Kalsec earns B Corp status
New Priority Health leader on accelerating change in health care
PAGE 7
PAGE 22
JANUARY 4, 2021 • VOL. 33/NO. 6 • $3.00
LET THE GAMES BEGIN Regulators, platforms, consumers gear up as online gaming prepares to launch
SERVING WESTERN MICHIGAN BUSINESS SINCE 1988
www.mibiz.com
Thelen to lead The Right Place amid economic development ‘inflection point’
By JAYSON BUSSA | MiBiz jbussa@mibiz.com
S
ports bettors and online casino gamers found themselves sitting on the sidelines in Michigan for all of 2020, even when there was a glimmer of hope that the state would launch online gaming before the year was out. However, people seeking to place wagers from computers and mobile devices can likely do so in the coming weeks. “We’re ready when the industry is ready,” Michigan Gaming Control Board (MGCB) Executive Director Rick Kalm told MiBiz. That’s where this high-profile issue stands at the start of 2021, weeks after state officials waived a 15-day review period on sports betting rules and then issued provisional licenses for 15 different platform providers just eight days later. The actions paved the way for online gambling to go live. The MGCB is now awaiting each platform — including popular sites like DraftKings and FanDuel Sportsbook — to undergo independent testing to ensure the integrity of their games. This extensive vetting ensures that platforms are using geolocation properly and are able to properly identify a bettor so that bets are not placed by someone who is underage or not located in the state of Michigan.
By ANDY BALASKOVITZ | MiBiz abalaskovitz@mibiz.com
hold promise for the city’s transformation. The projects also involve a variety of local interests and investors, including regional developers, the local American Indian tribe and a nearby community college. “There are a lot of pieces when you’re transforming a downtown,” said Scott Ward, president of West Shore Community College, based about 20 miles south in Scottville. The college and community groups have been instrumental
GRAND RAPIDS — Randy Thelen describes the COVID-19 pandemic as an “inflection point” that can shift the course of economic development in West Michigan. Thelen, who was selected last month as the new president and CEO of The Right Place Inc., says the challenges of 2020 will likely create more competition among cities, and generate opportunity for a wider umbrella that includes equity as a key priority in economic development. “Every region in the world is wrestling with what’s next,” said Thelen, who’s planning his move back to Michigan from Denver, where he’s currently senior vice president of Downtown Denver Partnership Inc., the city’s Thelen economic development agency. “The markets that can come together and move forward together are going to be winning markets and be able to leapfrog some of the competition.” During previous recessions, Thelen said Denver “doubled down, invested in itself,” which allowed it to “accelerate out of recession and bypass that competition.” He’s leaving a “hyper growth market” in the Mile High City that’s attracted investments particularly from large tech firms such as Google, Twitter and Facebook. “Virtually any tech company you can imagine has put up a sizable outpost in Denver,” Thelen said. “It’s a healthy reminder that the product of a region matters, and talent and placemaking drives business decisions. There’s been a lot of good movement in that area in West Michigan in the last 10-15 years. We’ve got to continue that.”
See MANISTEE on page 9
See THELEN on page 12
See ONLINE GAMING on page 3
Putting pieces together in Manistee Two hotels, downtown education center lock in community investments in anticipation of post-pandemic recovery, local officials say By KATE CARLSON | MiBiz kcarlson@mibiz.com
A vision for the Spirit of the Woods Manistee Gateway Project presented to city officials in September. COURTESY RENDERING
INSIDE:
M&A Deals in Review: 2020 SEE PAGE 13
MANISTEE — The lakeshore city of just more than 6,000 people is seeing multiple new downtown developments that local officials and investors say are critical for reinvigorating empty storefronts, diversification and emerging better off after the pandemic. In Manistee, two planned hotels, a larger downtown “gateway,” and a new education center
Telehealth soars during pandemic, sparking new health coverage options PAGES 10-11
P
E
R
I
O
D
I
C
A
L
S
AWARD WINNER SPOTLIGHT
NE W C ONS T R U C T I ON: $10 M I L L I ON T O $2 0 MILLION ABC helps our members develop people, win work and deliver work safely, ethically and profitably for the betterment of the communities in which they work. 2515 ALPINE AVE NW, SUITE C GRAND RAPIDS, MI 49544 ABCWMC.ORG
FIRST COMPANIES, INC.: STUDIO PARK PROJECT LOCATION BUDGET ARCHITECT COMPLETION TEAM
Studio Park Grand Rapids $15,900,000 Integrated Architecture October 2019 Project Manager: Craig Schroeder Superintendent: Keith Miller & Tim DeYoung
First Companies constructed Studio Park’s five-story, mixed-use brick structures and piazza in downtown Grand Rapids, including 20,000 SF of commercial space, 106 apartments, and an outdoor piazza with an underground water detention system. The apartments feature exceptional finishes, outdoor balconies, and floor-toceiling glass walls overlooking the city.
Outfit your team with the essential business-development tool:
Timely, relevant business news. Professionals with sales and businessdevelopment responsibilities rely on timely business news and intelligence to drive revenue, create new relevant opportunities and expand brand presence. With MiBiz subscription packages, you can arm your team with 24/7 digital access to real-time news, exclusive stories, market insights and business intelligence about the companies, policies and strategies that are driving Michigan business.
Contact MiBiz today for more information:
616-608-6170 • subscribe@mibiz.com
2
JANUARY 4, 2021 / MiBiz
GROUP & CORPORATE SUBSCRIPTION PACKAGES Visit www.mibiz.com
ONLINE GAMING Continued from page 1
With a number of states looking to deploy online gambling at the same time — including Iowa and Illinois — Kalm said he wouldn’t be surprised if those testing labs may be experiencing a bottleneck. Another caveat that may be slowing the process: Michigan was the only state to regulate online gambling for both tribal and commercial casinos. This means that Michigan’s tribally owned casinos must be licensed by the MGCB for online gaming when they have otherwise operated independently of the state authority for gaming that takes place on tribal land. The state must wait until platforms for both a tribal and commercial casino are ready before launching in order to give both types of casinos equal opportunity out of the gate. Kalm said he expects sports betting will go live first in the middle of January while online gaming will follow shortly after. While casinos and consumers might characterize it as a slow, painstaking process, Kalm was impressed wih the speed at which the MGCB has moved. “From a state regulatory Kalm perspective, we did this in a lightyear — it was very quick,” Kalm said. “From the time the law was signed in December of 2019, and in light of COVID shutting down the casinos and shutting down our ability to go to the office, we were able to get those rules set in time for this legislature to review it and approve it.”
Ready to regulate With such an overwhelming demographic expected to migrate to online sports betting and gaming, it will somewhat reshape the MGCB as cybersecurity and control becomes a paramount issue.
The MGCB does have some experience reg- place bets from home, the total amounts wagered ulating an online gaming format through the could potentially rank among the top sports gamMichigan Lottery. bling states in the country. “We’re going to adapt,” Kalm said. “We have “There are some people that won’t go to casia division of online gaming already inside the nos and (casinos) never captured that market,” agency which will be ensuring internal controls Kalm said. “A lot of it has to do with the younger and watching the online gaming format. But we demographic, the 25- to 35-year-olds that are still have the retail side — the commercial casino very comfortable using technology.” side — and we have regulators in place there, too. New Jersey, with a similar population to It’s sort of adding another arm to us.” Michigan, in October 2020 saw $803 million For security and control, all servers for these wagered via sports betting, of which 92 percent online platforms must be located within Michigan was done via mobile app. Revenue on sports betand anyone who can change the ting tallied $58.5 million for that outcome or touch the software month. The state has seen more has to be vetted and licensed to than $4 billion placed on sports do so. bets for the entire year. Manipulation of game results “We fully expect Michigan is another critical issue for sports to be successful just given the betting. Platforms will have to pent-up demand from operacontract with third-party data tors and suppliers in the state monitoring companies to look but also the end customer — for suspicious betting activity. the Michigan residents, I think, The stringent control meawill be excited to have some sures were developed after a — RICK KALM really cool products that they year of consulting with industry can play on,” said Max Bichsel, Executive Director of the professionals and other states. vice president of U.S. business Michigan Gaming Control “We collaborated really for Gambling.com Group, Board closely with Indiana and New which does digital marketing Jersey, who are out in front of for the global online gaming (sports betting and online gamindustry. ing) already,” Kalm said. “New Jersey really wrote The company has launched an affiliate webthe book on it — they’ve been doing it several site to cover online gaming in Michigan called years. We’ve done visits to New Jersey and col- GreatLakesStakes.com laborated with their gaming board.” In a report from The Gambling.com Group, the organization predicted that Michigan would skyrocket to No. 3 for online gaming revenue in Sports gambling floodgates 2021, behind Pennsylvania and New Jersey. With some casinos opening in-house retail sports “Look at a nearby state like Illinois, which books this fall, initial numbers reveal strong has only been live with online sports betting demand. In October, Michigan’s three commer- for a little while as Governor (J.B.) Pritzker has cial casinos recorded total wagers of $46 million removed the requirement for on-site registration. and gross receipts of around $7.6 million to the They’re taking almost half a billion dollars in bets casinos. This was also while the casinos were lim- in October,” Bichsel said. “You take that to a state ited with capacity restraints. like Michigan — where it has online casinos and In November, when those casinos spent much online sports with no on-property registration of the month closed completely, they recorded requirement — and I think the numbers will be total wagers of $25 million. When users are able to pretty impressive, pretty quickly.”
BIZ BRIEFS
Here is a recap of recent stories from MiBiz.com.
Steelcase says October cyberattack delayed $60 million in shipments An Oct. 22 cyberattack that stalled Steelcase Inc.’s global operations for two weeks effectively delayed approximately $60 million in shipments into the company’s current quarter. The delay contributed to a 35-percent drop in revenue for the third quarter of the company’s 2021 fiscal year, which ended Nov. 27. (Steelcase’s 2021 fiscal year began Feb. 29, 2020.) Steelcase (NYSE: SCS) said 6 percent of the decline could be attributed to the shipment delays associated with the shutdown related to the cyberattack. Of those delayed shipments, $50 million are scheduled for the Americas and $10 million are for clients in Europe, the Middle East and Africa (EMEA). Steelcase CEO Jim Keane told brokerage analysts in an earnings call that the company estimated it incurred about $6 million in incremental costs Visit www.mibiz.com
in its third quarter because of the “novel day-zero attack orchestrated by very sophisticated actors.” Keane said Steelcase’s I.T. department identified the ransomware attack early enough before it deeply infiltrated the company’s system.
West Michigan Whitecaps promoted to High Single-A affiliate for the Detroit Tigers The West Michigan Whitecaps have moved one spot closer to the Detroit Tigers within a shifting hierarchy of Minor League Baseball. The Tigers announced its new structure of minor league affiliates last month, moving up the Whitecaps as the team’s High Single-A affiliate after spending the previous 27 years as a Low Single-A organization. The Whitecaps, which belong to the Midwest League, swap roles with the Lakeland Flying Tigers of the
“From a state regulatory perspective, we did this in a lightyear — it was very quick.”
Florida State League, which will drop down to Low Single-A status. The Toledo Mud Hens will continue as the team’s Triple A affiliate, just one step down from Major League Baseball. The Erie SeaWolves also remain the organization’s Double-A affiliate. According to Tigers Vice President of Player Development Dave Littlefield, the overall player experience provided by the Whitecaps was a major reason for bumping the team up the food chain.
Huntington, TCF plan $22B merger Columbus, Ohio-based Huntington Bancshares Inc. (Nasdaq: HBAN) and Detroit-based TCF Financial Corp. (Nasdaq: TCF), two of the largest banks operating in West Michigan, plan to merge in a $22 billion deal that would create a Midwestern banking powerhouse. The all-stock transaction, announced in mid December, could close in the second quarter of 2021, pending shareholder and regulatory approvals. The combined bank, with TCF merging into Huntington, would have about $168 billion in assets, $117 billion in loans, and $134 billion in deposits with dual headquarters in Detroit and Columbus.
Operating under the Huntington name, the bank would become a top 10 regional bank in the U.S.
State plans another liquor buyback program Michigan has launched a liquor buyback for bars and restaurants for the second time during the COVID-19 pandemic. The move mirrors an effort launched by the Michigan Liquor Control Commission in early 2020 during a prior closure of bars and restaurants to in-person dining. During the first program, MLCC bought back $3.4 million in spirits from 673 liquor license holders, for an average of a little more than $5,000 per each licensee that was closed or had limited operations because of state pandemic mitigation measures. Additionally, the Michigan Department of Health and Human Services opened recipients of the SNAP food assistance program to use their benefits to buy meals prepared at restaurants. Restaurants can enroll in the program, which has “the aim of providing diverse and affordable options for eligible participants across the state.” More information on the Restaurant Meal Program is available on the MDHHS website.
Published since 1988 MiBiz® is a registered trademark of MiBiz, Inc.
Publisher Brian Edwards / bedwards@mibiz.com Associate Publisher Denise Montambo / denise@mibiz.com Editor Joe Boomgaard / jboomgaard@mibiz.com Managing Editor Andy Balaskovitz / abalaskovitz@mibiz.com (energy, policy) Senior Editor Jayson Bussa / jbussa@mibiz.com (manufacturing, tech, sports) Senior Writer Mark Sanchez / msanchez@mibiz.com (finance, health care, life sciences) Staff Writer Kate Carlson / kcarlson@mibiz.com (real estate & development, small biz) Contributing Reporter Marla Miller VP of Production & Audience Development Kristi Kortman / kkortman@mibiz.com Digital Specialist Danielle Affholter / daffholter@mibiz.com Graphic Designer Kaylee VanTuinen / kvantuinen@mibiz.com Senior Advertising Consultant Shelly Keel / skeel@mibiz.com Sales & Marketing Associate Lauren Frailey / lfrailey@mibiz.com Circulation For address corrections or subscriptions, contact MiBiz at 1-877-443-1977 or subscribe@mibiz.com
MiBiz ISSN 1085-4916 • USPS 017-099 Established 1988 MiBiz is published every other week by MiBiz, Inc., P.O. Box 1629, Grand Rapids, MI 49501. Telephone (616) 608-6170. Fax (616) 608-6182. E-mail: info@mibiz.com. Subscription changes: subscribe@mibiz. com. Periodicals Postage is paid at Grand Rapids, MI. POSTMASTER: Send address changes to MiBiz, P.O. Box 1629, Grand Rapids, MI 49501. Subscriptions are available without cost to qualified readers. Paid subscriptions are available to those not meeting qualified circulation requirements. Paid subscriptions are $99/year. Single copy and back issues (when available) are $3 each, plus first class postage. Call 1-877-443-1977 to order. MIBIZ INC. 1059 Wealthy St. SE, #202 Grand Rapids, MI 49506 616-608-6170 phone • 616-608-6182 fax COPYRIGHT ©2021. All Rights Reserved.
Reproduction or use of any portion without permission of the publisher is prohibited.
MiBiz / JANUARY 4, 2021
3
MANUFACTURING
‘Manufacturing Millennial’ helps industry appeal to younger workers By JAYSON BUSSA | MiBiz jbussa@mibiz.com
W
hile Jake Hall might not tout the same beastly social media metrics as some famous American socialites, he considers himself a rare influencer in the manufacturing industry. His approach seems to be working, too, and could set a blueprint for an industry that is fac-
“I would say the automation and manufacturing industry is very underrepresented when it comes to video content and sharing it,” said Hall, who curates and creates manufacturing-focused content online as The Manufacturing Millennial. “All these other companies in industries out there, they got their commercials down and their branding down,” he said. “I think more (manufacturers) are realizing that putting together a nine-and-a-half minute video that is pretty much just reading off a data sheet on why their sensor is good doesn’t attract people. You need to share a story and I think that’s what I’ve done with my content.”
A product of survival Hall, 31, went to work for Grand Rapidsbased industry technology and automation specialists Feyen Zylstra LLC in September as a business development Hall Brown Walsh manager. As part of his duties, Hall works with machine builders and end users to help ing a serious shortage of talent and general proimplement Industry 4.0 technologies to create duction workers.
WEST MICHIGAN’S LEADING COMMERCIAL ROOFING CONTRACTOR
more efficient manufacturing processes. Before that, he worked for Industrial Control Service Inc. in Zeeland, which sells automation equipment. In a single work week during a normal year at Industrial Control, Hall would find himself consulting with dozens of manufacturers and their engineers. That in-person interaction stopped when the COVID-19 pandemic crept into the picture. This pushed forward an idea that he had been kicking around for more than a year: To shine a spotlight on an industry that isn’t necessarily known for fast-paced, flashy videos or other content that resonates on social media. “I said, ‘I need to find a way to get content out there and let people know I’m still available,’” Hall said. “I just turned to LinkedIn.” The Manufacturing Millennial’s LinkedIn page is Hall’s content-sharing hub, where he currently has 13,000 followers and 2.4 million views to his content. He also has a standalone website, which he hopes to further build out in the future. Hall shares video content that he finds interesting and timely, even if it highlights a manufacturing process for something mundane. For instance, around Thanksgiving, he shared a video that showcased a high-speed vision inspector for green beans because green bean casserole is his favorite Thanksgiving dish. His aim is to garner attention to all forms of automation and manufacturing. Another example of this is when Hall shared a video that outlined the manufacturing process used to create pencils, which drew more than 50,000 views. “Everyone holds a pencil but they don’t realize how that pencil was made and it’s really cool to highlight these manufacturing processes,” Hall said. “I think it gives people a better understanding.”
Making manufacturing fun
EASTMUSKEGON.COM
4
JANUARY 4, 2021 / MiBiz
Outside of curating content for the general amusement of viewers, Hall said he enjoys highlighting manufacturing specifically in Michigan, a state where most people associate manufacturing with the automotive industry alone. Hall’s approach to promoting machine builders, automaters and their latest innovations stands as a template for getting a new generation excited about manufacturing. Hall pointed to companies like Tesla Inc. and SpaceX as examples of manufacturers that have placed an emphasis on showing the world their innovative manufacturing processes. “Why is Tesla attracting so many of the newest,
youngest and brightest?” Hall said. “Why is Tesla’s median age 25 years younger than Ford’s?” “They made manufacturing fun again,” he said. “You go to work for Tesla because you know you’ll be dipping into the latest and coolest manufacturing processes and what’s new in the industry.” Cindy Brown is on the frontlines of the regional talent pipeline challenge in her role as vice president of talent initiatives for West Michigan economic development organization The Right Place Inc. She is also a member of the executive team for Discover Manufacturing, a regional network of manufacturers. Brown is active in events like Discover Manufacturing Week and MiCareerQuest, which serve as hands-on opportunities for students to get a first-hand look at manufacturing. On the digital front, Brown said manufacturers have been making strides. “I think manufacturers have done a really good job of not just moving to Industry 4.0, but also getting the word out regarding the culture of the organization as well as the equipment they will be using,” she said. “I wouldn’t necessarily say it’s behind the times — I think they’re doing the best they possibly can.” But, she added, “That’s a big task — having someone like Jake out there is fabulous because it’s helping spread the good word.” While a company’s strong roots and tradition in the community might not be flashy, Brown said it does help sway some talent. “For some students, the stability of a company being here for 100 years is important to them so that they don’t get laid off and they don’t lose their jobs,” she said. “I think that’s partly in the back of their heads — they find it important. But I also know that they want to know what they’ll be doing.” Still, it is important for manufacturers to start engaging with students at a young age — a demographic that is very much plugged into social media. John Walsh, president and CEO of the Michigan Manufacturers Association, has done plenty of hand wringing over the growing talent shortage. He emphasized the importance of reaching workers years before they enter the field. “There are some stats that show if you can capture a child in middle school and spark their creativity in manufacturing, that’s when you can really root an interest in the career,” Walsh said. “I think we’re doing pretty good on at least generating interest but we still have a lot of work to do as an industry and as a state to change the overall perception on a career in manufacturing.” Visit www.mibiz.com
FINANCE
Century Technology Group leans on tech acquisitions to drive growth By MARK SANCHEZ | MiBiz msanchez@mibiz.com ADA — Century Technology Group LLC looks to reload by pursuing acquisitions of technology companies that it can grow. The Ada-based company — a family office for Grand Rapids businessman and entrepreneur Keith Harrold — made two acquisitions in 2020 and is “getting close” on two more, one of which is under a letter of intent, President Dana Jacks said. The company wants to acquire companies that are technology focused or “can be bent toward technology or utilize some type of technology in their go-to market,” Jacks said. Acquisition targets as well would “have a strong, hungry management team” that could “use some rounding out or could use some help in certain areas,” she said. “What we’re looking for is something that has good bones and potential. They have a Jacks value proposition that makes sense and that can evolve and grow if it were accelerated with some capital, and has a good management team and they want to build something,” she said. “We really want to grow stuff.” Century Technology Group’s return to acquisition mode comes more than two years after the divestiture of its last prior portfolio company, Data Strategy LLC, to Miami-based private equity firm H.I.G. Capital in August 2018. Data Strategy — originally founded by Harrold, Century Technology Group’s CEO — at the time had sales of more than $400 million, Jacks said. The investment firm is now using the liquidity from the Data
GET THE LATEST E-NEWS SENT TO YOUR INBOX MiBiz publishes free e-newsletters highlighting local news and data, as well as best practices, events and resources: n MiBiz Morning Edition – A daily weekday roundup of business news and intelligence. n NEW! Real Estate/Development Report – A weekly wrap up of the region’s commercial real estate, development and economic development activity. n Small Biz – A bi-weekly compendium of news, best practices and events. n Manufacturing Report – A bi-weekly digest of local manufacturing news. n West Michigan Nonprofits Report – A monthly roundup of news and information affecting the nonprofit sector.
Sign up today at mibiz.com/subscribe/e-newsletters
Visit www.mibiz.com
“The second time around as we go through this is not about us being operators anymore — it’s about lifting and elevating management teams of the companies that are in our portfolio.”
Strategy deal to pursue acquisitions of Jacks cites Inno-Versity, acquired tech companies, Jacks said. in August 2019, as a “great example” of Century Technology Group has been Century Technology Group’s interest looking at companies that typically have in companies that “can be bent toward annual sales ranging from $3 million to technology.” Inno-Versity’s custom $5 million, and will make investments learning programs for higher educain the Midwest with a preference toward tion and Fortune 500 companies have West Michigan-based companies. been adaptable to technology for remote “Right now our focus is mostly West learning. Michigan. That’s where our roots are,” “We’re introducing concepts such Jacks said. “As we reload we’re going to as ARVR (augmented reality and virstay a little closer to home and build out tual reality) and gamification into what from there. We understand the people, they’re doing, or helping them with we understand the clients, and it’s our the delivery of some of these customhome. And the second time around as — DANA JACKS learning programs,” Jacks said. “It’s we go through this is not about us being really been fun to not only watch how President of Century Technology Group LLC operators anymore — it’s about lifting they’ve been able to evolve, but how and elevating management teams of the they’re servicing their clients and the companies that are in our portfolio.” rejuvenated energy in the company. Century Technology Group presently holds two portfolio comThe sales team has more to sell and there’s a lot more thought panies: Inno-Versity, an Ada-based company that provides cusleadership coming from the creative side because they have tomized instruction and training to clients; and Mutually Human more options to offer.” LLC, a custom software and applications developer in Grand The technology sector that Century Technology Group operRapids that it acquired in November. ates in ranked as one of the top areas for activity in 2021 in law At the time of the deal, Century Technology Group Executive firm Dykema’s annual M&A survey. Vice President Jason Kuipers said Mutually Human “fits perTechnology ranked among the sectors where corporate execufectly with our vision of growing a leading software development tives and M&A professionals expect the most activity this year, and application modernization services business and adds to behind health care and automotive and ahead of consumer prodour charter of investing in growth-oriented technology services ucts and financial services, according to the annual survey released businesses.” in November.
THE TRANSFORMATION BEGINS HERE
PROFESSIONAL MBA • Earn your MBA in 22 months while working • Receive a personalized leadership plan • Engage with a hands-on capstone consulting project • Tap into valuable community and business connections www.gvsu.edu/seidmangrad
COLLEGE OF BUSINESS
MiBiz / JANUARY 4, 2021
5
FOOD BIZ
As craft beverage waits out the pandemic, lingering supply chain and policy concerns remain By JAYSON BUSSA | MiBiz jbussa@mibiz.com
T
Uncertainty ahead
The fate of many craft breweries he COVID-19 pandemic hinges on where the pandemic goes has not doused Justin in the coming year. The trade group Buiter’s optimism in his Brewers Association administered a future plans for his brewsurvey to its members that showed ery. However, when Buiter more than 80 percent were very conlooks ahead, he said 2021 will likely be fident their doors would still be open spent regaining the footing his comcome 2021. But when asked if they pany lost during a gauntlet of a year. would still be in business a year from “I think it will be a year of recovery now, that confidence dropped to and getting back on our feet and figuraround 54 percent. ing out what a new normal looks like,” To further underscore the uncersaid Buiter, who is co-owner of Duttontainty, one in five craft brewery owners based Railtown Brewing Co. The brewdoesn’t think they’ll still be operating ery has been open for six years but has by the end of 2021. only operated for two as a full-scale resBuiter called himself cautiously taurant at its location at 3595 68th St SE. optimistic when it comes to the future “From there, we can start lookand said he is comfortable with his ing at 2022 and deciding on some big company’s capital. events we want to move forward with “We’re confident we’ll get (back to and if we want to start dipping our toes normal) by the spring,” Buiter said. in more distribution. I think it will be a “And honestly we feel like there is a year of seeing how things pan out and lot of opportunity sitting out there. letting the dust settle.” There is going to be consolidation in Railtown, and craft a lot of industries and beer producers around I think folks that are FOOD BIZ the state, have certainly able to see their way earned a breather as through this crisis are NEWS — they continue to slog probably going to do Sponsored by: through the pandemic well for themselves. I DAN VOS and its various phases think consumers are CONSTRUCTION COMPANY of shutdowns for bars going to be very eager and restaurants. to get out and spend Unsurprisingly, the and get back to life as pandemic is top of mind for Michigan normal.” brewery owners, who move their Buiter maintains his optimism roughly billion dollar industry into even when his brewery — which the new year. But brewery owners mostly sells its beer in-house — is one face the added stress of supply chain of the most vulnerable. issues and shortages, and late last year While manufacturing breweries — dealt with uncertainty over potentially like longtime West Michigan heavyhigher tax bills and limited financial weight Founders Brewing Co. — are relief from the state and Congress. able to continue generating revenue
Railtown Brewing Co. co-owner Justin Buiter says 2021 “will be a year of seeing how things pan out and letting the dust settle.” COURTESY PHOTO through extensive distribution, breweries like Railtown are put at a near standstill when in-house dining is restricted, which totaled nearly 180 days in 2020. “Put them in the bucket with restaurants and bars,” Founders cofounder and CEO Mike Stevens said of retail-oriented breweries. “The bottom line is you don’t create a retail establishment to operate either closed or at 50 percent capacity. … I feel for these brewers that have just been hanging on since last March, coming up to a year almost. It’s been brutal.”
Supply chain woes While Stevens might not envy the struggles of non-distributing breweries, and faces similar challenges with taprooms in Detroit and Grand Rapids, he must contend with various supply chain woes that grew during the pandemic. For starters, an aluminum can shortage is starting to tighten around the necks of many breweries with significant distribution. Last month, Founders COO Brad Stevenson acknowledged the shortage, telling MiBiz that the brewery has not been able to procure the amount of cans it needs. This problem could potentially
carry over into other essentials of the business, from CO2 to cardboard packaging. Stevens attributed shortages to a combination of increased demand and manufacturers that were hampered by the inefficiencies of COVID and therefore couldn’t always operate at full capacity. While certainly a disruption, these supply chain problems should dissipate fairly quickly as COVID subsides. “The (aluminum) can situation is just a constraint based on the manufacturer being a little caught off guard,” Stevens said. “What happened when COVID hit was all those drinkers — say 30 percent of the U.S. population — used to go to bars and drink draft beer. Well that dried up and shifted liquid into the grocery store channels and pushed a lot more demand in cans.” “The manufacturers weren’t expecting that 30 percent of the American public would all of a sudden want to buy cans,” he added.
11th-hour tax relief When speaking with MiBiz before Christmas, Short’s Brewing Co. CEO Scott Newman-Bale was somewhat anxiously monitoring the progress of two important tax issues that would
save craft beverage producers from a mammoth and unexpected tax bill. Cideries, meaderies, wineries, breweries and distilleries nationwide were lobbying for Congress to pass the Craft Beverage Modernization and Tax Reform Act (CBMTRA), which would make the currently reduced federal excise tax rate permanent. These slashed rates were adopted on a two-year basis in 2017, renewed for a year in 2019, and set to expire at the end of 2020. Congress passed CBMTRA with its omnibus spending and COVID-19 relief package before President Donald Trump threatened to veto the bill. “I wasn’t deathly concerned but it was one of those things with legislation that when you start to change things it can quickly derail,” Newman-Bale said of the last-minute tax changes. “I was worried maybe they would have to procedurally reintroduce and change the bill and whenever you do that, there is always the chance something may change. I was concerned but still relatively confident.” The other important issue was allowing Paycheck Protection Program loan recipients to deduct payroll costs and other expenses covered by the loan. This tax benefit — worth hundreds of billions of dollars for business owners of all industries — was also signed into law.
Design Build General Contracting Construction Management
Warner Norcross & Judd Grand Rapids, MI
6
JANUARY 4, 2021 / MiBiz
www.danvosconstruction.com
Visit www.mibiz.com
Kalsec earns B Corp status By JAYSON BUSSA | MiBiz jbussa@mibiz.com
D
r. Scott Nykaza always considered his company to be both environmentally and socially responsible through its 60-year history. Now it has a credible stamp of approval to back up those claims. Kalamazoo-based Kalsec Inc. — a global producer of natural spices, advanced hop products and herb flavor extracts, colors and antioxidants — recently announced that it has acquired B Corp (benefit corporation) certification. It joins more than 3,500 businesses from various industries across the globe that have worked through a rigorous third party audit to verify that it meets certain standards when it comes to social and environmental performance, public transparency and legal accountability. Some of the more recognizable national names in the program include Ben and Jerry’s Ice Cream, New Belgium Brewing Co. and Patagonia Inc. For Nykaza, CEO of Kalsec, having the third party verification was crucial in proving the company’s commitment to environmental and social responsibility. The verification comes from Pennsylvaniabased nonprofit B Lab, which conducts the audits and maintains the B Corp program. “When we went through the audit, which is a pretty severe audit centered on the practices you have, how you treat your employees, how you think about the environment and all the other things, we found that we had a really strong alignment,” Nykaza said. “We got a passing score with our first audit. It was not the highest one possible, so it really showed us that there were things to continue (working on) to be a certified B Corp.”
Kalsec Inc.’s campus in Kalamazoo. COURTESY PHOTO “Does our office in Shanghai, China have the same sort of values and visions that we do and are people practicing that?” Nykaza said. “We had to do a little more in terms of communication and stewardship of our programs and our responsibilities across the globe.” Despite having labs filled with 65 professionals who combine to speak 14 different languages, Nykaza said diversity was still a point of emphasis and an area for potential improvement at Kalsec, primarily with minorities who have been underrepresented in the company’s candidate pool in the past.
‘Money where your mouth is’ Grand Rapids-based Swift Printing and Communications Inc. is one of only two commercial print shops in the world to hold B Corp certification. Located at 404 Bridge St. NW since 1954, the 11-employee print shop received the certification in 2017 and is in the process of filing for recertification.
“I’m kind of a skeptic when people say, ‘Our business does this.’ It’s like a red flag to me at times because there is so much green washing,” said Swift Vice President Jessica Slaydon. “It’s an easy way to market yourself. Being able to actually put your money where your mouth is, that is what attracted me to (B Corp).” During its certification process, Swift not only audited its own practices but surveyed vendors to ensure that they also maintained certain standards. Slaydon said her company’s B Corp status, paired with the fact that it is locally owned and operated, is a selling point for the company but not the sole motivation behind participating in the program. “It’s about the mission,” she said. “If you’re going to do it, it has to be about the mission. If you’re using it for a marketing tactic, I don’t necessarily think it’s the way to go. But if you fully believe it, I think sales will come from it as a byproduct.” Custom software developer Atomic Object
LLC, with offices in Grand Rapids, Ann Arbor and Chicago, is another West Michigan company with B Corp certification, weighing in with a strong score of 110.4. Like Swift, it also received B Corp certification in 2017 and is working on the recertification process, which has been delayed because of the pandemic. Atomic Object Vice President Mary O’Neill said the company continually strives to be a better business and neighbor to the community, and that it changed nothing about its practices since first applying for B Corp certification. “It was an opportunity to take what we believed to be really strong practices and approaches to business and have them thoroughly reviewed by a third-party, super rigorous process,” O’Neill said. “It wasn’t ourselves saying, ‘Hey, we’re cool. We do all sorts of great things.’ It was going and investing the time and money to have someone else render an opinion for us and we were surprised and delighted at how well we did the first time through.”
A work in progress Kalsec, which started the process in early 2020 before the COVID-19 pandemic took full effect, rang in with a score of 82.5 in a system that factors in five areas of business: governance, workers, community, environment, and customers. Companies need a score of 80 or better to receive certification. By B Lab’s measure, a typical business scores roughly 50.9. Achieving B Corp status by no means indicates “mission accomplished” for Kalsec, as the program is an ongoing one. B Corp certification is granted on a three-year basis and companies must show that they are improving to maintain certification. Nykaza said that’s one of the features that will ultimately benefit Kalsec. “We get the benefit of people that study this every day and they tell you about things you can do that maybe have a bigger impact,” he said. “They spend a lot of time thinking about energy utilization and how you serve minorities and all the other things that really reaffirm what we want to do.” As a 442-employee company that operates on a global scale, Nykaza said that Kalsec had to ensure that every corner of the business was on the same page. Visit www.mibiz.com
The <engine/> team would like to thank our clients for their support in 2020. HERE'S TO 2021!
<engine/> | Grand Rapids, MI | runengine.com MiBiz / JANUARY 4, 2021
7
SMALL BIZ: COPING WITH COVID-19
Walker-based medical workstation manufacturer ramps up product development By JAYSON BUSSA | MiBiz jbussa@mibiz.com
T
he COVID-19 pandemic was a driving force that influenced product development and launches for Altus Industries Inc. in 2020. The Walker-based company — which specializes in designing and building workstations for the medical industry — found itself fast-tracking existing projects and developing some from scratch to feed the under supplied
Workers at Altus Industries’ facility in Walker and a model of the company’s L3 ClioAir LCD cart (below). COURTESY PHOTOS medical industry, which was facing both a surge and shift in demand. During the pandemic, Altus Industries sped up the development of lighter-weight carts to support ventilators, virtual patient visits and telehealth.
Visit sbam.org/join and use promo code JAN21 at checkout to save 21% on a new membership.
8
JANUARY 4, 2021 / MiBiz
While Altus had been slowly developing its telehealth and lightweight powered cart — the L3 ClioAir LCD cart — both the virtual visitor and ventilator carts were in direct response to the shifting needs of medical facilities. The company employs 36 and is headquartered at 3731 Northridge Drive NW in Walker. “It was all in our wheelhouse — these are all similar things to what we make,” said Sarah Leitz, Altus Industries’ director of product marketing. “Luckily what we already made was really needed for helping people with COVID. Just with the regular products we had, we shipped hundreds if not thousands off to hospitals that were dealing with surges and (the new products) were additional things we could do to help.” The virtual visitor cart, which was made as part of a partnership with Rockford-based electrical specialists Byrne Inc., provided an easy way for patients to interact with family members and in some cases with nurses in the event they had a brief, simple request. SMALL BIZ Understanding NEWS the importance of — the product, Altus Sponsored by: SMALL BUSINESS pushed a model ASSOCIATION OF out the door immeMICHIGAN diately so hospitals could use them before going back to overhaul the design. In fact, Leitz estimated that the first couple hundred were made and sold at cost. The gravity of what the cart was used for was not lost on Altus. “Of course we’re thinking about business and providing work stations, but this is one of those things where you’re helping people visit their family and maybe their last time they’ll get to say goodbye,” Leitz said. “That’s pretty big.” Altus Industries was fortunate to sidestep the typical supply chain woes that manufacturers in other sectors have faced, making for smooth production on these products. “We were very fortunate that 80 percent of the components are made here in the U.S. — so, no huge problems with the supply chain,” Leitz said. “We were very fortunate to be able to crank them out. Some suppliers in Grand Rapids and
West Michigan stayed open March, April and May just for us.” And while many of the products were designed as a response to COVID, Leitz expects them to stick around and find a purpose in the market after the pandemic subsides. This is especially true for the lightweight L3 ClioAir LCD cart that has made the lives of frontline workers easier. “Nurses are working longer hours, doing more, and we knew this cart could help release some stress on them,” Leitz said. “If you make a lighter cart, they’re pushing around less weight and able to do their job a little bit better. …We wanted to do anything we could do to help out those on the front lines.”
Visit www.mibiz.com
REAL ESTATE & DEVELOPMENT MIBIZ TO LAUNCH DIGITAL REAL ESTATE/ DEVELOPMENT REPORT ON JAN. 6 MiBiz will launch a new weekly e-newsletter devoted to the region’s commercial real estate, development and construction activity. The MiBiz Real Estate/Development Report — a weekly digest of the West Michigan region’s commercial real estate, development and economic development activity — will begin on Jan. 6, 2021.
A rendering of Suburban Inns’ plans for a 108-room Hampton Inn and Suites at 101 South Lakeshore Drive along Manistee’s lakeshore. COURTESY RENDERING
MANISTEE
Continued from page 1 in redeveloping a vacant and deteriorating former retail building for offices and classrooms. “These projects downtown are really moving forward partly because of this cohesiveness from everyone in the city, county, Chamber, college, tribe and private entities working hand in hand to see what we can do,” Ward said.
Suburban Inns’ evolution Marc Miller, economic development director at the Manistee Area Chamber of Commerce, said it’s “spectacular” to have two hotel projects moving forward during the pandemic, which led to mass hospitality layoffs and ongoing, historically low occupancy rates. Hudsonville-based Suburban Inns plans to manage a 108-room Hampton Inn and Suites at 101 South Lakeshore Drive. The proposed Hiltonbranded, five-story hotel is expected to be completed in April 2022 and would replace the twostory Lakeshore Motel now at the property along Lake Michigan. “There’s not another Hilton (hotel) property for 90 miles, and we saw this as an opportunity to develop a property on a very unique location with a very sought-after brand and loyalty program that Hilton has,” Suburban Inns CEO Peter Beukema told MiBiz. The hotel will be owned by Hotel Ventures Manistee LLC, a separate company registered to Beukema that’s a common ownership structure for Suburban Inns. The new hotel is part of Suburban Inns’ evolution during 2020 to diversify its properties and services in the hospitality industry, Beukema said. Suburban Inns’ portfolio includes eight hotels in Midland, Grand Rapids, Holland and Grandville. Since the pandemic hit, the company is increasingly partnering with investors, including on the renovation of the McCamly Plaza Hotel in downtown Battle Creek that’s expected to be completed in 2022. “We look at these projects as an opportunity to grow and take advantage of opportunities Visit www.mibiz.com
“This project will bring the community together, including a group that isn’t always involved in the city, and gives them an opportunity to develop their ancestral homelands.” — TYLER LEPPANEN COO of Little River Holdings LLC
during the pandemic because all these projects are going to take approximately 18 months to open,” he said. “We are taking the opportunity to double down right now, knowing in 18 months we’ll be climbing out of this.”
A more inviting gateway Conceptual plans for the Spirit of the Woods Manistee Gateway Project were presented to the Manistee City Council in September 2020. The project is being developed by Peru, Ill.-based CL Real Estate Development and Little River Holdings LLC, the economic development arm of the Little River Band of Ottawa Indians. The project plans include improvements to the entryway into downtown Manistee, as well as the construction of a 100-room upscale boutique hotel. The vacant businesses in Manistee currently lining US-31 are not inviting to travelers as they pass through town, said Little River Holdings COO Tyler Leppanen. The city also saw a 6 percent population decline from 2000-2010, according to U.S. Census data. “This project will bring the community together, including a group that isn’t always involved in the city, and gives them an opportunity to develop their ancestral homelands,” Leppanen said. The upscale hotel planned at the gateway project could also accommodate Little River Casino Resort visitors at peak times. The casino resort is about six miles northeast of downtown.
“Our market studies show that if guests aren’t able to find hotel rooms at the resort then they are not looking to stay in the Manistee area. They instead look at Traverse City or Petoskey and leave the community for lodging,” Leppanen said. “Bringing in another hotel with visitors circulating through the downtown will generate a lot of spending in the Manistee area and downtown.” Project construction, which has been delayed some by the pandemic, is expected to start sometime in the late summer or fall of 2021. “This is an important project for the community and the tribe,” Leppanen said. “It’s very visible and transformational and we want to make sure we get it right.”
Educational anchor Development projects aside from the hotels are also planned in Manistee, including at a large deteriorating, vacant building downtown that was renovated with a $5 million investment from several community agencies to form the Manistee Downtown Education Center. The space includes offices and meeting rooms that accommodate West Shore Community College, the Manistee Chamber and Michigan Works!. “We were able to move this project forward by all of us working together,” said Ward, of West Shore Community College. “I always try to stress to people how tied the community colleges are to the local economy. A strong community college helps make a strong economy — it’s a symbiotic relationship.” The downtown classroom space could also accommodate a larger number of high school students looking to dual enroll in classes by shortening their commute, Ward said. While the street level of the building is nearly complete, the lower level is awaiting a potential tenant that could occupy the space by mid-2021, Ward said. The building was renovated with $1 million in community donations, $500,000 from the Manistee Downtown Development Authority, and about $3.5 million from West Shore Community College, which Ward said was supported by the college’s board.
The weekly digital newsletter will include MiBiz reporting and aggregated coverage from a variety of local, regional and national publications. Coverage will be led by MiBiz real estate and development reporter Kate Carlson, who can be reached at kcarlson@ mibiz.com for tips. Readers can sign up for the newsletter, which publishes on Wednesdays, at MiBiz.com. — MiBiz staff
“We know the economy is suffering now, so we said let’s not weaken the college at this point and let’s be ready to help our community when the economy can open back up,” he said.
A plan for growth Community leaders say part of the reason why the West Michigan beachtown is seeing economic development interest is a targeted approach to developers that has spanned several years. “Our economic development approach was novel for a community of our size,” said Miller, of the Manistee Chamber. “We have been gathering steam and progress by having that dedicated focus for economic development, and we’re seeing the fruit of that now with these projects.” Miller’s position at the Chamber was created when he was hired about a year and a half ago. The position was the result of the Chamber’s effort to jumpstart the stagnated development that had unfolded over the years. “We were not seeing a cohesive movement for economic development at the time,” said Ward, who also sits on the Chamber’s economic development committee. “Some different entities were organizing and stepping on each other’s toes. The Chamber stepped forward to provide leadership, but they needed funding for the position,” which came from various organizations, the city of Manistee and the county. Looking forward, Miller is planning to work with the Michigan Economic Development Corp. to recertify underutilized sites in the area as “redevelopment ready.” “One of the benefits is it highlights five or six sites, and we’re looking at expanding our list and adding new properties,” Miller said. “We still have opportunities for historic preservation, housing and other opportunities. There is more room for growth in the city.” MiBiz / JANUARY 4, 2021
9
FOCUS: TELEMEDICINE
Telehealth use soars during the pandemic, here to stay By MARK SANCHEZ | MiBiz msanchez@mibiz.com pectrum Health entered 2020 with a goal of having half of eligible primary care patient visits with its doctors occur virtually by the end of 2022. Then came the COVID-19 pandemic that resulted in physician offices in Michigan being closed for three months in the spring, leading medical practices to redirect patients to telehealth platforms to connect with their doctors for low-acuity, routine care. The result was exponential growth in virtual visits in 2020 after years of gradually gaining traction with consumers. At Spectrum Health, virtual primary care visits with doctors via the OnDemand telehealth service hit 35,000 in April 2020. That one-month total exceeded all of 2019.
S
through late December 2020 and 11,000 through its OnDemand Video Visit service. The health system completed just 248 video visits in 2019 and “we anticipate that telehealth volumes will grow and be expanded to support additional services in 2021 as more people and providers become accustomed to using this technology offering greater access to patients,” according to a spokesperson.
Expanding access
While telehealth visits flattened during the summer after physician offices reopened, care providers say they remain well above pre-pandemic levels. Now that telehealth has broken far more into the public consciousness, care providers say it’s here to stay and will only become further embedded in health care as more consumers embrace the convenience the service offers. “We don’t see telehealth going away once COVID is under control,” said Dr. Fred Reyelts, a family practitioner and medical director for innovation at Mercy Health Physician Partners. “We also see this as a long-term piece of our repertoire of how we can take care of patients,” Reyelts said. “It allows us to practice in ways that we didn’t think we could in the past.” Brenner Reyelts Owens Mercy Health began adopting telehealth Dr. Kristopher Brenner, a family physician and in earnest early last year, before the pandemic hit. division chief for virtual medicine at Spectrum In 2019, Mercy Health Physician Partners docHealth, describes the pandemic and 2020 as a year tors completed “virtually zero” telehealth visits, that “shot us out of a cannon” in using telehealth. Reyelts said. That changed with the events of The Grand Rapids health system has since exceeded 2020 and the resulting rapid rise of telehealth. its goal for virtual visits well ahead of schedule. Mercy Health now has a near-term goal of having “We literally are 24 months ahead of where we 10 percent of primary care and some specialty ever dreamt we’d be,” Brenner said. “It’s moving physician visits occur virtually by the end of the faster than we ever anticipated.” first quarter of this year, according to Reyelts. As of late December, Spectrum Health had Having 25 percent to 30 percent of patient recorded nearly 415,000 video visits in 2020, an visits occur virtually within a year “is not unreaexperience that is typical of the massive growth in sonable” for Mercy Health Physician Partners, telehealth that began with the COVID-19 pandemic. said Reyelts, who in the last couple of months Kalamazoo-based Bronson Healthcare has completed half of his patient visits virtually recorded more than 78,000 scheduled video visits after doing none in 2019.
According to industry experts, virtual doctor visits offer greater access to care, especially in rural markets, and are far more convenient for patients than in-person office visits. Care providers say telehealth is becoming commonplace for basic primary care, such as annual health checks or chronic disease management. They believe the platform will evolve to incorporate more care. “I really believe that in the future of health care, your kids and my kids are probably going to be consuming care a little differently,” said Dr. Khan Nedd, CEO of Grand Rapids-based Answer Health LLC, an umbrella administrative organization for 200 independent medical practices with more than 1,000 care providers in the western Lower Peninsula. “That future is coming and we’re getting used to this telemedicine platform, but we can extend it to be much more of a complete, integrated form of how we care for patients.”
Freeing up capacity Advances in medical technology enable doctors to do more virtually than ever before, according to Brenner at Spectrum Health. He cites internetconnected blood pressure cuffs and monitors, and hand-held devices with digital cameras that allow doctors in video visits to listen to patients’ heart and lungs, or to check their ears, nose and throat. “We’re really almost starting to emulate in your home what we would listen to or look at (in the office) using these devices,” Brenner said. Care providers use telehealth for routine primary care and also for consultations with medical specialists. Other uses include ongoing care for patients with chronic medical conditions or for patients after they’ve been discharged from a hospital. In late November, Metro Health-University of Michigan Health launched a home monitoring telehealth service for recovering COVID-19 patients who otherwise met the criteria for discharge but remained hospitalized because they needed ongoing monitoring, said Dr. Lance Owens, the health system’s chief medical information officer.
Connect from home.
Treating anxiety, depression, and more. Teletherapy available for all ages. 200+ licensed, West Michigan clinicians. pinerest.org/telehealth | 866.852.4001 Psychiatric Urgent Care Center: in person and virtual walk-in psychiatry for adults. pinerest.org/urgent | 616.455.9200
10
JANUARY 4, 2021 / MiBiz
Between Nov. 30 and late December, Metro Health had used the Hoboken, N.J.-based Health Recovery Solutions’ home monitoring platform for 29 COVID-19 patients after their discharge. The system uses tablets and internet-connected devices such as blood pressure cuffs, scales and pulse oxygen sensors to check and report a patient’s vital signs. If a patient’s readings are outside of normal parameters, the system alerts a monitoring center that’s staffed by medical professionals who respond accordingly. Through Dec. 23, the HRS system had saved 142 patient days at Metro Health Hospital, freeing up needed bed space as the health system was nearing capacity from the surge in COVID19 patients, Owens said. “We’re happy because we’re able to monitor them and we can open up a bed for someone else who may be sicker or someone who needs a crucial surgery,” Owens said. “Hospitals are bursting at the seams and freeing up one or two beds can make a big difference in the supply chain of hospital beds.” Metro Health was already planning to use the Health Recovery Solutions system prior to the surge in COVID-19 cases this fall. The health system soon hopes to extend the home monitoring platform for patients with congestive heart failure or chronic obstructive pulmonary disease, Owens said.
High scores from patients Mental health care and physical therapy providers also have made greater use of telehealth over the last year. Among the top 10 diagnoses via telehealth for employees at self-funded companies that Grand Rapids-based benefits consultant Advantage Benefits Group Inc. works with, seven were for mental health issues ranging from anxiety and depression to alcohol abuse. Overall, telehealth medical claims for Advantage Benefits Group’s self-funded clients have increased 2,600 percent in 2020 over the prior year, according to company President Bob Hughes. Blue Cross Blue Shield of Michigan saw an “explosion” in behavioral health care through telehealth platforms in 2020, Chief Medical Director James Grant said. Half of Blue Cross Blue Shield members’ telehealth visits during 2020 were for behavioral health, Grant said. Part of the driver in telehealth’s greater use has been consumer and patient satisfaction. In an October report by Troy-based J.D. Powers, telehealth received high satisfaction scores that were “among the highest of all healthcare, insurance and financial services industry studies conducted” by the firm. Barriers to greater consumer adoption and the deployment of telehealth remain, namely through the lack of reliable high-speed internet access in some rural markers where telehealth can help to address provider shortages and improve access to care. The new COVID-19 economic federal stimulus package Congress enacted includes $7 billion for broadband access, $300 million of which will go for rural broadband service and $250 million for telehealth. Visit www.mibiz.com
Insurance reimbursements, new virtual-first coverage plans to help ensure telehealth’s growth By MARK SANCHEZ | MiBiz msanchez@mibiz.com
A
s COVID-19 emerged last spring and closed physician offices for nonessential care — forcing connections with patients via telehealth platforms — health insurers began to pay doctors the same for virtual visits as they do for in-person care. That reimbursement level continued into 2021 for many health insurers. How insurers set future reimbursement levels will make a difference in how telehealth grows and evolves, said Dr. Khan Nedd, CEO of Grand Rapids-based Answer Health LLC, an umbrella organization for 200 physician practices in the western Lower Peninsula with more than 1,000 care providers. If health insurers after the pandemic no longer pay physicians the same for virtual care as office visits, “then essentially what you’re doing is really getting people to go back to what they were doing,” negating the progress of telehealth, Nedd said. That potential requires physician practices to examine where telehealth fits into the business in the future and how they can meet higher patient demands for virtual care, even if the reimbursement rate changes. “A lot of what happens in health care is aligned to who is paying and what’s being paid,” Nedd said. “We have to get payers to really underNedd stand why this is going to become a tool and how payers can work together with physicians to accomplish the very end that we all are trying to get to.” Virtual visits are giving doctors more time with patients, and “probably greater outcomes at less cost,” on top of providing greater efficiency and access to care for patients, Nedd said. Like many organizations, Answer Health experienced rapid telehealth growth in 2020. Early in the pandemic in March, Answer Health brought aboard more than 50 practice sites in two weeks, according to Colby Crittenden, the firm’s manager of business development.
5,000 people enrolled in MyPriority Telehealth PCP, with some switching from other individual health plans Priority Health offers. Priority Health brought the individual virtual-first plan to market after spikes in telehealth claims. In April 2020, one in every five member visits to a doctor was done virtually. That compares to one in 1,000 in April 2019, according to Gritters. Telehealth claims flattened during the summer and fall, yet remained far above pre-pandemic levels at one in every 20 doctor visits by a Priority Health enrollee, Gritters said. Detroit-based Health Alliance Plan also introduced two virtual-first policies in the fall for 2021 coverage. HAP’s Virtual Care Plan for individuals and families now has 1,000 enrollees. A narrow network product called Pivotal for
large employers in Southeast Michigan works with telehealth care providers at parent corporation Henry Ford Health System. Both have zero member cost sharing for virtual visits. HAP includes telehealth coverage across all of its policies and introduced the virtual-first policies to “remove some barriers to people getting access to care,” said Margaret Anderson, HAP’s senior vice president and chief sales and marketing officer. The telehealth plan for small businesses had a high level of quote activity during the recent open enrollment period, indicating that employers at least want to consider virtual-first policies as an option for employees to consider. “There is a bit of a learning curve and maybe a slower adoption rate when you think of employer groups,” Anderson said. “We need to get better at
explaining the value proposition and how it’s a lot better if you have an employee take 15 minutes to do an e-visit than it is for them to take a half day off” to see a doctor. Most employers already include telehealth coverage in their employee health benefits, according to Melissa Sluss, director of employee benefits at Lighthouse Group insurance agency in Grand Rapids. The ability to reduce absenteeism is one way that Lighthouse Group promotes telehealth to employers, Sluss said. Employees who need to see a doctor during the day can do a virtual visit from work, she said. “That’s how we’ve historically been able to get traction with it with our clients: Helping them understand it’s a benefit for their employees and it’s a benefit for the company, too,” Sluss said.
VirtualCare
Virtual-first coverage policies As health systems and physician practices turned to telehealth and consumers embraced the platform, some insurers also introduced new policies that emphasize telehealth as the first option for primary care. Priority Health in October launched MyPriority Telehealth PCP for coverage that started Jan. 1. Enrollees in MyPriority Telehealth PCP are assigned a primary care physician through the national telehealth platform Doctor on Demand and do all visits virtually. The policy provides full coverage for preventative care. “Telehealth is certainly here to stay,” said Curtis Gritters, Priority Health’s director of contracting. “Consumers, providers and insurers are all working together to learn how to deliver care and receive care in safe and comfortable ways during the pandemic, and our telehealth plans were a way that Priority Health responded.” Early data during the recent open enrollment period showed the “market responded well” to the plan’s introduction, he said. More than Visit www.mibiz.com
Care is just a few clicks away. Our team of providers treat a variety of medical conditions virtually.
MercyHealth.com/VirtualCare
MiBiz / JANUARY 4, 2021
11
ENERGY
THELEN
Continued from page 1
Regulators approve 3-year electric commercial fleet program in Consumers Energy case By ANDY BALASKOVITZ | MiBiz abalaskovitz@mibiz.com
A
Michigan Public Service Commission order in a sweeping Consumers Energy rate case last month includes a three-year pilot program to study the roll-out of electrified commercial fleet vehicles. The $12.2 million PowerMIFleet program not only provides rebates for charging infrastructure but also hopes to give the utility a glimpse into the way commercial electric vehicles can provide grid benefits. Depending on how they’re deployed and charged, electric vehicles on a large scale could provide benefits by charging during off-peak hours and potentially serve as a form of battery storage. Experts have said deploying commercial electric vehicles, such as in company fleets and delivery vehicles, could help jumpstart the transition to electrified transportation faster than the passenger vehicle segment. Major automakers have also spent the past year racing to develop some of the first electrified fleet vehicles. “Consumers’ PowerMIFleet program fills a key need in supporting municipal and private fleets who want to transition to electric, including trucks, buses (and) delivery vehicles,” said Charles Griffith, climate and energy program director at the Ann Arbor-based Ecology Center. “By supporting the development of EV charging infrastructure for the emerging electric truck market, Consumers Energy customers
12
JANUARY 4, 2021 / MiBiz
will be able to look forward to cleaner air and more low-carbon transportation options in their communities.” The MPSC order includes a service to help fleet managers transition to electric vehicles as well as rebates for charging equipment. The program includes $7 million for fleet charging station capital and operations and maintenance costs, $1.3 million for “resources to recruit customers and site hosts for the Program, concierge service analyses, as well as educate all customers on the benefits of EVs and managed charging,” and $3.4 million for a system to collect and analyze charging data. Consumers spokesperson Brian Wheeler said the fleet pilot program “will encourage the development of electric vehicle charging stations for Michigan employers that have committed to electrifying their fleets.” The fleet pilot program is modeled off of the utility’s threeyear, $10 million PowerMIDrive pilot program approved a year ago, which includes rebates for various types of residential, commercial and public EV fast-charging stations as well as incentives for customers who charge during off-peak hours.
Michigan distribution generation growing A second coalition of environmental and residential ratepayer advocates that intervened in the MPSC case called the fleet EV pilot program a “bright spot” in
the MPSC’s broader order that will raise rates for electric customers by $100 million (Consumers initially sought a $254 million increase) and formalizes a program for compensating customers who install small-scale, onsite renewable energy projects. Under state law, these programs that set compensation rates for excess customer-generated power sent back to the grid are capped at 1 percent of a utility’s average peak load. The compensation rate — or “outflow” credits — approved in the Consumers case and previously in a separate DTE Energy case is less than the retail price of electricity, which has been the rate used in net metering programs for more than a decade. Critics say the new outflow rate, or the power supply cost less transmission, discounts the value of solar power sent back to the grid typically at peak usage times. “In slashing outflow rates by about half, this ruling will be devastating for residential customers,” said Rob Rafson, founder of Muskegon-based Chart House Energy LLC. “If this doesn’t seem fair, that’s because it isn’t. It makes solar investment less attractive, which will cost a lot of Michigan jobs for solar developers.” Although Consumers has disputed testimony provided by clean energy advocates on the outflow credit, the MPSC order also calls for a third-party study on the costs and benefits of distributed energy resources like rooftop solar, battery storage and electric vehicles.
Rod Williamson, executive director of the Association of Businesses Advocating Tariff Equity (ABATE), told MiBiz recently that the current outflow compensation mechanism “makes sense.” ABATE is a trade group for large energy users that regularly intervenes in MPSC cases. “We’re open to having discussions about what the appropriate compensation is for those types of distributed generation programs, but we think it also requires a discussion around the creation of more granular residential tariff rate structures as well,” he said. Meanwhile, ABATE and clean energy groups are united in expanding or eliminating the cap on customers who can participate in these programs. Consumers voluntarily agreed to lift its cap from 1 percent to 2 percent after meeting the program’s capacity. According to an MPSC staff report last month, participation in these utility programs grew 53 percent in 2019 with the total number of customers exceeding 8,000. Program participation has grown every year since 2006, and the latest report doesn’t account for likely growth in 2020. “This increase in Consumers’ (distributed generation program) cap is just a temporary fix,” the Michigan Energy Innovation Business Council said in response to the Dec. 17 MPSC order. “In 2021, the Michigan Legislature needs to step in to ensure that customers across Michigan are able to generate their own electricity.”
Thelen’s joining The Right Place is a homecoming of sorts. After leading Lakeshore Advantage for almost a decade before leaving in early 2014, Thelen spent nearly four years as senior vice president of economic development at the Greater Omaha Chamber. In the late 1990s and early 2000s, Thelen held economic development positions in Monroe County and with the Michigan Economic Development Corp. While at Lakeshore Advantage, Thelen helped the Holland/Zeeland area lure in major corporate investments even during the depths of the Great Recession, including lithium-ion battery manufacturing plants from LG Chem Michigan and Johnson Controls. Thelen said West Michigan’s culture of public-private partnerships was among his professional interests for returning here. “The ability to come back and apply the trade and craft in a market I consider home is a pretty powerful combination,” he said. He’s bringing his experience from Denver and lessons learned about a market that “gets in a groove and becomes a place everyone wants to move to.” He cited investments over the past 15-20 years in downtown Grand Rapids and more recently in downtown Holland and Muskegon. “All of those things make for a quality place and a quality of life people are attracted to,” Thelen said. Grand Rapids Community College President Bill Pink, who’s on The Right Place board of directors and served on the CEO search committee, said finalists from around the country showed an interest in Grand Rapids, and noted President and CEO Birgit Klohs’ influence in the sector. “Aside from the great work (Randy) did in West Michigan at Lakeshore Advantage, he then got out in Omaha and Denver and did Pink really good work in those markets and economic development organizations,” Pink told MiBiz. But Thelen’s prior West Michigan base can allow him to “hit the ground running a bit better than some others. That’s an added value to this whole deal.”
Equity in economic development Top among Thelen’s priorities after joining The Right Place on March 1 is a focus on diversity, equity and inclusion in economic development. “We’ve had the pandemic and this economic recession, but we’ve also had this nationwide conversation on diversity and equity that is continuing now,” Thelen said. “There has to be greater recognition with all of the economic growth that has occurred that not everyone has participated. We have got to do better and figure out ways to connect more members of the community to job opportunities, career paths and economic prosperity.” Pink said he was “impressed” by Thelen’s raising diversity, equity and inclusion during the interview process. The Right Place helped launch the New Community Transformation Fund LP venture capital fund in 2019, which set a $25 million goal to invest in companies nationwide owned by racial and ethnic minorities. As of early December, the fund reported raising more than $5.5 million. Pink believes the Transformation Fund will ultimately serve as a “blueprint” for other communities seeking to ensure equity in economic development. The fund will hopefully position The Right Place to say: “Here’s what we need to focus on: quality jobs for everyone, entrepreneurship where it makes sense for people, and for companies to be built up,” Pink said. “It will be exciting for anyone coming into that CEO spot and seeing those conversations have happened. Those conversations are important, but let’s talk about what action we take.” Visit www.mibiz.com
2020 DEALS: A YEAR IN REVIEW
A comprehensive list of mergers and acquisitions covered by MiBiz in 2020. JANUARY n Traverse City-based Northern Radio of Michigan Inc. sold off a pair of radio stations in separate transactions, according to a report on InsideRadio. Midwestern Broadcasting Co., also of Traverse City, acquired rock station 97.5 WKLT for $450,000, while Mt. Pleasant-based Central Michigan University purchased 94.3 WFCX for $500,000 to add it to the WCMU Public Radio network, InsideRadio reported. n Las Vegas-based private investment firm Crystal View Capital purchased the 398-unit Stowaway Mini Storage at 9879 Portage Road in Portage, according to a report in Inside Self Storage. Berkadia arranged a 10-year, fixed-rate $2.5 million acquisition loan from CIBC World Markets, according to a statement. n The Association for the Blind and Visually Impaired became an independent subsidiary of Mary Free Bed Rehabilitation Hospital on Jan. 1. The nonprofit merger comes as ABVI Executive Director Richard Stevens retired after 17 years at the organization. ABVI served more than 930 clients in the 12-month period ending on Sept. 30, 2019and evaluated more than 500 patients in outreach screenings. n Niles-based Big Brothers Big Sisters of Lower West Michigan merged with South Bend, Ind.-based Big Brothers Big Sisters of St. Joseph County, effective Jan. 1. The Niles nonprofit served Berrien, Cass and St. Joseph counties in Southwest Michigan. n Grand Rapids-based pallet management firm Kamps Inc. sold a majority interest to Los Angeles, Calif.-based private equity firm Freeman Spogli & Co. Founder and CEO Bernie Kamps continues to lead the company and remains a significant shareholder. Other members of Kamps’ management team also participated in the transaction. Kamps manages more than 100 million pallets annually for more than 1,800 customers. Miller, Johnson, Snell & Cummiskey PLC in Grand Rapids was the legal adviser to Kamps, and Lincoln International was lead financial adviser. Morgan, Lewis and Bockius LLP served as the legal adviser to Freeman Spogli. Debt financing for the acquisition was provided by Oaktree Capital Management L.P., Adams Street Partners LLC and Comerica Inc. Terms of the deal were undisclosed. n Zeigler Automotive Group acquired three luxury dealerships in the northwest suburbs of Chicago from Motor Werks Auto Group: Mercedes-Benz and Sprinter of Hoffman Estates, Infiniti of Hoffman Estates, and Jaguar Land Rover of Schaumburg. Visit www.mibiz.com
Zeigler Automotive expects the new stores to add $350 million in annual revenues. Motor Werks Auto Group retained its stores in Barrington, Ill. The deal, which will add an expected 5,000 new units of sales, was Zeigler’s largest to date, according to the company. Terms of the transaction were not disclosed. n Wyoming, Mich.-based real estate appraisal firm Genzink Appraisal Co. has been acquired by Denver, Colo.-based Integra Realty Resources, a commercial real estate valuation and consulting firm. The company will operate from an office at 1009 44th St. SW in Wyoming, its second in Michigan. In the deal, founder
Jeffrey Genzink became a shareholder in Integra Realty, which also hired all of Genzink Appraisal’s employees. Terms of the deal were not disclosed. n BBC Distributing LLC in Kalamazoo acquired Grand Rapids-based Premier Paper & Supplies, a regional distributor of point of sale products, paper supplies, and other non-durable goods. Premier Paper & Supplies’ owners, Jim and Pat Bonander, sold the company to retire. Grand Rapids-based Small Business Deal Advisors LLC served as M&A adviser to the sellers. Terms of the deal were undisclosed. n Ranir, the oral care division of Perrigo Co. plc,
TRIBES PARTNER IN $17.5 MILLION PURCHASE OF ICONIC MCKAY TOWER IN GRAND RAPIDS
T
ribally owned Gun Lake Investments and Waséyabek Development Co. partnered to jointly acquire McKay Tower in downtown Grand Rapids. The two tribal non-gaming economic McCay Tower. MIBIZ FILE PHOTO development entities purchased the iconic downtown building from Steadfast Property Holdings for $17.5 million in a deal that was completed Jan. 15 and brokered by NAI Wisinski of West Michigan. The 18-story, 154,000-square-foot building at 146 Monroe Center St. NW — located at the corner of Pearl Street in the core downtown business district — houses retail, office space, an event venue and luxury apartments on the upper floors. Waséyabek Development is the non-gaming economic investment entity of the Nottawaseppi Huron Band of Potawatomi Indians, while Grand Rapids-based Gun Lake Investments serves in a similar function for the Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians, or Gun Lake Tribe. The deal marks a “rare co-investment” by the economic development arms of two Native American tribes based in Michigan, officials said at the time of the deal. Waséyabek Development was advised on the transaction by Dickinson Wright PLLC, while Rosette LLP advised Gun Lake Investments. As well, Barnes & Thornburg LLP provided legal counsel to the tribes on the transaction.
purchased the assets of Steripod, a toothbrush accessory brand, from Culver City, Calif.-based Bonfit America Inc. The acquisition includes a portfolio of antibacterial toothbrush protectors, children’s products and tongue cleaners. Terms of the deal were undisclosed. n Kalamazoo-based SalesPage Technologies LLC made its second acquisition in seven months with a deal for SalesStation, a division of Milwaukee, Wis.-based Celera Systems LLC. SalesStation, which serves asset management firms outsourcing data management and sales reporting, will maintain its primary office in Milwaukee. Terms of the deal were undisclosed. n Grand Rapids Cardiology merged with Advanced Cardiac & Vascular Centers for Amputation Prevention PLC, also of Grand Rapids. Led by cardiologist Dr. Ronald VanderLaan, Grand Rapids Cardiology and its staff of 17 now practice under the Advanced Cardiac & Vascular Centers brand name. The cardiology practice continues to operate out of its office on East Beltline Avenue as ACV Grand Rapids Cardiology. Advanced Cardiac & Vascular Centers has 72 physicians and care professionals at two locations in Grand Rapids and one in Lansing. n Chicago-based private equity firm DuneGlass Capital acquired a majority stake in and recapitalized Kentwood-based Grand Health Partners, a bariatric and general surgery practice that provides medical and surgical weight loss. The deal marked DuneGlass’ first investment. n Grand Rapids-based public relations and investor relations firm Lambert & Co. acquired New Yorkbased Casteel Schoenborn Investor Relations & Corporate Communications. The acquisition accelerates Lambert & Co.’s growth strategy and boosts its investor relations and financial services expertise, according to a statement. Lynn Casteel and Jeffrey Schoenborn, principals at Casteel Schoenborn, which is based in the Buffalo suburb of Williamsville, were named managing directors of Lambert & Co. as part of the transaction. Terms of the deal were undisclosed. n Precise CNC Routing Inc., a family-owned and operated manufacturer based in Wyoming, Mich., has been acquired by local investors David and Carey Lefere. Precise CNC Routing employs 16-18 people and generates around $2 million in annual revenue. Terms of the deal were not disclosed. Grand Rapidsbased Calder Capital LLC served as the M&A adviser for former Precise CNC Routing CEO Rick Lemson. See 2020 M&A DEALS ROUNDUP on page 14 MiBiz / JANUARY 4, 2021
13
2020 M&A DEALS ROUNDUP
UFP INDUSTRIES CAPS AN ACTIVE YEAR FOR M&A IN 2020
G
rand Rapids-based wood products company UFP Industries Inc. remained an active serial acquirer in 2020. Combined, the deals UFP Industries (Nasdaq: UFPI) closed in the year were valued in excess of $284 million, according to an MiBiz analysis of the company’s securities filings. The firm reorganized its corporate structure and formally changed its name from Universal Forest Products Inc. on Jan. 2, 2020. UFP Industries’ 2020 dealmaking included: • acquiring the operating assets of Texas-based Quest Design & Fabrication and Quest Architectural Millwork in a deal valued at nearly $21.8 million. Quest designs, fabricates and installs millwork and casegoods for a variety of commercial uses, including builders’ sales centers, design studios, hospitality, corporate offices and health care, according to a statement. • buying the assets of Rancho Cucamonga, Calif.-based T&R Lumber Co. for nearly $19.2 million. The deal included T&R Lumber’s affiliates, Sullivan & Mann and Kelmar Creations. T&R is a manufacturer and distributor of products for the nursery industry, including growing containers, pots, trays, wooden stakes, trellises, tree boxes and other supplies. • acquiring Matthew, N.C.-based Fire Retardant Chemical Technologies LLC for $5.9 million. The company develops fire retardants and water repellents and found a niche in new and cost-efficient technologies for wood preservation. • investing $5.3 million into a 50-50 joint venture to form Milan, Italy-based Enwrap Logistic & Packaging S.r.l. The company provides mixed material industrial packaging and logistics services through eight locations in Italy. • acquiring the assets of Atlantic Prefab Inc., Exterior Designs LLC and Patriot Building Systems LLC, all based in New Hampshire. The trio of companies combine to serve the commercial and multifamily construction markets in the northeastern states. The deal values were not yet disclosed in corporate filings. • acquiring all of the outstanding equity in Bartow, Fla.-based pallet manufacturer PalletOne Inc. for $232 million. The company operates 17 manufacturing facilities throughout the southern and eastern regions of the country and also makes a variety of other specialized industrial packaging solutions, such as bins and crates.
14
JANUARY 4, 2021 / MiBiz
n Grand Rapids-based Auto-Wares Group of Companies, a family-owned aftermarket parts distributor and retailer, signed a definitive agreement to acquire four retail automotive parts stores and their inventories in metro Detroit and Kalamazoo from Kennesaw, Ga.-based Icahn Automotive Group LLC, according to a statement. Auto-Wares rebranded the locations to its Auto Value Parts Stores brand. Icahn Automotive retained all of its Pep Boys-branded locations in Michigan and entered into a supply agreement for Auto-Wares to supply those service centers, according to a statement. Terms of the deal were not disclosed. n Kalkaska-based American Waste signed a definitive agreement to sell its solid and liquid waste businesses in Michigan and Pennsylvania to Toronto-based GFL Environmental Inc., according to a statement. The deal was valued at $380 million, including $360 million in cash, according to SEC filings. Owners Michael Ascione and Edward Ascione joined GFL to manage the American Waste businesses. n Grand Rapids-based Priority Health closed on a deal to acquire Total Health Care Inc., a Detroitbased HMO. Under the deal, the two health plans will operate separately and maintain their brand names. Priority Health continues to serve enrollees statewide, and Total Health Care focuses operations in Detroit and surrounding communities. Terms of the deal were undisclosed, although the Grand Rapids-based Priority Health established a $25 million foundation to support health initiatives in the Detroit area. n Comstock Park-based John Grace Construction LLC acquired Muskegon-based Port City Construction & Development Services LLC. The Muskegon general contractor adopted the shortened name of Port City Construction. John Grace Construction specializes in insurance claim work. Executives say the deal allows the companies to expand their respective client bases and continue to focus on their key service areas. n Hopson Flats GPA LLC, a subsidiary of Montrose, Mich.-based Charger Holdings Inc., purchased the 42-unit mixed-use Hopson Flats apartment building at 212 Grandville Ave. SW in Grand Rapids for $8 million from East Lansing-based Krimson LLC, formerly known as Maplegrove Property Management LLC. The deal also included a small surface parking lot at 207 Grandville Ave. SW, adjacent to Custer Office. Bloomfield Hills-based Income Property Organization was the broker on the deal. An affiliate of Maplegrove Property purchased the building in 2015 for almost $9.4 million, according to city property records.
FEBRUARY n Easy Ice LLC, a Marquette-based commercial ice machine rental and servicing company, has been acquired by private equity firm Freeman Spogli & Co. of Los Angeles, Calif. Co-founders Mark Hangen and John Mahlmeister and the Easy Ice management team continue to operate the company. Terms of the deal were not disclosed. Easy Ice was advised in the deal by Los Angeles-based FocalPoint Securities LLC and Austin, Texas-based law firm Queen, Saenz + Schutz PLLC. Varagon Capital Partners and Madison Capital provided debt financing. Freeman Spogli was advised by Philadelphia, Pa.-based Morgan, Lewis and Bockius LLP. Previously, Easy Ice was a portfolio company of New York-based Saratoga Investment Corp., which invested in the company in 2014 and recapitalized it in 2017. n Lowell-based eMotion Controls Co., an automation controls system integrator and software company, was acquired by Mt. Washington, Ky.-based Material Handling Systems Inc., a provider of automation systems to the material handling industry. As
part of the deal, eMotion Controls became part of the Lifecycle Performance Services unit at Material Handling Systems. Terms of the deal were not disclosed. Material Handling Systems was advised on the deal by PricewaterhouseCoopers and the law firm Kirkland & Ellis LLP. n Grand Haven-based Light Corp. acquired Most Modest, a lifestyle and accessory brand based in Stockton, Calif. The deal added products that will help Light Corp. better compete with the increasingly residential design trends in the contract furniture industry, according to a statement. Light Corp. President Marc Langeland said the acquisition poses “a major growth opportunity” for the company as it looks to break into the residential and direct-to-consumer market. Terms of the deal were not disclosed. n Wayne, Pa.-based private equity firm Guardian Capital Partners partnered with the executive management team at Belding-based Flat River Group LLC to acquire the company. Flat River Group, an e-commerce products distributor, offers product sourcing, inventory management and high volume direct-to-consumer drop-shipping. Flat River Group’s financial adviser was Houston-based Gulfstar Group, while Cleveland-based Jones Day acted as legal adviser. Guardian was advised on the deal by the law firm Morgan, Lewis & Bockius LLP of Philadelphia. CIBC Bank USA provided senior financing in the acquisition, while Centerfield Capital Partners provided additional financing and minority equity. n Atwater Brewery, a Detroit-based brewery with a satellite taproom in Grand Rapids, was acquired by Chicago-based Molson Coors Beverage Co. (NYSE: TAP). As part of the deal, Atwater joined the Tenth and Blake Beer Co. division of Molson Coors, which owns and operates a range of craft breweries across the country. Terms of the deal were not disclosed. Atwater was advised on the deal by Arlington Capital Advisors. n Parchment-based Advia Credit Union picked up nearly 3,500 members in a merger with Saint Clair-based Riverview Community Credit Union. Riverview Community Credit Union has a single office in Saint Clair with 3,479 members and $30.3 million in total assets as of Sept. 30, 2019, according to a quarterly financial report to federal regulators. n Charlotte-based Spartan Motors Inc. (Nasdaq: SPAR) divested its emergency response division to Milwaukee-based REV Group Inc. (NYSE: REVG) in a $55 million cash deal, which was effective Feb. 1. The deal allowed Spartan Motors to refocus its business on e-commerce, electrification and autonomous technologies, according to a statement. Under the transaction, Spartan Emergency Response and its brands Spartan Fire Apparatus and Chassis, Smeal Fire Apparatus, Ladder Tower, and UST became part of REV’s Fire & Emergency segment. REV Group also purchased the rights to the “Spartan” name and logo, which it is licensing back to Spartan Motors for its RV chassis business. Spartan later changed its name to The Shyft Group and moved its headquarters from Charlotte to Novi, Mich. n A division of the Bay Mills Indian Community in the eastern Upper Peninsula acquired Four Season’s Market Inc., a grocery store in Brimley. The tribal council approved Bay Mills Enterprises moving forward with the deal on Jan. 27. The 5,160-squarefoot IGA-affiliated store is directly across the street from the 160-acre Brimley State Park, located along Whitefish Bay on Lake Superior, about 15 miles southwest of Sault Ste. Marie. Bay Mills Indian Community Tribal Chairman Bryan Newland said the acquisition will help the tribe toward its goal of “diversifying our business holdings.” The tribe planned to retain all current employees of the store. Terms of the deal were not disclosed.
n Foxbright LLC, a Grand Rapids software and web services company, was acquired by Hannah Lawrence from owners Catherine Ettinger and Paula Whisman. Founded in 2002, Foxbright primarily works with schools to manage and improve their websites. Calder Capital LLC represented Foxbright in the sale. Terms were undisclosed. n Muskegon-based marketing and branding firm Revel acquired Borns B2B. The deal “augments and enhances” Revel’s capabilities, partner and CEO Jason Piasecki said. Revel serves small and mid-sized manufacturers, primarily in West Michigan. Muskegon-based Left Coast Capital Resources LLC brokered the deal, which was financed by Community Shores Bank, also of Muskegon. Terms of the deal were undisclosed. Borns B2B staff moved into Revel’s offices at Lake View Lofts on Western Avenue in downtown Muskegon. Each company retains its brand, and Borns B2B founder Randy Borns remains in business development and creative roles after the transaction. n Niles-based metal components manufacturer Modineer Co. Inc. broadened its capabilities and entered new end markets by acquiring the familyowned P-K Tool & Manufacturing Co. of Chicago. P-K Tool serves customers in the powersports and automotive industries and offers tool design and build, welding, laser cutting, machining and assembly, according to a statement. The company employs more than 950 people. Terms of the deal, which closed Jan. 31, were not disclosed. Modineer is owned by Chicago-based Westbourne Capital Partners, a private equity firm that works with family offices to invest in private companies; Oklahoma City-based family investment firm Hall Capital, the parent company of automotive supplier The Fred Jones Companies; and an unnamed private investor. n Holland-based Westside Auto Group Inc. acquired All Auto Care, a Grand Rapids-based automotive repair shop. The new ownership updated the renamed All Auto Services facility at Ball Avenue and Leonard Street, as well as purchased new equipment, according to a statement. The transaction was completed in November 2019 and announced in February 2020. Terms of the deal were not disclosed.
MARCH n Allegan-based Perrigo Co. plc (NYSE: PRGO) acquired the oral product line from Stamford, Conn.based High Ridge Brands Inc., which filed for bankruptcy in December 2019. The $113 million cash deal follows a bidding process and auction held Feb. 20 in U.S. Bankruptcy Court in Delaware. The acquisition was completed April 2 after court approval. The acquisition could contribute more than $100 million in net sales to Perrigo in the first full year and builds on the July 2019 acquisition of Grand Rapids-based Ranir Global Holdings LLC for $750 million. n Grand Rapids-based Steelcase Inc. (NYSE: SCS) divested coated steel manufacturer PolyVision Corp. of Atlanta to an affiliate of Industrial Opportunity Partners, an Evanston, Ill.-based private equity firm. The $74 million deal allowed Steelcase to focus on “disciplined portfolio management in pursuit of growth.” Steelcase planned to use $41 million of the proceeds to pay off a note and use the remainder to invest in growth strategies, according to a filing with the Securities and Exchange Commission. PolyVision makes a CeramicSteel product used in chalkboard and whiteboard surfaces and architectural cladding. Steelcase acquired PolyVision in 2001 for approximately $176 million, including $103 million in debt, according to SEC filings at the time. n Howard Miller Clock Co. of Zeeland divested its wood furniture manufacturing division, Alexis Manufacturing Co., to Brooklyn, N.Y.-based Roll & Visit www.mibiz.com
Hill Furniture LLC, according to a statement. Alexis Manufacturing operates a 30,000-square-foot facility in Walker and has manufactured complex wood components and wood seating for 75 years. The company serves the residential and hospitality market and also supplies to other OEMs in the fine furniture industry. Howard Miller Clock owned the company since 1983. Terms of the deal were not disclosed. n Grand Rapids-based Charter Capital Partners was the M&A adviser for Hancock-based Keweenaw Financial Corp., the parent company of Superior National Bank & Trust, in the $42 million acquisition of North Star Financial Holdings Inc., the Bingham Farms-based parent company of Main Street Bank in suburban Detroit. The combined bank will have 11 offices in the Upper Peninsula and Southeast Michigan with more than $800 million in total assets. Grosse Pointe Farms-based Olejniczak Advisors LLC, a financial services industry strategic consultant, and Grand Rapids-based law firm Warner Norcross + Judd LLP also advised Superior National on the deal. n Kalamazoo-based Michigan Mobile Canning LLC was acquired by Manchester, N.H.-based Iron Heart Canning Co., according to a report in industry trade publication Brewbound. Both companies provide mobile beverage canning services for breweries, cideries, wineries, distilleries and other beverage companies. Founded in 2013, Michigan Mobile Canning operated from locations in Kalamazoo and Indianapolis. Terms of the deal were not disclosed. n Industrial scales and weighing systems supplier D.C. Martin & Sons Scales Inc. of Wyoming, Mich. has been acquired by Columbus, Ohio-based MettlerToledo International Inc. (NYSE: MTD). D.C. Martin & Sons Scales operated as a family-owned business since its founding in 1955 and has grown to serve multiple industries including food processing, pharmaceutical, discrete manufacturing, agriculture and distribution. The company employs 19 people locally. Mettler-Toledo is a multinational manufacturer of scales and analytical instruments. Grand Rapids-based M&A firm Calder Capital LLC represented the company in the sale. Terms of the deal were not disclosed. n Holt-based Business Management Resources Inc., a provider of managed accounting services to restaurant chains, was acquired by Cincinnati, Ohiobased accounting and advisory firm Clark, Schaefer, Hackett & Co. Business Management Resources founder James Back and three employees joined Clark, Schaefer, Hackett’s East Lansing office. Terms of the deal were not disclosed. n Dykstra IT LLC, a provider of fully managed information technology services, merged into Quantum Leap Inc., a telecommunications provider. Staff from Dykstra IT moved into Quantum Leap’s facility on 44th Street in Grand Rapids and founder Drew Dykstra became a partner. Quantum Leap often used Dykstra IT when installing phone systems. The merger expanded Quantum Leap’s client base and will help to drive growth. Terms of the deal were undisclosed.
brands in the Lansing and Flint areas, according to a statement. The deal also coincided with the purchase of six repair locations in Indiana. The Boyd Group operates non-franchised collision repair centers under the Gerber Collision & Glass brand, and operates several brands that sell automotive glass. Terms of the deal were not disclosed. n Stevensville-based Boelcke Heating Co. was acquired by employee John Nedoba. The sale allowed former owner Dave Boelcke to retire from the company. Grand Rapids-based Calder Capital LLC served as the M&A adviser to Boelcke in the sale. Terms of the deal were not disclosed.
APRIL n Grand Rapids-based public relations and investor relations firm Lambert & Co. acquired Hollandbased ad agency Fairly Painless Advertising Inc. The deal gave Lambert & Co. added complementary capabilities in creative services and advertising. Fairly Painless continues to maintain its current brand. Founded in 1992, Fairly Painless serves regional and national clients in the automotive and manufacturing, consumer products, education, financial services, nonprofit and retail sectors. The firm employs 12 people. Terms of the deal, which closed in early March, were not disclosed. n Jackson-based Melling Engine Parts acquired Performance Springs UK Ltd. of Blackpool, England. The company was renamed Melling Performance Springs Ltd., and management and sales staff stayed on under the new ownership, according to a statement. Performance Springs is a designer and manufacturer of automotive and industrial springs. Familyowned Melling Engine Parts is a supplier to the original equipment and performance aftermarket segments. Terms of the deal were not disclosed. n Pallet management firm Kamps Inc., based in Grand Rapids, acquired wood products wholesaler D&H Bark Inc. of Manton in Wexford County. D&H Bark has been in operation for more than three decades and specializes in wood products ranging from hardwood, red pine, and cedar barks; animal bedding; colored mulches; and landscape chips. For Kamps, the acquisition will allow the company to capitalize on ongoing growth nationally in its pallet and recycling divisions. The addition allows Kamps to produce bark and mulch at a higher volume, as well as expand its customer base. Terms of the deal were not disclosed.
n Patten Monument Co. in Comstock Park, a cemetery headstone provider, acquired Campbell Murch Memorials Inc. in Mattawan, a 125-year-old manufacturer and engraver of cemetery memorials. Todd Sokolowski owned Campbell Murch Memorials since 1984 and sold the company to retire. He was represented in the deal by Small Business Deal Advisors LLC in Grand Rapids. Terms of the transaction were not disclosed. n New York-based managed technology solutions provider BCM One Group Holdings Inc. acquired nexVortex Inc., a Herndon, Va.-based internet phone service provider with an office in Grand Rapids. BCM One plans to maintain the Grand Rapids office, led by Mike Nowak, according to a statement. Terms of the deal were not disclosed
MAY n Caledonia-based Aspen Surgical Products Inc., a producer of disposable surgical products, acquired Precept Medical Products, an Arden, N.C.-based maker of personal protection equipment in health care. The acquisition adds to Aspen’s product portfolio. Aspen, with facilities in Caledonia and Las Piedras,
Puerto Rico, also received about 200,000 square feet of manufacturing and distribution capacity with Precept’s manufacturing facility in Agua Prieta, Mexico, and distribution warehouses in Douglas, Ariz. and Richmond, Va. Precept designs, manufactures and markets protective medical apparel for infection control. The company’s products include surgical face masks, non-surgical isolation gowns, lab jackets, scrubs, coveralls, patient gowns, lab coats and cold therapy packs. Terms of the deal were undisclosed. Aspen Surgical is a platform company of Boston-based Audax Private Equity. n Lansing-based communications firm 7C Lingo LLC acquired 2b Inclusive LLC, a professional development training firm also based in Lansing. Tedi Parsons, managing partner of 2b Inclusive, planned to stay on with 7C Lingo, where he will serve as the vice president of professional development and training, according to a statement. Parsons also will oversee a new initiative, 7C Pros, aimed at professionals just starting a career in the C-suite. 7C Lingo President and CEO Fathy Shetiah said the deal allows the company to expand its services and client base. Terms of the deal were not disclosed. n Grand Rapids-based Charter Capital Partners served as M&A adviser to Oakdale, Minn.-based Supply Chain Services, a provider of automatic identification and data capture and factory automation, in its sale to Santa Monica, Calif.-based Sole Source Capital LLC. The deal allowed Supply Chain Services founder Chip Emery to retire from the company. Sole See 2020 M&A DEALS ROUNDUP on page 16
has been acquired by
n Ada-based design and development firm 2B Studio Inc. was acquired by Plymouth, Mich.-based Innovation Studios LLC. 2B Studio’s founder Bruce Sienkowski remained as president of the company, which has eight employees. Innovation Studios is led by Herman Grewal, who ventured into the design business after owning and operating restaurant franchises. Sienkowski worked with Grand Rapids-based Small Business Deal Advisors LLC. The Business Law Group served as legal adviser to 2B Studio, while Rhoades McKee PC advised Innovation Studios.
n Construction management firm The Christman Co. of Lansing acquired MEDCO Construction, the construction arm of Dallas-based health system Baylor Scott & White Health. Baylor Scott & White Health operates the largest nonprofit health care system in Texas. MEDCO served as the in-house construction partner for Baylor Scott & White for more than 55 years and built medical centers for the company. Christman Co., which generates more than $1 billion in annual revenues and maintains an office in Grand Rapids, planned to expand its services in Texas and surrounding areas with the acquisition. Terms of the deal were not disclosed.
n Kalamazoo-based National Flavors LLC was acquired by Cleveland-based private equity firm The Riverside Co., according to a statement. National Flavors is a producer of flavors used in beverages, frozen desserts, baked goods, confections and processed fruits. The company became part of the specialty ingredients portfolio for Riverside, which typically invests in lower middle market companies. Terms of the deal were not disclosed.
n Chicago-based Boyd Group Inc. acquired eight collision repair centers in Michigan under the Vision Collision and McFall’s Collision & Frame Service
n Ontario, Calif.-based New-Indy Containerboard LLC, a joint venture between the Kraft Group and Schwarz Partners LP, acquired Shoreline Container
Visit www.mibiz.com
LLC, a Holland-based paper and packaging company. Through the deal, New-Indy added Shoreline Container’s two facilities in Holland that produce corrugated packaging products, and a Zeeland facility that distributes protective and specialty packaging materials. Shoreline’s chief operations officer, Bob Zuker, remains with the company. Ernst & Young Capital Advisors LLC served as the financial adviser to Shoreline Container. Terms of the deal were not disclosed.
served as exclusive financial advisor to Innovative Medical Systems Medical Equipment Distributor and Integrator
MiBiz / JANUARY 4, 2021
15
2020 M&A DEALS ROUNDUP Source focuses on acquiring industrial lower middle market companies in North America. n Full-service machine shop Grand Rapids Electric Motor Service LLC was acquired by individual investor Brent Pelishek, according to a statement. EMS sells and repairs electric motors, gearboxes and pumps. The company provides on-site service for customers who need assistance in the installation, alignment or troubleshooting of electric motors. EMS has six full-time employees and three part-time employees. Grand Rapids-based M&A firm Small Business Deal Advisors LLC represented the company in the sale. Terms of the deal were not disclosed. n Holland-based Collision Consolidation Co. LLC acquired Stonewall Road Automotive Group, a Grand Rapids-based multi-state operator of MAACO automotive repair centers. Stonewall Road Automotive Group operates five locations in metro Detroit, four in Maryland and one in Ohio, according to a statement. The company will continue to operate under the Stonewall Road Automotive Group name. The company employs 120 people. Grand Rapids-based M&A firm Calder Capital LLC represented Stonewall Road Automotive in the sale. Terms of the deal were not disclosed. n Byron Center-based SurfacePrep, a private equity-backed abrasive products distributor, acquired Sacramento, Calif.-based Temple Associates Inc., a distributor of loose abrasives and blast equipment. The deal marks the 10th strategic acquisition for SurfacePrep in the last 18 months, according to a statement. Dallas-based private equity firm CenterOak Partners LLC formed SurfacePrep as a platform company out of its November 2018 acquisition of GNAP LLC. Terms of the Temple Associates deal were not disclosed. n Grand Rapids-based BlueWater Partners LLC served as financial adviser to Monroe, Wis.-based Orchid Monroe LLC in its deal to acquire Carter Motor Co., a Chicago-based designer and manufacturer of electric motors, gear motors, rotary converters and tachometers. Orchid Monroe is a manufacturer of components for electric motors, generators and transformers. Terms of the deal were undisclosed.
JUNE n Family-owned investment firm Coastal Group has acquired Bogalusa, La.-based Veecor Co. Inc., a honeycomb packaging manufacturer, and moved the company’s operations to Holland. Two Veecor employees also moved permanently to the Holland area to remain with the company, while another is working remotely on a contractual basis, according to a spokesperson. The acquisition and launch of Coastal Honeycomb LLC could lead to 12 new jobs in Holland to produce the company’s lightweight packaging materials, according to a statement. Coastal Group’s holdings also include Coastal Automotive, Coastal Container and TKP Investments. With the Veecor deal, the company’s packaging services now span design, testing, corrugated, honeycomb, packaging supplies and foam. Terms of the Veecor deal were not disclosed. n The assets of Lansing-based H2O Hydroponics LLC have been acquired by Denver-based GrowGeneration Corp. (Nasdaq: GRWG), a chain of specialty hydroponic and organic garden centers with 27 locations. GrowGeneration previously acquired the assets of Grand Rapids Hydroponics Inc. in September 2019. The company cited Michigan’s legalization of cannabis for recreational use, including the ability to grow up to 12 plants within a residence, as a driver for its continued push into the market. Terms of the H2O deal were not disclosed.
16
JANUARY 4, 2021 / MiBiz
NEOGEN COMPLETES 6 INTERNATIONAL ACQUISITIONS, 1 BOLT-ON DEAL
L
ansing-based Neogen Corp. bolstered its international business with a series of deals through the first half of 2020. With the recent global acquisitions, the food and animal safety products manufacturer now operates from nine domestic and 15 international company-owned locations, clustered in Europe, Latin America, South America, Australia, China, India, Australia and Canada. According to an analysis by MiBiz of securities filings by Neogen (Nasdaq: NEOG), the company invested nearly $16.8 million over seven deals, six of which were international. The deals included: • acquiring Argentina-based Productos Quimicos Magiar S.A., a longtime distributor in South America. Neogen paid $3.8 million for the firm’s Argentina business and $1.5 million for the business in Uruguay, effectively taking over the distribution of its products in the two countries • buying Milan, Italy-based Diessechem S.r.l., a distributor of food and feed safety diagnostic products, for $3.5 million. • purchasing U.K.-based Abtek Biologicals Ltd., a developer and supplier of culture media supplements and microbiology technologies, for $1.4 million to accelerate growth in Neogen’s global microbiology product portfolio. • acquiring the food safety assets of Australia-based Cell BioSciences, a supplier of food safety and industrial microbiology products, for $3.8 million. • acquiring Chile-based Magiar Chilena, a distributor of food, animal and plant diagnostics, for $400,000. • acquiring the U.S. rights to StandGuard Pour-on, which combats horn fly and lice within domestic beef cattle, from global animal products supplier Elanco Animal Health Inc. for nearly $2.4 million. The deal was mandated by the Federal Trade Commission for Elanco to move forward with its $7.6 billion acquisition of Bayer Animal Health GmbH. Neogen’s purchase was finalized on July 31, 2020.
n The $21.9 million merger of Muskegon-based Community Shores Bank Corp. into Sparta-based ChoiceOne Financial Services Inc. closed after earning shareholder approval. The two banks consolidated in the fourth quarter with Community Shores taking on the ChoiceOne name. At the close of the deal ChoiceOne had 29 offices in West and Southeastern Michigan with about $1.5 billion in assets. Community Shores had about $220 million in total assets with three offices in Muskegon County and one in Grand Haven in neighboring Ottawa County. n A pair of Indiana cooperatives formed a strategic joint venture to acquire an Allegan County agricultural retail business owned by CHS Inc. Crawfordsville, Ind.-based Ceres Solutions and Avon, Ind.-based Co-Alliance LLP closed on the deal in September for the business located at 4671 E. Washington St. in Hamilton, southeast of Holland. It was renamed Endeavor Ag & Energy LLP.
JULY n Grand Rapids-based TG Manufacturing Group acquired the gaming machine integration division of Turnkey Fabrication LLC, which operates in a 20,000-square-foot facility in Grand Rapids and supplies businesses in the gaming sector across North America. The new division is called TG Integration LLC. TG Manufacturing Group will now manufacture complete integrated gaming machine assemblies following two prior acquisitions of Grand Rapids-based A2Z Powder Coating and the metal fabrication division from Turnkey Fabrication. Terms of the latest deal were not disclosed. n Harbor Springs-based Walstrom Marine Inc. acquired Traverse City-based Traverse Bay Marine Inc. from longtime owner James Rautio, according to a report in the Traverse City Record-Eagle. Walstrom, a dealer for
high-end freshwater boats including Sea Ray, Tiara Yachts, Chris Craft and Pursuit Boats, adds new brands with the deal, including Lund Boats, Sea Doo and Crest Pontoons. The deal also included Traverse Bay Marine’s location at U.S. 31 in Traverse City, according to the report. n Private equity-backed CloudAccess LLC, a Traverse City-based cloud hosting provider that also operates an office in Poland, has completed the addon acquisition of Miller Media Inc., a 30-year-old Bloomfield Hills-based web development and search engine optimization company. The deal will allow teams at both companies to expand service offerings, according to a statement. Terms of the deal were not disclosed. CloudAccess is a portfolio company of New York City-based Cloud Equity Group, a private equity and investment management firm focused on companies in web hosting and cloud-based infrastructure. n Private equity-backed Heartland Home Services acquired Jenison-based First Call Plumbing Inc. A family-owned provider of residential plumbing services with a 20-year market history, First Call Plumbing joins the Macomb-based Heartland Home Services platform, which has completed four strategic acquisitions, including a prior deal for Grand Rapids-based Vredevoogd Heating & Cooling. Heartland Home Services is a portfolio company of North Branch Capital LLC, an Oak Brook, Ill.-based private equity firm. Terms of the First Call deal, which closed June 15, were not disclosed. n Lansing-based Liquid Web LLC, a private equitybacked hosting and application services provider, acquired Fishers, Ind.-based ServerSide Inc., a web development and managed cloud services company, according to a statement. ServerSide founder and CEO Steve Oren and the company’s team remained in place after the acquisition. Terms of the deal were
not disclosed. Liquid Web is a portfolio company of Chicago-based Madison Dearborn Partners LLC. n A long-standing partnership turned into the sale of a significant business unit for Blue Medora Inc., a venture capital-backed Grand Rapids-based software developer. After partnering with software virtualization giant VMWare Inc. (NYSE: VMW) for several years, the Palo Alto, Calif.based software company acquired Blue Medora’s True Visibility Suite team and products. The deal was finalized on July 7 for an undisclosed sum. Blue Medora’s True Visibility Suite contains solutions that easily integrate into and enhance the performance of VMWare’s AI-driven vRealize platform. Terms of the deal were not disclosed. n Grand Rapids-based FormulaFolios Investments LLC merged with Chicago-based Brookstone Capital Management in a deal that will create an investment adviser firm with more than $6.5 billion in assets. The merged firm will keep the Brookstone name and retain the Grand Rapids-based FormulaFolios brand for continued oversight of its asset management division. Brookstone intends to maintain both headquarters in Chicago and Grand Rapids. Formed in 2011, FormulaFolios serves hundreds of financial advisers and thousands of clients nationwide. At the end of 2019, the firm managed $3.64 billion in assets. FormulaFolios also maintains an office in Costa Mesa, Calif. A year ago, Clearwater, Fla.based AmeriLife Group acquired a majority stake in Brookstone. AmeriLife is backed by Boston, Mass.-based private equity firm Thomas H. Lee Partners L.P. n A partnership of Mason Asset Management and Namdar Realty Group acquired the majority of the assets of Grand Rapids-based Goodrich Quality Theaters Inc., which filed for Chapter 11 bankruptcy in February. The $12 million deal, which includes 12 theater locations in Michigan, seven in Indiana, two in Missouri and one in Illinois, took effect on July 13, according to a statement. That includes West Michigan locations in Ada/Lowell, Grand Haven, Kalamazoo, Holland, Battle Creek, Hastings and Cadillac. The buyers, both based in Great Neck, N.Y. and doing business under Goodrich Theater Newco LLC, a Delaware corporation, are working with theater operator VIP Cinemas to manage the 21 locations. The sale, which was approved by the U.S. Bankruptcy Court for the Western District of Michigan, did not include a theater in Oswego, Ill., which was sold in a separate $4.95 million deal to Downers Grove, Ill.-based Tivoli Enterprises Inc., according to court records. As well, court records indicate that Goodrich Quality Theaters sold its 50-percent stake in Florida-based Gibsonton Theaters LLC for $1.1 million to AP Gibsonton LLC.
AUGUST n Grand Rapids-based Acrisure LLC acquired the insurance practice of Tulco LLC, a Pittsburgh, Pa.based provider of artificial intelligence and machinelearning technology, in a $400 million deal. The acquisition matches the global reach of Acrisure with Tulco’s AI expertise and follows a year-long partnership between the firms, which previously formed Altway Insurance, an AI-backed insurance brokerage initially focused on individual health benefits. The deal was structured as a stock-for-stock trade, with Tulco becoming a significant minority shareholder in Acrisure. Grand Rapids-based Varnum LLP advised Acrisure on the deal. n Kalamazoo-based National Flavors LLC, a producer of flavors and extracts for the food and beverage industry, acquired GSB & Associates Inc., a Kennesaw, Ga.-based company specializing in flavor development. The deal was the first bolt-on acquisition for National Flavors since becoming a platform company for The Riverside Co., a Cleveland, Ohiobased private equity firm. GSB’s portfolio of liquid and powdered flavors, masking agents and flavor enhancers Visit www.mibiz.com
complements National Flavors’ existing library of flavors, according to a statement. Terms of the acquisition were not disclosed. n Via its Italy-based Poltrona Frau Group, Hollandbased Haworth Inc. acquired Luxury Living Group, an Italian furniture maker and interior design company that produces and distributes high-end furniture in Italy. The company works under licensing agreements with such brands as Fendi Casa, Bentley Home and Bugatti Home. Luxury Living has a worldwide network of 80 retailers and directly owned stores in Milan, Paris, New York, Los Angeles and Miami. The company generated about $104 million in revenue, down from a reported $139 million in 2017, and employs 250 people. Terms of the deal with Haworth were not disclosed. n Wyoming, Mich.-based C.G. Witvoet & Sons Co., a fourth-generation family-owned custom sign maker, was acquired by JBLR & Associates LLC, a Jackson-based investment group. C.G. Witvoet & Sons, founded in 1932, operates from two facilities in the Grand Rapids area and serves as a manufacturer and wholesaler of interior retail store décor, signage and displays. The company had been looking for a partner with additional resources to help scale up, CFO Pete Musser said in a statement. Terms of the deal, which was finalized in June, were not disclosed. C.G. Witvoet & Sons was advised on the deal by Grand Rapids-based M&A firm Calder Capital LLC. n Greenville-based FabX Industries Inc. acquired Elite Tooling LLC in Kalamazoo. Shane Smith, who founded Elite Tooling in 1996 at the age of 18, remained with the company as president. Elite Tooling serves pharmaceutical, medical and aerospace manufacturers in the Kalamazoo area with a focus on low-volume, highprecision and fast turnaround work. The acquisition enables FabX Industries to expand its reach into highprecision machining and makes Kalamazoo a “strategic location to service our customers in Northern Indiana,” owner Gopi Ganta said. A machining and fabrication service provider, FabX Industries is the parent company of Aquest Machining & Assembly and LaserTec. Terms of the deal were undisclosed. Grand Rapids-based Calder Capital LLC advised Elite Tooling in the transaction. n Covington, Ky.-based manufacturer ProMach Inc. enhanced its packaging machinery capabilities with the purchase of Holland-based Fogg Filler Co. LLC, a third-generation family-owned company. Over six decades, Fogg Filler has grown to become a leader in rotary filling systems for the food and beverage industry. Owner Ben Fogg will continue to lead the team of more than 170 employees at the company’s 107,000-squarefoot location in Holland. A platform company backed by Los Angeles-based private equity firm Leonard Green & Partners LP, ProMach is a provider of complete packaging machinery solutions, engineering and integration services for food, beverage and pharmaceutical companies. Terms of the deal were not disclosed. n Grand Rapids-based VNN Inc., a high school sports communication platform, carved out a foothold in Washington state with its acquisition of Lynden, Wash.-based Washington Prep Athletics Network. Similar to VNN, WPA Network has become the largest provider of data management tools for athletic directors throughout Washington. VNN has partnerships with roughly 10 percent of the high school sports programs in the U.S., but was only connected with three schools in Washington. With the deal, VNN is now connected with 35 athletic conferences in the state, or roughly 85 percent of the schools in Washington. Terms of the deal were not disclosed. Visit www.mibiz.com
n Flint-based Patriot Supply Inc., which does business as Capitol Supply and Service and has locations in Grand Rapids and Lansing, was acquired by Fremont, Ohio-based Style Crest Inc. Capitol Supply is a building products distribution and HVAC installation and servicing business for the manufactured housing industry. The company had completed several rounds of shareholder buyouts over the years and was ready to find a long-term strategic partner to grow the business, according to a statement. For Style Crest, a provider of HVAC and manufactured home products and services, the deal allows the company to expand its installation and servicing capabilities to a new state. Southfield-based investment banking and private investment firm Cascade Partners LLC advised Capitol Supply on the deal. n Perrigo Co. plc acquired three skin care and hair loss brands from Parisbased Sanofi for approximately $62 million. In the 12 months leading up to June 30, the three treatments generated combined sales of $23 million. The deal, which was announced in August and closed Oct. 30, fits with Perrigo’s transformation into a self-care company and boosts its skincare and personal hygiene product portfolio, according to a filing. n A wholly owned subsidiary of Kalamazoo-based Midwest Fastener Corp. acquired most assets of Hy-Ko Products Co., a manufacturer of numbers, letters, signs, keys and accessories based in Northfield, Ohio, according to a statement. The new company, Hy-Ko Products Company LLC, retained all previous employees. A manufacturer of nuts, bolts, anchors, deck and drywall screws and specialty fasteners, Midwest Fastener expands its product capabilities and enters a new North American market in the deal. The buyers were represented by Grand Rapidsbased law firm Rhoades McKee PC. n Grand Rapids-based Surge Cardiovascular has been acquired by Sycamore, Ill.-based MED Michigan Holdings LLC, an affiliate of medical device specialty distributor MED Alliance Solutions, according to a statement. Surge Cardiovascular is a medical device company that designs, develops and manufactures cardiopulmonary bypass cannula and cardioplegia delivery systems as well as blood management, organization and temperature management products. MED Alliance had been the exclusive distributor of Surge Cardiovascular’s products since 2012. n Brown & Brown of Michigan Inc., a subsidiary of Daytona, Fla.-based Brown & Brown Inc., acquired substantially all of the assets of Grand Rapids-based insurance agency Buiten & Associates LLC, according to a statement. The Buiten & Associates team continues operating from its Grand Rapids office under the leadership of Paul Buiten. n Muskegon marketing and advertising firm Ignite merged with New School, an agency also based in Muskegon. The merger expands New School’s marketing capabilities and capacity. The merged agency maintained its office in Muskegon and all existing staff. Justin Young joined the organization as senior program manager, and Ignite founder Larry Young serves as senior marketing specialist. n M. J. Van Damme Inc., a construction firm based in Gwinn, Mich. about 20 miles south of Marquette in the Upper Peninsula, was acquired by Scottsdale, Ariz.-based private equity firm Eberhart Capital LLC, according to a statement. The $20 million to $50 million deal adds trucking and quarry expertise to Eberhart’s existing construction portfolio. M. J. Van Damme Inc. employs 130 people and provides specialized construction support services to the mining, farming and civil construction industries. The firm also repurposes various wastes into materials used on construction projects. n Grand Rapids-based SpendMend LLC, which provides spending visibility and audit recovery services to
WEST MICHIGAN’S TOP DEALS & DEALMAKERS MiBiz presents the 8th Annual M&A Deals & Dealmakers Awards to spotlight best practices and excellence related to mergers, acquisitions, capital formation and other types of deal making throughout Western Michigan. We are seeking nominations for deals completed between July 1, 2019 and Dec. 31, 2020 in the following categories: n Deal of the Year: Manufacturing n Deal of the Year: Professional Services n Deal of the Year: Finance/Banking n Deal of the Year: Retail Sector n Deal of the Year: Real Estate/Development n Deal of the Year: Economic Development n Deal of the Year: Health Care n Deal of the Year: Life Sciences n Deal of the Year: Technology n Deal of the Year: Nonprofit n Dealmaker of the Year/Executive n Dealmaker of the Year/Adviser n Dealmaker of the Year/Investor Winners will be featured in a special editorial section in the February 15, 2021 print issue of MiBiz. Plus, we’ll highlight each of the winning companies and executives online and share their stories with industry professionals, executives, advisers, investors and other potential allies. It’s an exceptional opportunity to source new deals, attract employees, access capital and create strategic growth opportunities. The deadline for nominations is January 8, 2021 at 11:45 p.m.
NOMINATIONS OPEN:
MIBIZ.COM/DEALS For sales information, contact sales@mibiz.com.
See 2020 M&A DEALS ROUNDUP on page 18 MiBiz / JANUARY 4, 2021
17
2020 M&A DEALS ROUNDUP the health care industry, acquired two related companies, TurnKey Pharmacy Solutions and Elevate340B, both based in Draper, Utah. The company rebranded the firms as SpendMend Pharmacy, which will focus on compliance, optimization and growth services for 340B programs in the health care industry. The 340B program requires drug makers to provide discounted medication to hospitals and clinics providing care to uninsured or vulnerable patient populations. TurnKey offers 340B audit and compliance services and established Elevate340B to consult with hospitals to grow their use of 340B programs. Terms of the deal were not disclosed. n Grand Rapids-based law firm Miller, Johnson, Snell & Cummiskey PLC acquired Detroit-based law firm Lusk Albertson PLC in a deal that closed Aug. 31. Lusk Albertson focuses its practice on the education sector. The combined firm will have 105 attorneys practicing at three offices statewide, and “represents an opportunity for Miller Johnson to establish an even stronger foothold in the greater Detroit market,” according to an announcement of the deal. Terms of the deal were not disclosed. Lusk Albertson partner Kevin Sutton will lead the Detroit office as managing member. n Grand Rapids-based Waséyabek Development Co., the non-gaming economic development arm of the Nottawaseppi Huron Band of the Potawatomi,
PE-BACKED HIGH STREET INSURANCE PARTNERS CONTINUES DEAL STREAK
H
igh Street Insurance Partners, a Traverse City-based agency platform backed by private equity, completed a series of nationwide acquisitions in 2020. Since forming in 2018 with backing from Detroit-based private equity firm Huron Capital, High Street Insurance Partners has completed 15 acquisitions and continues to pursue an acquisition strategy. The company’s 2020 deals included: • Ken Bleeker Insurance Agency in Martin, Mich. • Trust Shield Insurance Group of Schoolcraft, Mich. • Gates-Cole Associates in New Hartford, N.Y. • Tall Pines Insurance Services of Boonville, N.Y. • an unspecified book of business in Verona Beach, N.Y. • Capital Insurance Group of Bloomfield Hills, Mich. • Tracy, Driscoll & Co. Inc. in Bristol, Conn. • Millennium Alliance Group LLC in Long Island, N.Y. Terms of the deals were not disclosed.
18
JANUARY 4, 2021 / MiBiz
closed on a deal on Aug. 20 to acquire Re-source Industries Inc., a family-owned manufacturer based in Muskegon. Previous owners Paul and Randi Kuyt remained with the company, which was renamed RSI of West Michigan. The company is a high-volume manufacturer of parts for a range of products, including ATVs, autos, snowmobiles and archery bows, and employs 44 people. RSI offers CNC machining and rapid prototyping and operates from a more than 40,000-square-foot facility on South Getty Street in Muskegon. Grand Rapids-based Calder Capital LLC sourced the deal for Waséyabek. n Grand Rapids-based private equity firm Blackford Capital sold Fort Wayne, Ind.-based Ellison Bakery, a maker of cookies and other baked goods. Blackford Capital sold Ellison Bakery to Tilia Holdings, a Chicago-based private investment firm founded in 2017 that invests in the food supply chain. Blackford Capital acquired Ellison Bakery in 2017. Terms of the sale to Tilia Holdings were undisclosed. n Traverse City-based investment firm Boomerang Catapult LLC sold Taste the Local Difference, a food marketing agency, to individual investor Jody Trietch, according to a report in the Traverse City Record-Eagle. Trietch serves as CFO of Boomerang Catapult, which bought the organization from Groundwork Center for Resilient Communities in 2018. Under Trietch’s leadership, the company looks to expand its services beyond Michigan, according to the report.
SEPTEMBER n Grand Rapids-based BlueWater Partners served as exclusive financial adviser to Douglas Corp. of Minneapolis, Minn. in its sale to Aludec USA Inc. Douglas is a designer and manufacturer of product identification and user interface products for the automotive, truck, marine, agriculture and construction industries. Spain-based Aludec designs and manufactures exterior and interior automotive parts. Terms of the deal were not disclosed. n Brent Slagell and Jim Zawacki — part of the ownership group of Lowell-based Big Boiler Brewing — acquired Castle Brewing in Greenville under the entity Hophog LLC. Terms of the deal were undisclosed. n Pro-Vision Video Systems, a West Michigan producer of body-worn cameras and rear vision and video recording systems used worldwide, acquired St. Petersburg, Fla.-based Zone Defense LLC. Aligning with Pro-Vision’s products, Zone Defense develops, engineers and manufactures advanced vision systems for automotive and fleet industries. Pro-Vision is owned by Bostonbased private equity firm JMC Capital Partners. n Grand Rapids-based medical and biotechnology manufacturing firm Medbio LLC acquired Orchard Park, N.Y.-based Polymer Conversions Inc., which specializes in contract medical device manufacturing involving thermoplastic injection molding. Medbio officials say Polymer Conversions is “highly complementary” and expands the company’s “geographic presence.” Terms of the deal were undisclosed. Philadelphia, Pa.-based private equity firm Graham Partners owns a majority stake in Medbio. n Ceresco, Mich.-based Integrated Manufacturing Concepts LLC was acquired by individual investor Tom Tilma. The Calhoun County company manufactures tube fabrication and bending products, serving a variety of different industries. Terms of the sale were undisclosed. Grand Rapids-based M&A firm Calder Capital LLC advised Integrated Manufacturing Concepts in the deal. n Walker-based snack food maker Cheeze Kurls Inc. was acquired by Kilroy Partners, a Boca Raton, Fla.based private investment firm. Former Cheeze Kurls
co-owners, President Timothy Dedinas and Vice President Robert Franzak, retained a minority ownership and remain in advisory roles with the company. Kilroy Partners will maintain the company’s Grand Rapids operations. Franzak described Kilroy Partners as the right buyer for Cheeze Kurls, as previous potential buyers have proposed closing the plant and moving operations out of state. n A long-standing New Buffalo ice cream and yogurt shop Oink’s Dutch Treat was sold to an individual investor Michael Schimanski. Grand Rapids-based Small Business Deal Advisors advised former owner Roger Vink on the deal. n Grand Rapids-based engineering consultant Foresight Management acquired Sustainable Research Group LLC, a long-standing pioneer in the realm of sustainable business practices. Sustainable Research Group founder Bill Stough was the inaugural inductee of the Michigan Sustainable Business Hall of Fame. n Grand Rapids-based office technology solutions provider Applied Imaging has grown its presence in Florida through the acquisition of Tampa Bay-based Upstream Office Solutions. The acquisition gives Applied Imaging a total of 14 offices spread throughout Michigan, Ohio and Florida. Terms of the deal, which was finalized in late August, were undisclosed. n Rosemont, Ill.-based Brennan Investment Group established a joint venture equity partnership with Saudi Arabia-based investment firm Arbah Capital to acquire 557,000 square feet of light industrial and flex space, including two sites in West Michigan. The properties include 5460 Executive Parkway in Cascade Charter Township, which is occupied by Tesla Tool and Die, and 1865 Industrial Drive in Grand Haven, which is occupied by Lakeshore Fittings Inc. Global real estate services firm JLL Capital Markets connected Brennan and Arbah, as well as helped the newly formed joint venture equity partnership secure $22.9 million in debt financing via a 5-year floating-rate loan with Wintrust Bank.
OCTOBER n Cascade Charter Township-based Hart & Cooley LLC, a manufacturer of air distribution products for both residential and commercial HVAC clients that was formerly owned by Johnson Controls International plc, sold to Miami-based global private equity firm H.I.G. Capital, which will now operate it as its own entity. Hart & Cooley manufactures grilles, registers, diffusers, flex air duct systems, air filtration components, chimneys systems and other components. The company will maintain its headquarters at 5030 Corporate Exchange Blvd. SE, near the Gerald R. Ford International Airport. n Marne-based DeWys Manufacturing Inc. acquired Grand Haven-based metal fabricator ReFab LLC. Established in 1977 as a one-person metal shop, DeWys Manufacturing, provides custom metal fabrication services. The deal allows DeWys Manufacturing to expand its core capabilities — cutting, forming and welding — while also facilitating quicker turnaround times and the ability to meet the evolving needs of clients. n Ludington-based Foam Works LLC, a young business specializing in spray foam and cellulose insulation, sold to an individual investor. Foam Works was founded in 2017 by Dann and Julie Van Dyke, who together own property maintenance and construction company Cottage Works Corp. The couple ultimately decided to sell Foam Works to focus on their other business. Terms of the deal were undisclosed. Grand Rapids-based Small Business Deal Advisors LLC advised the VanDykes on the sale. n Traverse City-based Hagerty Insurance Agency Inc., an insurer of classic cars and high-end automobiles,
acquired the California Mille car rally from the founding Swig family, according to a statement. The California Mille travels a route along northern California’s mountains and coastal roads and is limited to 65 cars annually. The deal follows Hagerty’s 2019 acquisition of Greenwich Concours d’Elegance, a 25-year-old family-run car show in Greenwich, Conn., and bolsters the portfolio of “immersive automotive experiences” for the Northern Michigan firm. n An employee group took a majority ownership position in investment advisory firm Red Cedar Investment Management LLC. Under the terms of the deal, Delta Dental of Michigan subsidiary The 4100 Group Inc. issued 51 percent of its common shares to Bridge & Vine LLC, a Michigan company owned by a core group of six Red Cedar Investment professionals. The 4100 Group retained a 49 percent equity stake in Red Cedar. John Cassady was named CEO of the new ownership structure that took effect Oct. 1. He also remains chief investment officer at Red Cedar, which employs 13 people and has $1.4 billion in assets under management. n Schoolcraft-based LNS Manufacturing Inc. acquired Grand Rapids-based Van’s Pattern Corp., a family-owned manufacturer with 60 years of experience in polystyrene patterns and prototypes. Van’s Pattern operates out of a 40,000-square-foot facility at 11 Sweet St. NW on Grand Rapids’ north side, where it uses CNCcontrolled cutting machines to create detailed patterns and prototypes for the auto industry in addition to special tool manufacturers and foundries. The deal was brokered by Hudsonville-based NuVescor Group. n Denver-based GrowGeneration Corp., which operates specialty retail hydroponic and organic gardening stores throughout the country, recently acquired Michigan’s Big Green Tomato, a hydroponic equipment store with locations in Taylor and Battle Creek. Big Green Tomato has a strong commercial operation and generates around $16 million in revenue. With the deal, GrowGeneration now owns and operates six stores across Michigan.
NOVEMBER n Building products dealer and manufacturer Zeeland Lumber & Supply Co. was acquired by US LBM Holdings LLC, one of the largest specialty building product distributors in the country. Zeeland Lumber & Supply operates three manufacturing facilities and three building material yards scattered throughout Michigan and Northern Indiana. With the deal, US LBM now operates 16 locations in Michigan. n Minneapolis, Minn.-based engineering and environmental consulting firm Barr Engineering Co., which has offices in Kentwood and Ann Arbor, acquired Grand Rapids-based King & MacGregor Environmental Inc. King & MacGregor specializes in natural resource consulting and environmental services, particularly wetland and water body assessments, the design of constructed wetlands and environmental reviews and permitting. Terms of the deal were not disclosed. n Grand Rapids-based private equity firm Auxo Investment Partners acquired Elmhurst, Ill.-based GC Dies, a steel rule die cutting manufacturer with a 37,500-square-foot facility. The manufacturer employs 50 employees and specializes in flat corrugated, rotary corrugated and flat steel rule die production. n Chicago-based private equity firm Westbourne Capital Partners completed a strategic investment in Grand Rapids-based Proos Manufacturing, which specializes in designing and manufacturing material handling solutions. The investment, made to support Proos Manufacturing’s rapid growth in domestic and international e-commerce fulfillment, was made in partnership with Samson Investment Partners, Visit www.mibiz.com
which is based in New York and Dallas, in addition to a group of additional family offices. Terms of the deal were not disclosed. n Belding-based Flat River Group, a toy and game distributor, acquired Optimum Fulfillment, an Illinoisbased company that services the e-commerce industry as a wholesaler of toys, games and other consumer products. Optimum Fulfillment sells to the likes of Amazon, Walmart and Target, according to a statement. Flat River Group will continue to operate Optimum Fulfillment’s facility in Peru, Ill. n Grand Rapids-based TTS Logistics, a transporter of specialty produce, was acquired by LaFayette, La.-based Dupré Logistics, an energy and chemical trucking firm, according to a statement. The deal marks the entry into a new market for the privately held Dupré, which aims to grow its “asset light business unit” to $200 million in sales by 2024. TTS Logistics’ 15 employees have joined the team at Dupré, which will maintain the company’s offices in Grand Rapids and Mount Pleasant. Dupré operates 750 trucks and employs more than 1,100 drivers, according to a statement. Terms of the deal were not disclosed. n Ada-based Century Technology Group Inc., a family office that provides tech companies with growth capital, administrative resources and managerial consulting, acquired custom software and app developer Grand Rapids-based Mutually Human. Century Technology Group plans to invest in strategic sales and marketing to grow Mutually Human, in addition to recruiting outside talent and adding complementary development capabilities. Terms of the deal were not disclosed. n Holland-based Major Brands Oil Co. acquired Central Oil Co., a Roseville-based distributor that specializes in industrial and commercial lubricants throughout Southeast Michigan and parts of Ohio. Central Oil offers next-day delivery for coolants, lubricants, oils and speciality chemicals and gives Major Brands Oil a foothold in the metro Detroit region. Terms of the deal were not disclosed.
DECEMBER n Fruitport-based medical device supplier Motion Dynamics LLC, a portfolio company since 2016 of Los Angeles-based private equity firm Vance Street Capital, completed its first add-on acquisition with a deal for ViaMed Holdings LLC. The Easton, Mass.-based ViaMed manufactures miniature precision components and subassemblies for medical device manufacturers in the neurovascular, peripheral vascular and orthopedic markets. The deal complements Motion Dynamics’ capabilities and allows the company to “simplify the supply chain” for device manufacturers, President Chris Witham said in a statement. Terms of the transaction were not disclosed. Motion Dynamics was advised by Chicagobased Vedder Price LLP, while Attleboro, Mass.-based Coogan Smith LLP served as legal adviser to ViaMed. n Caledonia-based Aspen Surgical Products Inc. completed its third acquisition in less than a year with a deal for Coralville, Iowa-based Protek Medical Products Inc. The acquisition “strengthens Aspen’s broad portfolio of medical and patient and staff safety products sold into hospital and surgery center markets,” according to the company. Protek Medical Products produces single-use ultrasonic probe covers and needle guides used in tissue biopsies, fluid aspiration and vascular procedures, as well as protective covers for medical instruments and equipment. Terms of the deal were undisclosed. Aspen Surgical is a platform company of Boston-based Audax Private Equity. n New York City-based private equity firm ASGARD Partners & Co. acquired a controlling interest in Angstrom Technology, a Grand Rapids-based company that designs, builds and maintains modular Visit www.mibiz.com
TETRA THERAPEUTICS’ SALE OFFERS HEALTHY RETURNS FOR INVESTORS
G
rand Rapids-based Tetra Therapeutics Inc.’s sale to Japanese pharmaceutical company Shionogi & Co. Ltd. provides a final pathway toward bringing to market potential new drugs to treat Alzheimer’s disease and a form of autism, as well as generates a handsome return for financial backers.
Investors in a $7.2 million Series A capital round Tetra raised in 2016 got a return of five times their original investment, according to founder and CEO Mark Gurney. Participants in an earlier July 2013 debt offering got an ROI that’s close to 13 times their investment, he said. “We returned a lot of capital to Michigan,” said Gurney, who started Tetra Therapeutics in 2011 and methodically built and led the company down the R&D pathway toward an exit for investors. “This is a tremendous win for West Michigan, both for our investors and stakeholders,” Gurney told MiBiz for a July report. Tetra’s merger into Shionogi & Co. Ltd., first announced in May 2020, could ultimately reach a transaction value of $500 million if certain regulatory and sales milestones are met over the years. Under the deal, Shionogi & Co. acquired Tetra’s portMark Gurney, founder and CEO folio of drug compounds for treating Alzheimer’s disease, of Tetra Therapeutics. MIBIZ FILE PHOTO: ADAM BIRD Fragile X syndrome and other brain disorders associated with cognitive or memory conditions. Tetra became a wholly owned subsidiary of Shionogi, which obtained global rights to all of Tetra’s drug compounds, including one known as BPN14770 for Alzheimer’s. The deal represents one of the largest exits to date for a startup company formed and nurtured in West Michigan and supported by local investors. Michigan-based investors in Tetra included Grand Angels and its Ka-Zoo Angels affiliate, Kalamazoo-based Apjohn Group LLC, Muskegon Angels, Traverse City-based Northern Michigan Angels, Ann Arbor SPARK, the Michigan Economic Development Corp.’s Invest Michigan fund, and the Bioscience Research & Commercialization Center at Western Michigan University, plus local high net worth individuals. The deal followed a March announcement that Shionogi & Co. increased its equity stake in Tetra to 50 percent, which included an option to complete a structured buyout of the remaining equity in Tetra if certain conditions were met in the company’s Phase 2 trial of its BPN14770 compound in treating Alzheimer’s disease. Advisers on the March equity deal included Cooley LLP, Honigman LLP and Nomura Securities International Inc.
cleanrooms for clients in North America. Angstrom Technology’s management team will continue to lead the company. Terms of the deal were undisclosed. Grand Rapids-based M&A firm Charter Capital Partners represented Angstrom Technology in the transaction. Dickinson Wright PLLC served as legal adviser to Angstrom, while Richmond, Va.-based McGuireWoods LLP advised ASGARD Partners. n Albion-based Caster Concepts Inc., which designs and manufactures industrial casters and wheels for a variety of industries, expanded into the aerospace and defense sectors with a deal for Los Angeles-based Aerol Co. Inc. The acquisition included Aerol’s line of aluminum casters specifically designed for the aerospace tooling industry, which bolsters Caster Concepts’ product line of heavy-duty industrial casters, wheels and polyurethane tread. Caster Concepts plans to close Aerol’s southern California operations and move it to its home facility in Albion. The company also plans to outsource the production of aluminum castings to a foundry in West Michigan. Terms of the deal were not disclosed. n Greenville-based FabX Industries Inc., a provider of machining and fabrication services, acquired Fort Wayne-based Guide Engineering LLC in a deal that
closed Oct. 31. Guide Engineering specializes in designing and manufacturing automation, assembly and test systems primarily for the automotive industry. The acquisition adds capabilities to FabX, which is focused on high-quality, cost-effective and value-added machining and fabrication services. FabX President Gopi Ganta will now take on the CEO role at Guide Engineering, where former co-owner Scott Taylor will serve as president. The deal allowed two of Taylor’s partners to transition to retirement. Grand Rapids-based mergers and acquisitions firm NuVescor Group advised Guide Engineering on the deal. Terms of the deal were not disclosed. n Chicago-based Factorial Holdings acquired 26 existing Burger King restaurants in the Grand Rapids area, where it plans to construct 10 new locations of the fast food chain over the next five years. Factorial Holdings specializes in buying restaurant companies where founders are interested in transitioning. The firm invests in family-owned companies with $500,000 to $5 million in annual earnings. n Troy-based Secure Investors Group Inc. acquired South Michigan Insurance Agency Inc. and Donald E. Thornton Insurance Agency, both based in Lawton. The deal brings the two firms additional services that include retirement savings, retirement income tactics,
mortgages and investments. The two agencies provide auto, home, farm, commercial, life and health insurance policies. Secure Investors Group — a financial services and insurance firm started in 1997 — has offices in Troy and Albion. Terms of the deal were undisclosed. n Muskegon-based Betten Baker Auto Group acquired the Buick franchise from Witt Buick, also located in Muskegon. Witt Buick will continue its business as Witt Sales, Service & Collision and will provide pre-owned sales, service and collision repair while retaining all of its current staff. With the acquisition, Betten Baker’s location at 2474 Henry St. in Muskegon will now offer every GM brand on the market. Terms of the deal were not disclosed. n Grand Rapids-based public relations and investor relations firm Lambert & Co. formed a joint venture with 9th Wonder, a Houston, Texas-based marketing and brand strategy firm. The joint venture and capital investment in 9th Wonder can accelerate the growth of both companies, according to a statement. Lambert & Co. co-founder and CEO Jeff Lambert called 9th Wonder a “perfect complement to our offerings in PR, investor relations, crisis communications and diversity consulting.” Under the deal, Lambert will join 9thWonder’s board. The joint venture includes an investor group led by Monika Mantilla, a fund manager who invests in minority, women-led and diverse-owned companies, and entrepreneurs located in low or moderate-income communities. Terms of the deal were undisclosed. n Schaumburg, Ill.-based Convergint Technologies LLC acquired Grand Rapids-based Innovative Medical Systems Inc., a reseller of acute care and technical products for hospitals. The deal will “further deepen and expand Convergint’s presence within the health care market in the United States,” according to a statement. Terms of the deal were undisclosed. Grand Rapids-based investment bank BlueWater Partners LLC served as the exclusive financial adviser and Miller, Johnson, Snell & Cummiskey PLC, also of Grand Rapids, was the legal counsel to Innovative Medical Systems, which gained access to Convergint’s global network to broaden services to clients. n Lighthouse Group, a Grand Rapids-based insurance and employee benefits agency, has been acquired by Alera Group, a Deerfield, Ill.-based independent insurance firm that has more than 90 locations across the U.S. Joining Alera Group “will open avenues for growth like never before, both for our clients and our firm,” said Tom Helmstetter, group president and CEO of Lighthouse, which has eight offices in Michigan. Terms of the deal were undisclosed. MarshBerry Capital Inc., a Woodmere, Ohio-based strategic consulting and M&A advisory firm, served as financial advisor to Lighthouse Group in the transaction. n Walker-based Pipp Horticulture acquired Vertical Air Solutions LLC (VAS), a Santa Cruz, Calif.-based producer of air circulation systems for indoor vertical farming. The acquisition was a strategic one for Pipp Horticulture, a division of Pipp Mobile Storage Systems, Inc., which specializes in vertical farming and space optimization solutions. “We have gotten to know the VAS team well in recent years, as they have been an integral part of our horticulture business, and their products are the ideal addition to our Mobile Vertical Grow Rack Systems,” said Craig Umans, President and CEO of Pipp. “We look forward to integrating their leading technology into our continually expanding product offering to better serve the fast‐growing vertical indoor farming industry.” n Texas-based Mueller Industries Inc. announced that it signed a definitive agreement to purchase the flexible duct business from Grand Rapids HVAC contractor Hart & Cooley Inc. Greg Christopher, CEO of Mueller Industries, said the acquisition, which is expected to close in late January 2021 will “expand our footprint in the air quality and climate control systems markets.” MiBiz / JANUARY 4, 2021
19
Karen Kania and Peg McClure support nonprofits addressing basic needs. In particular, they’re focused on safe housing and alleviating hunger. They believe that if a person can’t nourish their body, they can’t nourish their spirit. As Karen and Peg considered what would happen to their assets after their lifetime, their professional advisor connected them to Grand Rapids Community Foundation. After their passing, the McKania Fund for the Economically Disadvantaged will be established at the Community Foundation to continue their legacy of providing for people facing housing and food insecurity. L E T U S H E L P YO U G E T S TA R T E D We’re here to help you understand your options and explore creative ways to leave your mark on the community and causes you love. Give us a call at 616.454.1751.
L E AV E YO U R M A R K
grfoundation.org
20
JANUARY 4, 2021 / MiBiz
Visit www.mibiz.com
NONPROFIT ORGANIZATIONS
Kids Count report highlights toll of COVID-19 pandemic on Michigan families By MARLA MILLER | MiBiz mmiller@mibiz.com
T
in recent weeks by Gov. Gretchen Whitmer. On Dec. 29, Whitmer signed a $106 million relief package that includes an unemployment benefit extension, small business relief and direct payments to some workers. “This data is really relevant moving forward,” Perdue said. “The impact is still going to be there. Sixty percent of families have lost employment income since March, and it’s still hovering around 50 percent. That has a cascading effect on how to meet basic needs as well as access to health insurance.”
he coronavirus pandemic is taking a toll on children and families who are struggling to meet basic needs while stretching nonprofits that provide essential services around food, shelter and mental health, according to a new report. In mid-December, the Baltimorebased Annie E. Casey Foundation released a special COVID-19 Kids Count report that featured Michiganspecific data and highlights the pain Equitable food systems points families face. In general, famineeded lies are struggling with hunger, housPartners of the Kent County Essential ing, health insurance and mental Needs Task Force report food insecurity health, the survey found. is a significant need that has increased An average of 62 percent of since the pandemic began. Locally, food Michigan households with children banks are seeing more new families as have lost employment income since well as a higher frequency of visits, said March 13, 2020, according to the Wende Randall, director of the Essential report, “Kids, Families and COVID-19: Needs Task Force. Pandemic Pain Points and a Roadmap The goal has been to make sure for Recovery.” That percentage has food distribution centers and access declined in more recent weeks but is points are welcoming and barrier free, still hovering at 51 percent. and that there isn’t a feeling of judgKids Count releases a data book ment for those first-time food bank every spring, but the Annie E. Casey visitors. Foundation developed the special “What is interesting here is the 50-state report of recent household overall food supply for data to assess how famiWest Michigan has been lies are faring during the NONPROFITS fairly steady,” Randall public health crisis, said NEWS said. “The challenge Kelsey Perdue, the Kids — is ensuring we have Count director at the Sponsored by: GRAND RAPIDS nutritious foods where Michigan League for COMMUNITY people can access them Public Policy. FOUNDATION easily.” The survey examErin Skidmore, Good ined data from weekly Food Systems director at Access of surveys conducted by the U.S. Census West Michigan, said the economic criBureau, substantiating reports of famsis brought on by COVID-19 has highilies challenged to meet basic needs lighted the disparities that existed long along with managing school, work and before the pandemic began. Access mental health. of West Michigan works with com“We’re looking at pretty timely data munity centers, the faith-based comspecific to the pandemic,” Perdue said. munity, health sites and food pantries “This is giving us some concrete data to address the root causes of poverty, and information to pair with the stoincluding the need for living wage ries we’ve been hearing this year. It’s jobs, affordable housing, and equitaa more concrete idea of how families ble access to food. with children are doing.” “There is a need for an emergency The Michigan League for Public response, but part of the problem with Policy and its Kids Count project charity food is that we aren’t working have used the data to support several to prevent the need from being there,” COVID-19 relief measures, including she said. “We are simply band-aiding a six-week extension of emergency the response.” unemployment benefits, a moratoAccess of West Michigan partrium on water shutoffs and the $100 ners have seen an increased number million COVID relief fund proposed Visit www.mibiz.com
KIDS COUNT DATA Michigan-specific statistics from the Annie E. Casey Foundation’s COVID-19 Kids Count report:
As of Oct. 12, the percentage of Michigan households with children that have felt nervous, anxious or on edge for more than half of the days or nearly every day for the past seven days, and 22 percent said they felt down, depressed or hopeless for half or more of the previous week.
34% 7%
As of Oct. 12, the percentage of Michigan residents raising children reported being uninsured.
1/3
Because of COVID-related insurance access, medical costs and exposure concerns, nearly onethird of Michigan families reported delaying medical care. And a quarter of Michigan households raising kids said they did not get needed medical care because of the COVID-19 crisis.
The rough percentage of Michigan households with children that have reported “sometimes or often” not having enough food to eat in the previous seven days. The same percentage of Michigan parents say they have slight or no confidence in paying their next rent or mortgage payment on time.
15%
of unemployed workers and people accessing food resources for the first time, though some food relief sites have reported seeing fewer people as more locations pop up. “This year, it’s been interesting to see all the disparities highlighted, but they are not new,” she said. “So many people are living one accident or one hospital visit away from the poverty level. We need to address the fact that there aren’t living wage jobs.”
Housing, education gaps The pandemic has continued to tax housing resources for individuals and families experiencing homelessness. Last month, Mel Trotter Ministries opened an overflow shelter for individuals in the former Purple East building across from Heartside Park to address a ballooning homeless encampment there, which pushed city officials to clear the area in mid-December. Family Promise of Grand Rapids in March saw an immediate increase in families seeking shelter — from 35 to 70 families. The need has remained steady throughout the year, with 85 families staying in an emergency hotel shelter two days before Christmas, said Kate O’Keefe, Family Promise’s director of development and community engagement. Family Promise moved families from a shelter setting into extended-stay hotels because of COVID-19 concerns. “It is a huge need in West Michigan,” O’Keefe said. “We have families who are living paycheck to paycheck and can’t make ends meet.” Family Promise has advocated for the extended moratorium on evictions and provides a variety of support to families in the program. Most are young, single moms with young
children. The goal is to get them into permanent housing they can afford, and many clients have paid ahead on their bills when they do receive assistance. “These are hard-working families who are doing everything they can to stay in their housing during a global pandemic,” she said. Randall said families — and agencies that support them — are worried about housing issues, educational disparities, and access to mental health resources. “We definitely have been hearing that education is a very stressful area for families right now and part of that is the whole digital divide,” Randall said.
Nonprofits crucial for policy action Looking ahead in 2021, nonprofits can use the Kids Count data to advocate for policies and funding to support services that help families. “The nonprofit voices — those on the ground working with families who see these numbers through real stories — are a necessary component of advocacy,” Perdue said. The Kids Count data helps substantiate the need when making a case for funding, along with building collaborations among social service providers and other local groups to make sure people aren’t falling through the cracks. “We’re working together to both share resources as well as build relationships across the network of providers so people can enter the system through one door and be supported,” Randall said. “We need to be able to look at the different types of data, so we can see how they intersect so we
can come up with more comprehensive help.” Like Skidmore, O’Keefe agrees the need for affordable housing and living-wage jobs are complex, community-wide issues that were bubbling up before COVID. Various stakeholders are working to “redesign the homelessness system and catch families more upstream,” O’Keefe said. “To get away from the BandAids, we need to address why people are needing one in the first place,” Skidmore noted. Skidmore also wants to see more investment in the local farm economy, adding that nonprofits can use the Kids Count data to collaborate and combine resources in 2021. “There are so many farmers themselves who are on food stamps and food programs,” she said. “For food, for housing, for any of the larger systems that are really really broken down right now, we’ve got to get creative and work together and make more connections.” Pre-pandemic disparities for families of color, single-parent households or those living at or near poverty are being magnified, but the crisis has hit all income levels. As the recovery begins, government, advocacy organizations, businesses and citizens need to take a hard look at the ineffective systems and processes that led to severely inequitable outcomes, advocates say. “The people who may be in that middle class or upper middle class want to get back to normal, but it was a normal that wasn’t benefitting all people in the community,” Randall said. “We need entire systems to shift for all people to be in a better situation as we come out of the pandemic.” MiBiz / JANUARY 4, 2021
21
New Priority Health leader says local presence, values brought him to insurer A Q&A with Praveen Thadani, incoming president of Priority Health
P
raveen Thadani starts as Priority Health’s new president this month, moving from Humana Inc. in Chicago, where he’s worked for more than seven years. He started at Humana as Illinois market president then led strategic planning across several business lines as senior vice president of strategy, product and innovation. A veteran health insurance executive with 25 years of industry experience, Thadani succeeds Joan Budden, who retired at the end of 2020 after 12 years with Priority Health, including the last five as CEO. Thadani is expected to take on the new role in early January.
IN THE NEWS M&A
n Calgary, Alberta-based TransAlta Renewables Inc. has acquired a 29 megawatt (MW) cogeneration facility in Ada as part of a broader $439 million deal with its parent company for interests in renewable energy projects in Canada and Washington State. “This enhances our position in the renewables sector in both Canada and the U.S., launches on-site generation in the U.S. and further extends the contracted duration of our cashflows for ongoing distributions to our shareholders as we continue to target an 80 to 85 percent payout ratio for our common share dividends,” TransAlta Renewables President John Kousinioris said in a statement. The Ada facility has been in operation since 1991, and has another five years left under a power purchase agreement and steam sale agreement with Consumers Energy and Amway Corp. TransAlta Corp. acquired the Ada facility in March for about $27 million as it sought to pursue more U.S. cogeneration facilities.
What attracted you to seek the leadership position at Priority Health? When this opportunity arose, (there were) two major factors. One is health care is so incredibly local, and you’ve got other larger organizations that have a lot of local presence that I think Priority does. Certainly it’s a statewide plan, but its ability to be very locally oriented to the consumer in Michigan makes a massive difference. I view Priority Health as an organization that’s very deeply involved in the community. I was really fascinated by pretty much everybody on the leadership team and their very deep appreciation for creating vibrance in the community through health care. That’s the main thing that really resonated with me and attracted me to this opportunity.
The second factor? Its values. I’ve interacted with a lot of organizations and I’ve never seen words like ‘curiosity’ and ‘courage’ in their value statements. Priority’s ability to create really compassionate health care and thinking about how they can use collaboration, curiosity and courage differently in the community really resonated with me. I think of all the work that’s taken place already under Joan’s leadership — and she’s been a really visionary leader and did some amazing things — clearly demonstrated to me that the curiosity, courage and certainly the collaboration is there. The ability to really harness that and accelerate the momentum was very attractive.
How will your experience in strategic planning at Humana fit with your new role at Priority Health? I think there’s a really neat fit. A lot of the work that I’ve done at Humana has been focused on not just strategic planning, but strategic execution. There’s long term or short term to that. I’ve spent a lot of time on innovation and what’s referred to as market development. As an example: What are the ideas that will resonate in certain markets (and) how do you enhance your focus on valuebased care and innovation and transformation around transparency? Those are some of the key initiatives that I worked on at Humana and I think those themes really resonate inside the Michigan community and inside of Priority Health as well.
How does the COVID-19 public health crisis affect the health care industry as you transition to Priority Health? It has created a platform for people to create a compelling vision to accelerate change in health care. It’s the silver lining, candidly, to this crisis. In a very short time, the FDA on an emergency basis was able to approve the vaccine. It’s the fastest they have ever moved. What gives me a lot of hope is that we’ll be doing more of that in the future. And as consumers begin to embrace more digital solutions, health care has been ripe for destruction for a very long time around this notion of consumerism and consumers really beginning to take more responsibility for their health and wellbeing, and providers and payers working more closely together toward value-based solutions. It’s accelerated the move toward all of those pieces.
How does it carry the industry forward? Even if you think about the inability of consumers to visit hospitals and clinics (in the spring) and how quickly they evolved (toward adopting telehealth), I think the massive learning there is the system is very resilient and people are very resilient, and everybody has found a solution to operate despite the challenges. The challenge now for us is to continue that momentum and learn from the last nine months and apply those learnings to continue to drive more momentum. It creates a lot of opportunity.
What do you want people and employers in the marketplace to know about you? Two things. One is that we know health care is expensive and we will absolutely do our part to make health care more affordable. To the consumers of health care, health care has been complex for a long time and we’ll continue doing our part to make it simpler day by day. That’s a journey. It’s not a destination that can be accomplished in a year or two years, but we will absolutely do our part to help because the healthier the community is and the more affordable health care is, the more vibrant the community is. That’s ultimately what I care about the most. Interview conducted and condensed by Mark Sanchez. COURTESY PHOTO
22
JANUARY 4, 2021 / MiBiz
ECONOMIC DEVELOPMENT
n The economic development organization for the Muskegon area took on a new name when Muskegon Area First became Greater Muskegon Economic Development under a rebranding initiative that includes a new website. The organization made the change “to better identify our mission and the geographic area we serve,” said President and CEO Jim Edmonson. He cited, for instance, the 13-county Procurement Technical Assistance Center that Greater Muskegon Economic Development manages, and the West Michigan Food Processing Association that covers five counties. n The West Michigan Hispanic Chamber of Commerce will use a $100,000 grant from Bank of America to help businesses through the COVID19 pandemic. The funding supports the expansion of the Hispanic Chamber’s Transformando West Michigan initiative with the launch of the Latinx Business Restart Program, which will provide coaching and training to businesses. The program will assist busine sse s with personal protection equipment such as face masks and plexiglass barriers, plus best practices to restore their supply chain and technology for e-commerce, digital marketing and touchless payments. The grant will also support business coaching in finance and banking practices. n Perrigo Co. plc is seeking a 12-year incentive agreement estimated at $4.1 million in total property tax savings for its plans to relocate its North American headquarters to downtown Grand Rapids. The Grand Rapids City Commission will consider the agreement at a Jan. 12 public hearing. The tax incentive hinges on Perrigo having 150 employees in downtown Grand Rapids within two years of the project’s completion. About 100 will be existing Perrigo employees that will transfer to Grand Rapids, and about 50 will be newly created positions.
FINANCE
n A new $200 million fund to support growing businesses in Michigan intends to direct half of the capital it raises to financing minority-owned companies. Grow Michigan Fund II, the successor to a mezzanine fund formed in 2012 with the backing of state funding and investments from several banks, will target small businesses in an array of sectors including manufacturing, distribution, transportation, life sciences and enabling technologies. Administered by Detroit-based First
Independence Bank, one of the largest African American-owned banks in the U.S., the statewide Grow Michigan Fund II will lend to profitable companies that typically need $500,000 to $5 million, have established relationships with senior lenders, revenue of $3 million to $50 million, and where the capital will increase employment in Michigan.
HEALTH CARE
n Spectrum Health plans to buy out Holland Hospital’s interest in Health Pointe, an outpatient medical campus developed in Grand Haven through a joint venture. Spectrum Health confirmed the move to MiBiz, saying in a statement that the two “mutually agreed that Health Pointe will be most successful going forward outside of a joint venture structure.” The Spectrum Health statement did not indicate the value of buying out Holland Hospital’s interest. The nonprofit, tax-exempt corporate LLC will remain intact and “continue to serve the Grand Haven community just now as a wholly owned subsidiary of Spectrum Health,” Spectrum said. n Five hospitals in West Michigan were among 32 statewide to earn an “A” in a fall report card on patient safety. Spectrum Health hospitals in Zeeland, Greenville and Big Rapids, Metro Health Hospital, and Bronson Battle Creek earned the top grade from The Leapfrog Group, a national nonprofit organization for patient safety based in Washington, D.C. Another 28 hospitals earned a “B” in the fall report card. All of the hospitals owned by Spectrum Health and Trinity Health, including Mercy Health Muskegon and Mercy Health Saint Mary’s in Grand Rapids, earned an “A” or a “B” in the report card. n Hulst Jepsen Physical Therapy opened locations on Baldwin Street in Jenison and Fuller Avenue NE in Grand Rapids. The new locations give the Grand Rapids-based Jepsen Physical Therapy 18 offices in the area.
ENERGY
n Gov. Gretchen Whitmer appointed engineering and energy storage expert Katherine Peretick as a political independent to fill a vacancy on the Michigan Public Service Commission. Peretick, based in Ann Arbor, is the director of engineering for Toronto-based energy storage developer NRStor Inc. and would replace Commissioner Sally Talberg, who resigned to take a job in Texas. Peretick’s appointment is subject to the advice and consent of the state Senate.
AGRICULTURE
n Ravenna High School in Muskegon County was selected by the U.S. Department of Education for a $100,000 Rural Tech Project grant that will support a new agricultural technology program teaching skills in robotics, health care and computer informatics. The first phase of the school’s project will focus on automated beekeeping to allow remotely accessing data and managing hive health. “The act of bee pollination,” Ravenna Public Schools Superintendent Greg Helmer said in an announcement, “is the infrastructure of farming.”
EXPANSION
n Tantrick Brewing Co. is redeveloping a 2,110-square-foot facility at 134 Water St. in Allegan, which will serve as its new production space. The Allegan-based brewery, which currently operates a production space and taproom at 633 114th Ave., plans to finish off renovations by the end of February, when its current lease expires. Tantrick is also working to overhaul the former Long Branch Saloon at 243 Hubbard St. to serve as a restaurant and taproom. The two facilities are just blocks away from each other. Visit www.mibiz.com
UPCOMING ISSUES
1.18.2021
Industry 4.0: Smart Factories Contract Deadline: 1.6.2021
2.1.2021
Cybersecurity Commercial Lending Quarterly: Small Biz Lending Update Contract Deadline: 1.20.2021
2.15.2021
Work From Home M&A, Deals & Dealmakers Awards Contract Deadline: 2.3.2021
3.1.2021
Education & Talent Development Contract Deadline: 2.17.2021 EGLE director on 2050 carbon neutral roadmap
Nonprofits seek restored charitable giving tax credits
PAGE 22
PAGE 21
OCTOBER 12, 2020 • VOL. 32/NO. 26 • $3.00
SERVING WESTERN MICHIGAN BUSINESS SINCE 1988
www.mibiz.com
Action Metro Health pursuing open-heart surgery program in GR Grand reboot eyes By MARK SANCHEZ | MiBiz msanchez@mibiz.com
M
etro Health-University of Michigan Health likely will proceed with seeking state approval to perform open-heart surgery in Grand Rapids, a move that would bring more competition for the procedure to the local market. In a filing last week to the Michigan Department of Health and Human Services, Metro Health indicated it may pursue regulatory authority to launch coronary artery bypass surgery, cardiac valve repair or replacement, repair for birth defects of the heart known as
septal defects, and “other identified appropriate services.” Metro Health would spend $3.2 million to renovate and remodel space at its Wyoming hospital to perform heart surgeries, according to the Oct. 8 letter of intent to the state. The move comes nearly four years after Metro Health was acquired by University of Michigan Health System and Michigan Medicine, its academic medical center in Ann Arbor. “Michigan Medicine is world-renowned for cardiovascular care. This new program will bring that expertise to West Michigan, giving patients choice and access to the most sophisticated treatments and world-class cardiovascular
How should marketing change in the wake of COVID-19?
care. We are proud to help make this a reality,” Metro Health President and CEO Peter Hahn said in a statement to MiBiz. The letter of intent to the state signals a care provider’s interest in seeking a certificate of need (CON) to Hahn launch a new clinical service. Care providers typically will file a letter of intent that places them in line for state review during that quarter as the provider makes a final decision on whether to proceed.
See METRO HEALTH on page 3
Aerospace suppliers brace for continued turbulence
PAGE 9
PAGE 5
MAY 11, 2020 • VOL. 32/NO. 15 • $3.00
SERVING WESTERN MICHIGAN BUSINESS SINCE 1988
Experts warn of possible mental health ‘aftershock’ from COVID-19
www.mibiz.com
EXPLORING WHAT’S NEXT Experts preview workplace changes as economy slowly re-emerges
By MARK SANCHEZ | MiBiz msanchez@mibiz.com
I
f the SARS outbreak 17 years By MARK SANCHEZ | MiBiz ago in Asia is an accurate indimsanchez@mibiz.com cator, behavioral health care providers could see a patient Hikers in Pictured Rocks National Lakeshore in the Upper Peninsula. PHOTO COURTESY OF PURE MICHIGAN eople who have been working from surge in the coming weeks and home for weeks because of the months as the COVID-19 pandemic COVID-19 pandemic will return to a takes an emotional toll on people. decidedly different workplace than One-third of the people in Asia Byhad MARK SANCHEZ they previously once| MiBiz the economythe getspandemic, and with the were unable to return to work full msanchez@mibiz.com restoration of limited funding, going again. time after the SARS pandemic, six Travel Michigan Vice President Changes will span a range of workplace in 10 experienced fatigue, and half he Pure Michigan camDave Lorenz sees an urgency to environments, including offices, shop floors, had difficulty sleeping. that touts the Wearing ramp the Pure Michigan camPAGE 12 PAGE 14 breakroomspaign and conference rooms. In Hong Kong, the suicide rate state as ahaving travel destinapaign back up this fall — in face masks and more distance spiked nearly 32 percent for two tion should soon some form — to support the between workers will return become the norm, years after SARS. Hong Kong also MARCH 16, 2020 • VOL. 32/NO. 11 • $3.00 SERVING WESTERN MICHIGAN BUSINESS SINCE 1988 www.mibiz.com to spur andtemperature winter travel industry that’s popualong with fall routine checkstourism and experienced “increases in persistent and helpcleaning tourism-reliant smallthe worklated by many small businesses. continually and sanitizing depression, anxiety, panic attacks, businesses that were hitworkstations. hard When working with limited place, tools, equipment and psychomotor agitation, psychotic this summer by the COVID-19 funding, Travel Michigan would Those and other pracsymptoms, delirium, and suicidpandemic. put its resources into tices are all part of thetypically proality,” accordA s M ic h iverbial g a n’s “new t ou r inormal” sm the for“big season” and promote ing to a white GR debates increasing industry continues to reel from to nav-See PURE MICHIGAN on page 15 employers working paper from Pine sites for marijuana igate the deadly pandemic Rest Christian businesses; equity, that has disrupted daily rouMental Health local ownership tines, thrown the economy Services on the concerns remain into recession and may linpotential menSmall businesses around West Michigan have been affected in many ways ger for many months until a tal health effects Kennedy P E R I O D I C A L S By SYDNEY SMITH | MiBiz by the ongoing pandemic. While some are seeing increased business, most Eastburg vaccine is developed. of the COVID-19 ssmith@mibiz.com “As business leaders, you have to make pandemic. companies are being forced to deal with the fallout by getting creative, mansure you’re taking the responsibility for your The white report pulls data from GRAND RAPIDS — Following aging cash and finding new ways to stay engaged with customers and cliemployees,” Kentwood-based Autocam a number of sources to issue a call to mixed messages from the Grand Medical Devices LLC CEO John Kennedy action for care providers to prepare ents. In this Coping with COVID-19 special report, MiBiz speaks with two Rapids City Commission late last said during a recent back-to-work webinar for the “aftershocks” from the pandozen West MichiganBycompanies to hear how they’re navigating the current MARK SANCHEZ | MiBiz month, marijuana advocates hosted by Advantage Benefits Group Inc. “It’s demic and “minimize the fallout of msanchez@mibiz.com hope city officials will ultimately incumbent on us as businesses to make sure COVID-19 on mental health in our uncharted waters. SEE PAGES 12-19 open more properties for medicommunities.” See WHAT’S NEXT on page 8 he coronavirus outbreak that’s batcal and recreational facilities. “ Th e w ar n in g sig n s are tered Wall Street and caused supply On Feb. 25, the commission there right now that we could in PAGE 12 Visit mibiz.com for ongoing coverage of the business implications COVID-19 in West Michigan. chain disruptions for some manuwent back and forth on appliMichigan experience of a significant facturers has yet to interrupt transcations for both types of facilisurge in behavioral health needs actions, although more conversations are ties. The city has approved 24 that emerge out of this COVID crioccurring as part of due diligence, according licenses for medical marijuana sis,” Pine Rest CEO Mark Eastburg to M&A professionals. businesses, while another 14 By ANDY BALASKOVITZ | MiBiz benefits for people active in their state’s Program loan — told MiBiz. “We ought to be precall hosted by the West Michigan Policy Deals that are inInprocess involve a deeper are waiting for approval. The abalaskovitz@mibiz.com system. Michigan, this means workwhich requires 75 pared as a state and a community Forum. As of early May, Sturgis Molded dive into due in situations city hasn’t finalized recreers diligence unemployed as a result ofwhere the panpercent of the loan for that in case that happens.” Products was running at about 10 pers some employers express demic could receive upistoacquiring $962 a week. to be used for payone company ational marijuana zoning regT he s t r e s s, a n x iet y a nd cent capacity involving transportation concern about retainThe federal benefits available roll in order to be depression the pandemic trigand medical devices. The company has another that are sources raw for ulations and won’t start accepting workers who are earnup to 39 weeks, while state benefits forgiven — faced gers can come from the loss of a about 200 employees. materials or components ing applications until April 20. more income through were expanded to more workers backlash from job or income, grief, tand “I’ve called people and there has By JESSICA YOUNG | MiBiz Ea rlier his uncermont h at t he Westing Michiga n from China. Buyers areand Hours after voting to delay unemployment benefits than their extended for 26for weeks. employees, since tainty about the future. At Pine been communication that said, ‘I make jyoung@mibiz.com Automotive Suppliers Symposium in Grand Rapids, asking more informarecreational and pause mediPresta normal paychecks, researchers say Media have shown conthe loan effectively Rest, “we’re experiencing a of rise more by not coming in,’” Presta told Mike Wall, director automotive analysis in Grand tionreports about supply chains, cal applications, the City long-term structural fixes are needed cern among employers means workers would be paid their many of the stressors that are MiBiz. “That’s out there.” he automotive industry is scrambling to in strike Rapids at IHS Markit, forecasted light vehicle sales backup plans who and pay theless Commission reversed course state andinfederal programs. than the amount of of replacement benefits worktypical wages. known riskunits for suiSturgis Molded Products’ operaa balance between near-term execution and toofincrease 16.8 million in the U.S.tothis year, the segcapabilities after the six commissionThe $2.2 trillion CARES Act passed ers aresuppliers. receiving. In at least one case Kelly Presta, vice president at Sturgis said.includes cars, utility vehicles tors and first-line positions make unsteady industry disruption from the cide,” novel Eastburg ment that and pickup ers could not agree on how to Brown in late March included provisions to in Washington state, a company Molded Products Co., shared these less than the maximum amount coronavirus outbreak. trucks. “It’s still very new. move forward. A last-minute See MENTAL HEALTH on page 6 add $600 in weekly unemployment that received a Paycheck Protection concerns during an April 22 conference See UNEMPLOYMENT on page 5 That’s according to industry experts who say the Already, that outlook is changing as COVID-19 conEveryone’s trying to figure it out on the fly, dispute among commissioners effect of the virus, which has been spreading around tinues to develop across the country, he told MiBiz. but if clients were selling source parts from also involved equity and local the globe since late December and shut down producAs of this report, IHS Markit was still finalizing a China, you’re going to have to make sure ownership. P global E R I O revised D I C sales A L projection, S tion in specific regions, has shifted forecasts for but Wall expects the new forethey have a backup supply-chain plan in Commissioners were conautomotive production and U.S. sales downward. cast to drop to 16.5 million units. case there is a major disruption,” said Mike sidering zoning amendments Indeed, Gov. Gretchen Whitmer announced “Everything is happening so quickly and there is Brown, who leads the M&A practice at investrecommended by the Planning the state’s first two presumptive positive cases so much volatility that given the circumstances, 16.5 ment bank Charter Capital Partners LLC in Commission that would have in Oakland and Wayne counties on March 10, fol(million) will still be a very good year,” Wall said. Grand Rapids. eliminated a waiver process See SHIFTING DYNAMICS on page 4 lowed by a state of emergency declaration. for sensitive land uses like reliSee DUE DILIGENCE on page 9 gious institutions and opened more properties for cannabis development. Marijuana advocates have PAGE 11 sought to relax distance requirements in order to expand the number of properties qualified for marijuana business use, By ANDY BALASKOVITZ | MiBiz seeking a constitutional amendment graduated, or progressive, income tax. schools and road and water infrastrucwhich they say could also help abalaskovitz@gmail.com to change Michigan’s flat 4.25 percent The Democratic-backed proposals have ture starting in 2022. The plan would address concerns over a lack of income tax to a graduated structure failed to gain traction in the Republicanreduce the state income tax rate for local ownership. s progressive political advobased on income. The Board of State held state House and Senate. individuals with income of $175,000 or Joe Neller, co-founder and cates seek lower state income Canvassers is expected to decide in the In t he late 1960s a nd 1970s, less and joint filers with income at or chief government affairs offitax rates for most Michigan coming weeks whether organizers can Michigan voters by wide margins below $350,000. According to organizcer at Dimondale-based Green residents while higher earncollect signatures in hopes of putting rejected ballot proposals for a graduers, 95 percent of Michigan residents Peak Innovations LLC, said the ers pay more for infrastructure needs, the question to voters in November. ated income tax. Such a change would would pay a lower state income tax rate Planning Commission rejected the state’s leading business group is “If this qualifies for the ballot, require a constitutional amendment. than they do now. a provisioning center proposed bracing for a highly contentious politfrankly, it would be war,” said Rich However, supporters say growing Of the 41 states with income taxes, by his company because of the ical campaign. Studley, president and CEO of the income disparities and declining pub33 have a progressive structure. Federal site’s proximity to a church, Organizers behind the Fair Tax Michigan Chamber of Commerce. lic services have shifted public opinion. income tax also follows a graduated even though the company had Michigan campaign, which was For years, the Chamber has opposed The Fair Tax Michigan plan would raise model. a waiver from the church. announced in late February, are efforts in the state Legislature for a See INCOME TAX on page 3 $1.5 billion in additional revenue for See STATUS QUO on page 8
P COPING With limited funding WITH restored, Pure Michigan T shifts focus to fall and COVID-19 winter tourism
Former Muskegon coal plant to get new owners
Spectrum Health prioritizes buying local
STATUS QUO
— C ORON AV I RUS I N M IC H IG A N —
Virus concerns drive additional due diligence in M&A transactions
T
Golf courses bounce back with banner summer
COVID-19 highlights structural changes needed for unemployment system, researchers say
Automotive analysts see shifting dynamics amid coronavirus spread
downtown amphitheater By ANDY BALASKOVITZ | MiBiz abalaskovitz@mibiz.com GRAND RAPIDS — The business group that pushed several major developments over the past 25 years has multiple new priority projects, including a downtown Grand Rapids amphitheater. Grand Action, which reconvened earlier this year after a nearly three-year hiatus, is studying the feasibility of an amphitheater, expanded convention center space and a professional soccer field. On Oct. 2, the Grand Rapids-Kent County Convention/Arena Authority board approved a resolution authorizing the authority to “proceed with efforts to determine whether there is an appropriate site for the location of an amphitheater.” Grand Action has effectively taken over those efforts from a task force appointed by the CAA Board. Grand Action has “embraced this potential (amphitheater) project and likely will get involved in its planning and fundraising for it,” Steve Heacock, president and CEO of Grand Rapids Whitewater and CAA board member, said during the meeting. “We don’t know that for certain yet, but that’s a very, very good potential.” Heacock added that multiple studies over recent years have all concluded a downtown amphitheater would result in positive economic activity, and that “site selection is the next big step.” Two potential sites on Market Avenue along the Grand River have been previously mentioned: 201 Market SW, where the city recently walked away from a separate $270 million development deal, and 63 Market Ave. SW, the site of the former Charley’s Crab restaurant. The three development projects have been on the radar of civic leaders, developers and city officials for nearly five years. Grand Action, which dissolved at the end of 2017 and relaunched in March under new leadership, has retained consulting firm CSL to provide a new market feasibility study on the projects. The study is expected in late November. Grand Action 2.0 is led by Carol Van Andel, Dick DeVos and Tom Welch, regional president of Fifth Third Bank. DeVos is the only holdover from the previous Grand Action team that was also co-chaired by John Canepa and David Frey, both of whom retired. Formed in 1992, the original Grand Action group pushed major downtown developments such as Van Andel Arena, DeVos Place Convention Center, the relocation of Michigan State University’s medical school to Grand Rapids and the Secchia Center, the Downtown Market, renovation of DeVos Performance Hall and the Grand Rapids Civic Theater.
INSIDE:
Industry 4.0
3.15.2021
Real Estate: Office
Contract Deadline: 3.3.2021
3.29.2021
Utilities & Energy M&A Roundtable
Contract Deadline: 3.17.2021
4.12.2021
Drinking Economy Craft Beverage Roundtable Contract Deadline: 3.31.2021
SEE PAGE 5
A
T
Construction industry adapts to new safety protocols
4.26.2021
Culture & Generational Change Contract Deadline: 4.14.2021
Michigan Chamber prepares for ‘war’ over graduated income tax proposal
A
P
E
R
I
O
D
I
C
A
L
S
Leaders push for action to raise wages PAGE 21
INSIDE:
Business of Senior Care
5.10.2021
Diversity/Equity/Inclusion Commercial Lending Quarterly: Commercial Real Estate Lending Update Contract Deadline: 4.28.2021
SEE PAGE 16
5.24.2021
Food Systems
Contract Deadline: 5.12.2021
6.7.2021
Real Estate: Multifamily Contract Deadline: 5.26.2021
Contact Us Today!
sales@mibiz.com | editor@mibiz.com 616-608-6170
Visit www.mibiz.com
MiBiz / JANUARY 4, 2021
23
From the beach
Fly Safe. Fly Ford. to the board room When you’re ready to travel, we’re here for you. Enhanced measures help ensure you reach your destination the way you left – healthy and safe.
flyford.org/flysafe 24
JANUARY 4, 2021 / MiBiz
Visit www.mibiz.com