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VOL. 7 | NO. 45 | Saturday, November 1, 2014

Daily Digest

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Wright Medical, Tornier Merge in $3.3 Billion Deal

Wright Medical Group Inc. of Memphis announced Monday, Oct. 27, a merger of the specialty orthopedic company with Tornier N.V., a global medical device company headquartered in Amsterdam that makes and markets joint replacement and soft tissue repair devices.

The all-stock transaction, with a combined equity value of $3.3 billion, keeps the headquarters of the new Wright Medical Group N.V. at the Memphis headquarters currently used by Wright Medical.

The merger is expected to officially close in the middle of next year, and the combined company becomes an “extremities-biologics” company.

Current Wright Medical president and CEO Robert Palmisano becomes the president and CEO of the merged company, and Tornier president and CEO David Mowry becomes executive vice president and chief operating officer in the transition.

Palmisano and Mowery both go on the new entity’s 10-member board as part of an even split between the two former companies – five for Wright and five for Tornier.

The companies announced the merger late Monday afternoon, on the same day that each announced third-quarter earnings.

Meanwhile, Wright executives also announced Monday the Food and Drug Administration has determined its Augment Bone Graft is safe and effective as an alternative to ankle autografts and hindfoot fusions.

Tennis Tournament Gets New Name, Lower Prices

The annual indoor pro tennis tournament at The Racquet Club will feature lower prices and have a new name when it’s held Feb. 9-15 next year.

Now dubbed The Memphis Open, the men’s ATP world tour stop will be slashing ticket prices by 15 to 20 percent in all categories, according to tournament director Erin Mazurek.

The U.S. Tennis Association and The Racquet Club purchased the tournament from San Jose-based Sharks Sports & Entertainment this summer. At a news conference, USTA director Gordon Smith said the organization, which is the majority owner of the Memphis Open, is “absolutely committed” to the tournament.

It was also announced during the news conference that the No. 7-ranked player in the world, Kei Nishikori, will play the Memphis Open in 2015. Nishikori is the Memphis stop’s two-time defending champion.

Brokaw to Receive Freedom Award

Broadcaster and journalist Tom Brokaw will receive a Lifetime Achievement Award at the National Civil Rights Museum’s Freedom Awards.

Brokaw will join the three previously announced awards recipients at the Dec. 2 public forum and awards banquet.

They are journalist Charlayne Hunter-Gault, who is receiving the International Freedom Award; baseball Hall of Famer Frank Robinson, who is also receiving a Lifetime Achievement Award; and civil rights Freedom Summer icon Bob Moses, who is receiving the National Freedom Award.

Pyramid Vodka Studio Opening in FedExForum

FedExForum and the Memphis Grizzlies have announced a partnership with Pyramid Vodka, a Big River Distilling Co. venture, which will introduce its premium brand through the new Pyramid Vodka Studio, opening Nov. 11 in the Grand Lobby of FedExForum.

The Pyramid Vodka Studio will replace the space formerly known as FLY Lounge with a more open, accessible floor plan that will be home to the newly formatted Grizzlies live pregame and all-new live postgame shows.

Fans will be able to watch the shows live in the Pyramid Vodka Studio, with complete breakdowns and in-depth analysis, including interviews and special features for all Grizzlies home games.

The Pyramid Vodka Studio will showcase cocktails featuring Pyramid Vodka, a full-service bar and small-plate menu options for fans dining in or on the go. It will be open for every FedExForum event and two hours prior to tip-off for Grizzlies home games and will stay open for up to one hour postgame.

Farrell-Calhoun Applies for $2 Million Building Permit

Farrell-Calhoun Paint Inc. has applied for a $2 million building permit for its Downtown Memphis warehouse.

The family-owned, Memphis-based paint company applied for the building permit through the city-county Office of Construction Code Enforcement for its warehouse at 710 S. Third St. The application said the permit was needed for “modifications and renovation to existing warehouse.”

The nearly 100,000-square-foot building was built on 4.6 acres in 1948. The Shelby County Assessor of Property’s 2014 appraisal is $200,000.

New Retail Shop Coming to Broad

City & State is opening its first concept store, at 2625 Broad Ave., in a 2,700-square-foot space that will carry men and women’s clothing, home goods, accessories, an apothecary and more.

The store, the brainchild of Lisa and Luis Toro, is set to open in early 2015 and will also be home to a craft coffee house. It will focus on high quality roasts and maintain a limited menu of select coffees and teas.

The Toros’ goal is to bring goods from around the country and beyond to the Memphis market. Many of City & State’s artisan goods won’t be found anywhere else in the city, and they’re also supporting and featuring local makers such as Paper & Clay.

Start Co. Planning Startup Weekend

The Start Co. organization in Memphis is hosting a Startup Weekend Nov. 7-9 at its Downtown office.

Startup Weekends are part of an international series of events facilitated by UPGlobal, a nonprofit focused on fostering entrepreneurship in 500 cities around the world. The event in Memphis will be female-centric, focused on showcasing the talents of female entrepreneurs, but both men and women are encouraged to come together for the event.

The event – registration for which is available at www.neverstop.co/startupweekend – is only taking place in 20 cities, including Memphis. That’s because of the city’s track record in supporting the growth of women-led startups, organizers say.

Eastern Tennessee Eyeing Another College

Officials in eastern Tennessee are hoping to open the doors of a 35,000-square-foot building to students seeking a four-year degree.

Sevier County Economic Development Director Allen Newton says the city of Sevierville and Sevier County have agreed to buy the building for $1.1 million.

Newton told WVLT-TV in Knoxville the strategic plan is to recruit a four-year university or college to the county. Newton says the new business will assist in that quest.

Newton says he's eyeing Tennessee College of Applied Technology as a possible tenant if the school chooses to return to Sevier County.

The city and county are working with real estate agents now. They hope to have a school in the building and classes ready by next fall.

Southwind Animal Hospital Sells for $1.1 Million

Southwind Animal Hospital, a veterinary clinic on Winchester Road in the Southwind area, has been sold for $1.1 million.

Southwind Veterinary Partners GP, which includes G. Noell Moseley, Barden A. Greenfield and Genie Hooker, sold the property at 7910 Winchester Road to Southwind Veterinary Holdings LLC, according to an Oct. 24 special warranty deed.

The sale was financed with a $1.1 million loan through First Tennessee Bank NA, according to a deed of trust filed the same day.

The 10,587-square-foot clinic on two acres was built in 1989, and the Shelby County Assessor of Property’s 2014 appraisal is $955.100.

Trustmark Sees Third-Quarter Net Income Gain

Trustmark Corp.’s just-ended third quarter saw the bank grow its net income slightly.

The bank reported $33.6 million of net income, up 2 percent from the prior quarter and third quarter of 2013. During the first nine months of 2014, Trustmark’s net income totaled $95.5 million, up 6 percent from the prior year.

Trustmark president and CEO Gerard Host attributed the results in part to the bank’s strong capital base, which allowed it to see its sixth straight quarter of growth in its legacy loan portfolio, improvement in its efficiency ratio and growth in its insurance and wealth management businesses, as well.

Sears Secures $7.3 Million Loan on East Memphis Store

The parent company of Sears has taken out a $7.3 million loan on the store at 4570 Poplar Ave. in East Memphis, part of a broader effort to pump hundreds of millions into the struggling retailer.

Sears Roebuck and Co. secured the $7.3 million loan on the property from JPP II LLC, which is affiliated with ESL Investments Inc., according to an Oct. 22 deed of trust.

ESL Investments is fully-owned by Sears chairman and CEO Edward S. Lampert, who is providing the cash infusion.

In September, Sears tapped two entities affiliated with ESL for a short-term loan of $400 million. The loan was collateralized by 25 Sears stores, including the one in East Memphis.

Midtown Cash Saver Property Sells for $5.3 Million

The Cash Saver store on Madison Avenue in Midtown has sold for $5.3 million.

Super Market Developers Inc., an affiliate of Associated Wholesale Grocers Inc., sold the grocery store at 1620 Madison Ave. to LAG Memphis LLC, which is affiliated with New York-based Ladder Capital Finance LLC, according to an Oct. 24 special warranty deed.

AWG acquired the property in December 2012 for $3.1 million. The 69,000-square-foot store sits on 5.3 acres on the northern side of Madison between Angelus and North Avalon streets in Midtown. The Shelby County Assessor of Property’s 2014 appraisal is $3.1 million.

The former Piggly Wiggly store was converted to a Cash Saver store several years ago and recently underwent a $1.7 million facelift.

Operators of the Cash Saver store, which includes an extensive beer selection and wildly popular growler shop, signed a 20-year lease on the property last year.

Staples Closes Stores, Keeps Distribution Center

Just a few years after entering the Memphis market, Staples Inc. has closed all of its local stores, including a location on a prime piece of commercial real estate in East Memphis.

Staples has vacated its 18,000-square-foot store at 5851 Poplar Ave. inside the Ridgeway Trace shopping center at Poplar and Interstate 240, and an 18,200-square-foot store at 2321 N. Germantown Parkway.

The office supply company entered the Memphis area in 2011, but the consumer shift toward ordering supplies online has mortally wounded the retailer’s brick-and-mortar operations.

In March, Staples, saying half its sales are now generated online, announced it would close up to 225 stores as part of a plan to save $500 million.

The closures mean the closest Memphis-area Staples store is now in Tupelo, Miss. Staples will continue to operate its distribution center at 4575 Pleasant Hill Road.

In March, National Retail Properties LP bought the Germantown Parkway Staples location from US Real Estate LP for $3.3 million. The store was built in 2011 at the northwest corner of North Germantown Parkway and Market Plaza Drive. The Shelby County Assessor of Property’s 2014 appraisal is $3.3 million.

University of Memphis Weighing Minimum Wage

The University of Memphis is considering paying a minimum wage of $10.10 an hour and stepping into a national debate over how much workers should make for their efforts.

University President M. David Rudd told employees in an email last week that he's asked the state Board of Regents to raise base pay for the school's workers up from $8.75 an hour.

For more than three years, unions and social activists have called for sharply higher minimum pay at U of M and other employers throughout the city. But wages have only slowly climbed.

U of M went ahead with a request for higher pay after paring spending in its tight budget.

Memphis labor leader Tom Smith told The Commercial Appeal the 15.4 percent increase would apply to about 125 employees at the city's largest university.

"This is an extremely welcome move," said Smith, lead organizer in Memphis for United Campus Workers-Communication Workers of America Local 3865.

Rudd's email singled out efficiencies in the university for opening way for the raises. Higher wages could cost U of M about $350,000 next year, according to one estimate.

"For the past several months, we have been evaluating employee salaries and looking for ways to create an affordable living wage for our lowest paid employees," Rudd's email says. "While we can all agree that we have experienced challenging times, thanks to your hard work and dedication we have made great progress in creating efficiencies and positioning the University for continued growth."

In 2011, Local 3865 and the Memphis religious group Workers Interfaith Network began urging then-U of M president Shirley Raines to increase the college's minimum wage. Raines retired in 2013. By then the university was embroiled in budget issues Rudd inherited when he took over this year. A steep drop in enrollment had created a $20 million gap in U of M's $478 million annual budget.

Ramirez Named Shelby County Schools Chief Academic Officer

Heidi Ramirez, the former chief academic officer for Milwaukee Public Schools, is the new chief academic officer for Shelby County Schools.

Ramirez was selected by superintendent Dorsey Hopson and takes the position Nov. 17.

Filling the chief academic officer’s position has been a priority for Hopson since the departure of Roderick Richmond at the end of June. Hopson put off the appointment as he restructured the roles of deputy superintendents this summer.

Ramirez has been an education consultant for about a year. Before that she was chief academic officer in Milwaukee for two years.

Before the posting in Milwaukee, she was associate dean of Temple University’s College of Education in Philadelphia and founding director of Temple’s Urban Education Collaborative for five years and five months.

Ramirez has a master’s degree in education administration from Harvard University and a master’s degree in sociology and a Ph.D. in education from Stanford University.

Judge OKs Auction for Crittenden Hospital Assets

A federal bankruptcy judge has signed off on hiring an auctioneer to sell some assets of the Crittenden Regional Hospital.

The Crittenden Hospital Association filed for bankruptcy last month, reporting $33.3 million in debts and $27.75 million in assets. The bankruptcy filing came after voters approved a special sales tax increase to fund hospital operations, but officials said that wouldn't be enough to keep the hospital afloat.

The state says the tax won't be collected.

According to Arkansas Business, assets heading for the auction block include a clinic, women's center and dental office building in West Memphis and another clinic in Marked Tree. No date has been set for the auction.

$400 Million in Road Projects Delayed in Tennessee

The uncertainty of federal funding has led Tennessee's highway director to delay road projects worth $400 million.

The Tennessean reports 12 construction projects and 21 right-of-way acquisitions were supposed to be complete by Sept. 30, 2015; now they will have to wait until fiscal year 2016.

Tennessee Department of Transportation Commissioner John Schroer sent lawmakers a letter on Friday to notify them of the change.

Schroer says while Congress has approved enough funding to continue road projects through May, it hasn't completed a full six-year highway bill. He says state transportation officials rely on the bill for revenue for long-term projects.

The 33 stalled projects include an Interstate 55 interchange in Shelby County and a truck climbing lane on I-40 east in Dickson and Williamson counties.

"While these projects are only delayed and not canceled, they represent almost $400 million in transportation investments that could be helping to modernize our transportation network and reducing congestion and making Tennessee a more attractive destination for economic expansion," Schroer wrote in the letter.

He asked state lawmakers to lobby the Tennessee congressional delegation to approve a long-term transportation bill.

About half of TDOT's annual budget comes from federal funding, which pays for a majority of the work designed to expand capacity.

"The instability in the flow of these dollars is certainly having an impact on Tennesseans today," he said.

Austin Peay Gas Station Sells for $1.1 Million

An Atlanta-based real estate investment firm has sold a local convenience store and gas station for $1.1 million.

Decatur Properties IV Inc. sold the gas station and store at 4861 Austin Peay Highway to Roopani Properties LLC, according to an Oct. 22 warranty deed. Roopani Properties secured a $1.2 million loan for the purchase through Fidelity Bank, according to a deed of trust filed the same day.

Built in 2006, the 4,080-square-foot store sits on 4.6 acres on Austin Peay just south of Old Brownsville Road. The Shelby County Assessor of Property’s 2014 appraisal is $713,100.

NexAir Dedicates Center to Longtime Employee

Memphis-based nexAir is dedicating the demonstration center at its Bartlett location to operations manager Hugh Nott, who’s retiring this month after 51 years with the company.

NexAir is one of the nation’s largest distributors of atmospheric gases and welding supplies. The Hugh Nott Welding and Cutting Demonstration and Training Center was scheduled to be unveiled at a luncheon in Nott’s honor Wednesday, Oct. 29.

GameStop Raising Money for St. Jude

For the second year in a row, the video game chain GameStop has launched a way for consumers to donate to St. Jude while they shop.

GameStop has again teamed up with St. Jude for its “Thanks and Giving” campaign, which raised more than $1 million for St. Jude last year.

Customers who shop at GameStop between Nov. 3 and Dec. 24 will be able to donate in-store or online to help children battling cancer and other diseases at St. Jude. Customers who make a donation at any GameStop location will get a coupon for 10 percent off the future purchase of a pre-owned game.

Counterpart Wins 3 Design Awards

Memphis-based Counterpart Communication Design has won three American Graphic Design Awards for 2014.

The honors are presented by the publication “Graphic Design USA.” This year marks Counterpart’s ninth year for winning the awards, with a total of 40 in all.

Counterpart received the awards for the designs of International Paper’s Hammermill swatchbook, Memphis-based business consulting firm Calade Partners’ logo and Counterpart’s holiday gift “Client Christmas Stationery 2013.”

RISE Foundation Adds New Board Members

The RISE Foundation, a nonprofit that uses financial literacy to help improve the lives of low-income Memphis residents, has added five new members to its board of directors.

The new members are Crystal Oliver, managing director in human resources at FedEx; Jerry Corless, managing partner at MidSouth Financial Group/MassMutual; Brian Woods, finance director at Nike; Paul Blanchard, vice president, supply chain, industrial packaging at International Paper; and Teresa Morris, Memphis district manager at Wells Fargo Bank.

RISE programs help entry-level wage earners in Memphis and Shelby County to budget, save and accumulate assets. RISE has also developed innovative techniques to teach financial literacy to students in grades 5-12.

UTHSC Researcher Wins Osteoporosis Grant

Susan Miranda, assistant professor in the Department of Orthopaedic Surgery at the University of Tennessee Health Science Center, has received a five-year grant totaling $1.6 million from the National Institute of Arthritis and Musculoskeletal and Skin Diseases, a subsidiary of the National Institutes of Health.

Miranda’s research aims to understand the mechanism of action of estrogens in bone cells, especially focusing on the genes regulated by estrogens in osteoblasts and osteoclasts.

Osteoporosis is a significant public health concern that affects more than 10 million people in the United States. An additional 33.6 million individuals in this country have low bone mass and are at risk for developing osteoporosis.

Wal-Mart Tests Matching Prices With Online Rivals

Wal-Mart Stores Inc. is considering matching online prices from competitors such as Amazon.com, raising the stakes for the holiday shopping season.

The world's largest retailer, based in Bentonville, Arkansas, has matched prices of local store competitors but has not followed other retailers including Best Buy and Target in matching prices of online rivals. But last month, Wal-Mart started to test the strategy in five markets: Atlanta; Charlotte, North Carolina; Dallas; Phoenix; and northwest Arkansas.

The move was first reported by The Wall Street Journal on Thursday.

Wal-Mart is trying to rev up sluggish sales in the U.S. as it battles competition from online retailers, dollar stores and drugstores. At the same time, it's also dealing with a slowly recovering economy that hasn't benefited its low-income shoppers. As a result, Wal-Mart's U.S. namesake stores, which account for 60 percent of its total business, haven't reported growth in a key sales measure in six straight quarters.

But matching prices from sellers that don't have the costs associated with running brick-and-mortar stores could also hurt profits.

Wal-Mart's move underscores how stores are being forced to step up their game for the holiday shopping season, which accounts for about 20 percent of retail industry's annual sales. The National Retail Federation, the nation's largest retail trade group, forecasts a 4.1 percent sales increase to $616.9 billion for November and December from last year. But online sales, which are included in the forecast, are expected to increase anywhere from 8 percent to 11 percent.

PROPERTY SALES 61 262 16,169
MORTGAGES 28 132 10,054
BUILDING PERMITS 88 424 38,360
BANKRUPTCIES 36 92 7,564