said Tim Hammonds, Institute president and CEO. "Supermarkets are keenly focused on consumer demands for convenience, quality and val ue. In addition to more ready-to-eat items, supermarkets are increasingly adding nongrocery services, such as pharmacies and banks, the Institute reports. A look at one of Bruno's biggest area competitors, Kroger, bears this out The Cincinnati-based chain is adding a store in Murfreesboro and on Highway 100 in west-em Davidson County, as well as remodeling the Bellevue and Belle Meade stores. Most of these stores will include a 30-minute photo-finishing service and expand Kroger's U-Scan Express program, which offers customers hand held scanners to avoid checkout lines. "We continue to take whatever actions are necessary to protect our market share," said Ross Thomas, Kroger spokesman. "Several Bruno's have opened up here and we continue to watch those stores." A combination of internal and external obstacles is blamed by industry observers for Bruno's falling into bankruptcy. The company was "a real shooting star in the grocery industry" about eight years ago, Gilmer said. Then, in December 1991, the founding chairman and vice chairman of the company, brothers Angelo and Lee Bruno, were killed in a plane crash. "The company never really recovered from that loss of leadership," Gilmer said. LEIGH singleton staff Turn to PAGE 2E, Column 3 1 i 4ii Columbia sells home-health units Analyst calls it a 'fire sale' By JULIE BELL Staff Writtr " ColumbiaHCA Healthcare Corp. yesterday announced agreements to sell its home-care operations in 11 states for $34 million, and said it expects to have deals to sell the rest by the end of September. The pending sales to Baton Rouge, La. -based Amedisys Inc. and an investor group led by a former Hospital Corporation of America executive were greeted positively by analysts, who viewed the moves as a fulfillment of ColumbiaHCA 's pledge to shrink and concentrate on its hospital business. But details of the deals also show how far the company's home-care business, which specializes In home-bound patients, has fallen. As recently as 1996, home care was the engine that generated $1 billion, or more than 5 of Colum-blaHCA's $18.8 billion in revenue. Information given yesterday by the company and buyers indicates total revenues in Columbia HCA's home-care division have fallen to less than half of that The company has said bad publicity surrounding the federal fraud investigation into Its billing practices, which is focused partly on home care, caused some doctors to send patients elsewhere. The erosion in business contributed to a $22 million first-quarter loss in discontinued operations, units ColumbiaHCA intends to sell or spin off. But It was unclear until now Just how bad the erosion had become. "In terms of the financial consideration, it's an absolute fire sale of Ore. Idaho Wyo. Sell off ColumbiaHCA Healthcare Corp. is selling home-care units in 11 states, with those in six states -including Tennessee - going to Amedisys Inc. "" Amedisys, Inc. rl Private group ot investors j 'Alaska' jA -? - r Kan. -- oWa. ' ' Ny Ala. Ga. J SOURCE CommtMlCA Healthcare Corp. these home-care assets," Morgan Keegan & Co. analyst Joseph Mill-sap said. But, he added, "What's most important is Columbia is suc- KENT TRAVIS STAFF cessfully exiting the home-health business enabling a more rapid ne- Turn to PAGE 2E, Cohimn 3 Airport prepares for future of travel By MICHAEL DAVIS Staff Wnttr Soaring U.S. air travel shows .10 signs of descending, and the Industry's chief regulator says the nation had better gear up to manage the growth. "It's an extraordinary time to be In aviation. It's never been more vital," said Jane F. Garvey, administrator of the Federal Aviation Administration. "But its very vitality also presents extraordinary challenges." Officials for Nashville International Airport agree. They expect local passenger boardings to grow by almost two-thirds in the next eight years. And they cite $33 million in parking and road Improvements slated to start this summer as among the efforts to keep up with the volume. "We're in a better position than a lot of airports around the country," said Carole Willis, director of communications for the Metropolitan Nashville Airport Authority. "I think we'll be ready." In Nashville for the American Association of Airport Execu-tives' annual conference, Garvey predicted that air travel will continue to boom well into the next decade, fueled by a strong economy and a rebound from the industry's early-1990s recession. Almost 600 million domestic Turn to PACE 2E, C otumn 3 Business Editor: Lisa Green ZG3-8CS8 Assistant Business Editor Bill Choyke 664-2156 Personal Finance Editor. Candy McCampbell 259-8076 Fax: 259-8093 E-mail tips: , , For Norma ton or questions, .call Mooday through Friday, 9 a.m. to 5 p.m. rrm The Art of Investing In Mutual Funds," by Dennis Covington, Investment broker, J.C. Bradford & Co., noon tomorrow, J.C. Bradford & Co., Green Hills office, 2000 Richard Jones Road, Nashville. No fee. Reserve with Ammee Mercadal, 463-4850 or (888) 448-3703. Improving Organizational Performance through 8ystemt Redesign: Proven Approaches for Health Care Providers," with George Whetsell, president of Whet-sell & Associates, by Hospital Shared ServlcesAmerlNet, 9 a.m. tomorrow, Nashville Airport Marriott. Fee: $245. Info: (800) 837-5800, ext. 262. Coming tomorrow Worried about kdns No. 1? Try sales job Competition is all around us, In personal and professional lives. But there is a profession that one can be very successful at without having to come In No. 1, No. 2 or even No. 22. You guessed It. Sales. In sales, you can be a big or little shot; or like most of us, an in-between shot, according to columnist Harvey Mackay. Tomorrow In Business Service Merchandise Co. narrves Cnmortin senior VP TTTTI GILMARTIN Service Merchandise Company, the Brentwood-based retailer, has appointed Jane Gilmartin to senior vice president of hardlines merchandising. In addition to leading the acquisition and merchandising of all home products, Gilmartin will be a member of the executive committee. She was most recently vice president of merchan- Worries about profits keep stocks from gaining Technology stocks recovered partially from yesterday's bruising selloff, but the broad mar ket again failed to hold most of their gains as mounting wornes about company profits prevailed. Broad-market indicators were mixed, with the technology-laden Nasdaq composite Index wiping out about half of Monday's 32-point plunge. The Bloomberg Tennessee Index was 224.29, down 7? Rtnrv unrl hl.; on 4-fiF. f STCC! "

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