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Address lists are hot sellers
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Cement business -a hard buck PAGES
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Feds investigate mobile home business PAGE 7
WEEK OF JUNE 3 - 9,1985 VOLUME 1 0 NO. 18
Detroit could be major U.S. rail gateway BY BRADFORD WERNLE CRAIN'S DETROIT BUSINESS
Detroit could become a major gateway between Canada's industrial heartland and the U.S. Midwest and Southwest if a railroad tunnel under the Detroit River can be enlarged by its new owners. Canadian National Railways Ltd. of Montreal, which bought the 8,373-foot-long tunnel from Consolidated Rail Corp. in Philadelphia, will study the feasibility of enlarging the structure so it can accommodate much larger railroad cars. James Stratton, a spokesman for Canadian National, said the railway is accepting bids on the feasibility study, which
LATE NEWS
should be completed in three or four months. At that time, the railroad will make a determination whether to continue with the project, he said. The tunnel descends under the Detroit River just southwest of Detroit's main post office, which is located at West Fort and Eighth streets. The study seeks to determine whether walls of the tunnel can be enlarged to accommodate specially designed railroad cars which carry automobiles, semi-trailers, and other oversized loads. Stratton could not be specific about what kind of changes might be made to the tunnel, but estimated the project could cost about $7 million (U.S.). The money would be a portion of the estimated $41 million (U.S.) that Canadian Na-
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tional and CP Rail would spend to upgrade a jointly-owned line between Niagara Falls, Ont., and Detroit. The line, formerly called the Canada Southern Railway, was purchased for $25.2 million (U.s.) from Conrail. Canadian National took over operation of the 74-year-old tunnel May 1 from the Detroit River Tunnel Co., which is owned by Conrail. A group of American investors including Stroh Brewery Co. had fought to buy the tunnel. The Canadian Transportation Commission rejected the Stroh-led bid in favor of the Canadian National-CP Rail offer. "That price ($25.2 million) was a steal," said Jeffrey See GATEWAY, PAGE 26
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Renaissance Printing goes Chapter 11 Financially troubled Renaissance Printing Inc., which recently applied for a $900,000 loan package from government agencies, has filed for Chapter 11 reorganization in the U.s. Bankruptcy Court for the Eastern District of Michigan. The company has assets of approximately $1 million and owes $2.9 million to 289 creditors, according to court records. Renaissance Printing's debt includes $1.4 million in back taxes, which would be partially paid off with money from the loan package. Chapter 11 permits a debtor to continue operating its business while attempting to work out a court-approved plan to repay creditors. Renaissance Printing said it will meet with its creditors June 26 at the U.s. Courthouse in Detroit. Court records show Renaissance Printing has secured debt of more than $1 million; unsecured debt of more than $1.3 million, and priority debt of about $1.4 million. Twelve employees recently left Renaissance Printing and joined Securities Press Inc., a competing financial printer based in Detroit. Renaissance Printing was ranked as the second-fastest growing privately-held Michigan firm by Inc. magazine last year.
Grand Prix: generic? As Grand Prix IV draws near, a Big Rapids company has been hit with a permanent injunction that prohibits it from selling any merchandise bearing the words "Detroit Grand Prix" or the Detroit Grand Prix logo. The company, Detroit Grand Prix T-Shirts Inc., had been selling various items with the Grand Prix logo, both wholesale and retail, since 1982. See LATE NEWS, PAGE 2 ~
Do lqUJexpect MJearnln9Sr--J to e In 19(5?
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Blues'late payments irk suppliers BY STEVE RAPHAEL CRAIN'S DETROIT BUSINESS
24.5% No (
50% Yes Less than 10% Decline 4.4%
SLiDEWORKS INC.
Local businesses feel confident about 1985. Graphs are less than 100 percent because of the no response category.
Survey fmds small, mid-sized local businesses optimistic BY BETTY LOU KITZMAN CRAIN'S DETROIT BUSINESS
Small and medium-sized businesses in the metropolitan Detroit area are largely optimistic about the economy, according to a survey conducted during March and April by Touche Ross & Co., in cooperation with Crain's Detroit Business. But they are not content to sit placidly and watch the money roll in, the survey of about 500 businesses statewide indicates. Almost 50 percent of the respondents plan to focus management attention on cost control and reduction in 1985; 41 percent said productivity would be a priority, and 45.2 percent said they would zero in on marketing. "These results plus respondents' views of hiring and capital expenditures are impor-
tant signals for our economy," said Joseph Yarabek, Touche Ross partner in charge of the Enterprise Group, which services small and medium-sized companies. Questionnaires were mailed to 4,000 businesses in Southeast Michigan, Bay CityMidland-Saginaw, Lansing and Grand Rapids, and Toledo, Ohio. Responses were received from 498 individual businesses, reflecting a 12.5 percent return rate and giving the results a confidence or margin-of- error level of plus/minus 4 percent. . Respondents represented the top echelon of the companies surveyed. The largest group was involved in manufacturing, followed by wholesale/distribution, retail sales, service, construction, finance, high technology. See SURVEY, PAGE 26 ~
Suppliers of medical equipment to homebound patients say late payments from Blue Cross and Blue Shield of Michigan for durable equipment are causing them economic hardship. Joseph Kennedy, president of the Michigan Association of Durable Medical Equipment Companies (MADMEC), said in a May 20 letter to Blue Cross that "approximately 74 percent of our members did not receive enough money in April to cover their payroll." "As of this date in May," he wrote, "things have not improved - again due to the slowdown in carrier processing of claims." Some 30 of the association's 70 members are located in Southeast Michigan. Blue Cross officials concede there is a delay in payments to the suppliers, but they say the lag stems from the maze of rules imposed upon them by the federal government as it attempts to cut national health care expenditures. See BLUES, PAGE 26 ~
DWIGHT CENDROWSKI
Norman Lepage, who owns Norman's Eton Street Station in Birmingham, is one of several area restaurateurs building business with direct mail. Story', Page 3.~