NEWSPAPER
© Entire contents copyri ght 1985 by Crain Communicati ons Inc . All ri ghts ·reserved .
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Gelman Sciences eyes consumer markets
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PAGE 7 ~Racetrack
rolls when sun shines PAGE 22
Office builders flock to Farmington Hills PAGES
WEEK OF JULY 15 - 21, 1985 VOLUME 1
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NO. 24
MichCon fights for steel business BY BRADFORD WERNLE CRAIN'S DETROIT BUSINESS
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DWIGHT CENDROWSKI
Main plant of operations in the Great Lakes Steel complex in Ecorse.
D.O.C. acts to bolster falling profits BY STEVE RAPHAEL
BY MARY SOLOMON SMYKA CRAIN'S DETROIT BUSINESS
Ase Inc. of Southgate envisions a major business complex on site near Metropolitan Airport.
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A Downriver company is about to launch a multimillion dollar development that it hopes will create a new business center Downriver. ASC Inc. plans to break ground this summer on several new company buildings near its existing complex at the intersection of 1-75 and North Line Road in Southgate. The company hopes to begin building an innovative car dealership complex next year. State and local officials plan to rebuild the intersection and widen North Line for seven miles from the project site west to Detroit Metropolitan Airport. ASC officials believe that the extensive development of ASC's 45 acres at the intersection could lead to development of the 411 acres all around the 1-75/ North Line intersection. ASC committed to undertake the expansion after working for more than a year with
community officials - especially the Downriver Community Conference - to develop Heritage Center, a plan to attract office and manufacturing developments to the 411 acres (including roads) owned by several individuals and companies, including ASC. ASC, which has 1,500 employees nationwide, is a privately-owned automotive supply and engineering firm. Its divisions include American Sunroof Co., Automobile Specialty Co., and Aeromotive Systems Co. The company is trying to upgrade the desirability of Downriver real estate, which is often compared unfavorably with real estate in other suburban Detroit communities. David Treadwell, ASC director of investment and real estate, said ASC and community conference officials felt that improving the 1-75/North Line interchange area would improve the value and appeal of the HeriSee ASC, PAGE 26
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Michigan National erects costly barrier s BY CHARLES CHILD CRAIN'S DETROIT BUSINESS
Michigan National Corp. has apparently thwarted Comerica Inc.'s takeover attempt. But See D.O.C., PAGE 25 ~ Michigan National's shareholders have paid a high price, say Comerica executives. COS ranks Last Wednesday, Michigan National erected public companies barriers that could prevent its shareholders from considering a buy-out offer for at least Who's No. 11 CraIn'. Detroit two years, and maybe as long as four. ~~c!; Robert Mylod, chairman and CEO of Michia complete comparison of sales gan National, said the company is protecting its and eamlngs, see pages 14 and sharehold.e rs until the era of interstate banking, 15. whhencthelr stock could fetch a far higher price ..._ _ _ _ _ _ _ _ _ _ _ _.... t an omerica was willing to pay.
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See STEEL, PAGE 26
Company launches Downriver 'center'
CRAIN'S DETROIT BUSINESS
In an attempt to boost slumping earnings, D.O.C. Optics Corp. will add at least seven new stores by the end of the year, cut waste in its 100 present stores, and introduce new products with a heavy promotional and advertising campaign this fall. Donald Golden, chairman of the board and president of the 39-yearold company, told stockholders at the annual meeting last week: "We've learned a great deal from the downturn. We're taking major steps to turn it around again." Earnings per share the first quarter of 1985 were 16 cents, compared to 31 cents for the first quarter last year, even though sales were $11.2 million, compared to $10.4 million for the first quarter of 1984. Company officials blamed the downturn on excessive inventory and inefficiencies in the Southfield-based company's stores, as well as competition from other eyeglass companies. Noting that his company re-
Michigan Consolidated Gas Co., competing to hold onto three major industrial customers, finds itself in a no-win predicament that could cause other customers to pay more for their gas. MichCon is giving discounts to three Detroit area steelmakers so the steel plants won't take their business elsewhere. The three used about 10 percent of all the gas the utility piped into Michigan last year. The discount is too much for the the Michigan Attorney General's Office. But it may not be enough to keep all the steelmakers as MichCon customers. The attorney general says the discount is unfair to the rest of MichCon's customers statewide because they are subsidizing gas
to the steelmakers below cost. The Attorney General's office estimates that the subsidy will cost the average residential ratepayer $10 to $15 per year. It filed suit in Ingham County Circuit Court in May to stop the practice. MichCon argues that if it loses the steelmakers, gas bills for everyone else will rise because the utility's fixed costs will be spread among fewer customers. Without the steelmakers, the average residential ratepayer will have to pick up about $20 more per year in fixed costs, said spokesman Fred Schell of MichCon. MichCon is the state's largest distributor of natural gas. While the haggling continues, one steelmaker - the Great Lakes Steel Division of
Employees and shareholders should not "have t o give up the rewards and long-term value of their efforts to a raider who wants to take over the company at bargainbasement prices," said Mylod. Even without the defensive measures, however, Michigan National said its rival's offer was "insultingly low" and that Comerica had little bargaining room to t ake over its target, Mylod the state's third largest bank holding company. No. 2 Comerica withdrew its acquisition offer Thursday. But Comerica executives said they still planned to seek permission from the Fed-
eral Reserve Board to acquire the company. Michigan National's two defensive steps looked like this: • The new rights attached to Michigan National stock. Under the plan, the company said Michigan National shareholders are in effect guaranteed $45 per share from the acquiring company. For instance, if a buyer pays $35 per share for Michigan National stock, shareholders could buy $45 worth of the buyer's stock for $35. • A stock sale. Michigan National issued andsold about 2 million new shares, equal to 14.9 percent of the company's common stock, to Marine Midland Bank, based in Buffalo, and Mich-
See BANKS, PAGE 25
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