NEWSPAPER
© Entire contents copyright 1985 by Crain Commun icati ons Inc . All rights reserved .
Price: 50 cents a copy; $20 a year.
Crain~
Special section: Holiday retailing PAGE 15
Croissant shops pop up all over PAGE 4
•
Sheltered market law helps minority firms PAGE 3
WEEK OF DEC. 9 - 15, 1985 VOLUME 1
0
NO. 45
Detroiters aim to control orange juice producer BY CHARLES CHILD CRAIN'S DETROIT BUSINESS
A group of Detroit-area investors is trying to unseat the board of directors of Orange-co Inc., Florida's fourth largest packer of fresh fruit and a frozen concentrate producer. Randon Samelson and George Valassis, prominent area businessmen, lead a group that plans to seek shareholder proxies to install their nominees at Orange-co's annual meeting Jan. 16. Gerald Van Wyke, president and spokesperson for the Detroit area group, Summit Resources Inc., declined to say
whether his company planned to make a tender offer for Orange-co. Orange-co, listed on the New York Stock Exchange, had sales of $63.6 million and net income of$2.7 million in fiscal 1985. The company produces about 5 percent of Florida's frozen orange-juice concentrate and fresh citrus fruits, according to Value Line Investment Survey, a weekly investment publication based in New York City. Last Tuesday, Summit Resources obtained a list of Orange-co's shareholders, Van Wyke said. That paves the way for the Detroit group to solicit votes. Orange-co has been considered a takeover target by some
Hall weighs offers on his S&L stock
Area hand tool retailers claim imports are hot BY KATHY JACKSON CRAIN'S DETROIT BUSINESS
Local retailers of hand tools say they are building lucrative businesses by catering to the American toss-away society. The real growth in hand tool sales, they say, is for the occasional do-it-yourselfer who prefers to buy imported, inferior tools and discard them when they break. "Most of my customers would rather pay 99 cents for a hammer from Taiwan than $5.99 for an American hammer," said Morris Bensman, president of Royal Oak-based Crazy Benzy Inc. "If it breaks, they say they'll just come back and buy another one. How many times can a hammer break?" Bensman has opened three of his four Crazy Benzy's stores in the past year growth he attr ibutes to selling tools made largely in Taiwan for prices dr amatically below better-quality American goods. The company, which employs 15 people and posted sales of $2 million in fiscal 1985, is looking for a 10,000-square-foot warehouse, and is planning to open a store in Pontiac next spring. Mich a el Travis, presiden t of WarrenSee TOOL, PAGE 30
~
Wall Street analysts who believe its stock is undervalued, said David Leibowitz, senior vice president of American Securities Corp., an investment banking firm based in New York City. But Leibowitz said the company's stock, which closed in trading Friday at 8 1/2, is probably not as undervalued as many analysts believe. A bid this fall by a group of Orangeco officers to take the company private at $11 per share fell through for lack of financing. Leibowitz said that if the shares had been worth $11, finSee JUICE, PAGE 29 ~
BY CHARLES CHILD CRAIN'S DETROIT BUSINESS
GLENN TRIEST
Morris Bensman of Crazy Benzy Inc. says many customers prefer a 99-cent Taiwan hammer to a $5.99 American one.
Craig Hall, the Dallas financier and real estate investor, said he is considering four offers to buy his pool of First Federal of Michigan stock. The sale would presumably end his threatened takeover of the state's largest savings and loan association . If he decides to sell, he would also earn a substantial gain - an estimated $8.1 million before taxes. After purchasing a major block of stock last year, Hall strongly criticized and sued management, engineer ed t he seating of his father, Herbert Hall, on the board, and threatened to acquire cont rolling interest of the S&L's stock. Jerome Schostak, a major real estate developer in the Detroit
Drop in members weakens supermarket pension fund BY AMY BODWIN CRAIN'S DETROIT BUSINESS
From bombs to boffo, films were produced this year to promote the Detroit area as a swell place to do business . Crain's Detroit Business asked a critic to go to the movies. He found a few stars, such as Detroit Edison Chairman Walter McCarthy Jr. (pictured on the TV screen), and a lot of duds. See Page 26 ~
A pension fund representing about 15,700 unionized supermarket workers in Michigan will have difficulties paying benefits if its membership continues to decline as it has over the past five years, experts say. Some observers of the Detroit area grocery industry predict that membership in the Michigan United Food and Commercial Workers, Unions and Food Employers Joint Pension Plan will continue to drop as supermarkets become non unionized.
.....--- - - 1
See HALL, PAGE 29
~
SUPERMARKET PENSION ___-----. MEMBERSHIP DECLINES
Active participants in the Michigan United Food and Commercial Workers Unions and Food Employers Joint Pension Fund .
They add that problems with t he fund make it difficult to find buyers and sellers of supermarkets in the area. If membership continues to drop, the $208 million fund will have to be shored up with higher contributions or a reduction in benefits to insure future funding, said Joseph Hodovick, actuary for the Detroit office of The Wyatt Co. The Wyatt Co. was actuary of the fund from its inception 20 years ago until November. "It could tolerate for the next 10 years another 20 percent to 25 percent decline," See PENSION, PAGE 29
area, made one of the offers, Hall said. Hall said he has not decided whether to sell the stock in First Federal, which has assets of $9 .7 billion. He owns 9.9 perHall cent of the S&L's st ock - 1. 0 8 million shares, worth $17.6 million at the start of trading on Friday. When Sc h ostak w a s asked whether he had approached Hall to buy t he stock, Schostak said, "I don't k now what you'r e t alking about." He gave t he same reply when asked whether he had talked
~
25,0 0 0 1 - - - - - - - - - - - - - - - - - 1 20,500 20,500 20,000 17,100 16,800 17,700 15,700 15,000 10,000 5,000
1980
1981
1982
1983
1984
1985
Source" The Wyatt Co Numbers are rounded 0« DeclIne In acllVe panlClpants since 1980 has been 23 4 percent based on rounded-off numbers SANDRA SCHULTZ