Actual finance blog

Old Florida National Bank and Mercantile Capital Corp. have entered into a merger agreement expected to be finalized in the late fourth quarter or early first quarter of 2011.

Orlando-based Old Florida National Bank, formed in 1982, currently operates eight full-service retail banking locations throughout Central Florida and Inverness, Fla., with more than $375 million in assets.

Mercantile Capital Corp., a 7-year-old Altamonte Springs firm that specializes in U.S. Small Business Administration 504 loans, has provided commercial loans in 30 states and Puerto Rico for more than $513 million in total project costs since it opened as Mercantile Commercial Capital LLC in late 2002.

“The merger substantially extends Old Florida’s capacity to engage in commercial lending,” said Old Florida Chairman Randy Burden personal loan for poor credit.

Christopher G. Hurn, chief executive officer of Mercantile Capital Corp., said the merger also enables Mercantile to expand its services and help more small business owners nationally.

“Our merger substantially expands the capital resources we can bring to the small business sector of the U.S. economy,” said Hurn.

Under the terms of the merger, Mercantile Capital Corp. will operate as a wholly-owned subsidiary of Old Florida National Bank.

The combined entities are estimated to have nearly $400 million in total assets upon completion of their merger, making Old Florida one of the largest Orlando-based community banks.

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A generic drug maker plans to make a version of the Gilead Sciences Inc. chronic hepatitis B drug Hepsera.

Privately held Sigmapharm Laboratories LLC of Bensalem, Pa., submitted an abbreviated new drug application, or ANDA, to the Food and Drug Administration for permission to make and market generic Hepsera, according to Foster City-based Gilead (NASDAQ: GILD)

Sigmapharm claims that two patents for Hepsera, or adefovir dipivoxil, are invalid, unenforceable or will not be infringed by its generic.

Gilead, which said it is reviewing Sigmapharm’s notice, has 45 days to respond to the application, possibly by filing a patent infringement suit against Sigmapharm. That would suspend the FDA approval process for as long as 30 months.

If Gilead does not respond, Sigmapharm would be able to continue through the FDA drug approval process.

Once-a-day Hepsera tablets, approved by the FDA in September 2002 and European regulators in March 2003, registered sales of $271 payday loan lenders.6 million last year, down 20 percent from 2008. Six-month sales this year of $109.5 million were off nearly 22 percent from the same period last year.

Hepsera costs patients $813 per month.

As the first to challenge Gilead’s patent, Sigmapharm’s drug, if approved, would receive a 180-day monopoly on its lower-cost generic version. That generic monopoly period can translate into big bucks, since the price can be significantly less than that charged for a brand-name drug but not as low as when other generic companies jump in.

Sigmapharm, whose executive team includes former Impax Laboratories sales leader Mitchell Goldberg, has three approved drugs marketed by Rising Pharmaceuticals Inc.

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A grocery store. Restaurants. A wine bar. Renovated apartments and office space. And a badly neglected movie theater restored into a new nonprofit independent film center.

Those were the ideas four developers pitched to a large and eager crowd of North Side residents at the Children’s Museum of Pittsburgh Monday night, on how they would redevelop the focal block of long dilapidated property on North Street in front of Allegheny Commons Park.

The developers — Lawrenceville-based Barron CRE; Spokane, Wash.-based Wells and Company, suburban Philadelphia-based Zukin Realty and locally-based Aaron Stubna — presented their plans for the block best known for the looming presence of the Garden Theater. The neighborhood movie theater was originally built in 1915, but has become an image of blight for decades thanks to its use as a pornographic movie house.

With the theater now long closed and the entire block under the ownership of the Urban Redevelopment Authority, a nonprofit organization called North Side Tomorrow is now leading the effort to choose a developer to take on the block of property.

“This is a good problem to have,” emphasized Kirk Burkley, board president for NorthSide Tomorrow. “We could be here today with (no developers). And we have five.”

The fifth developer, James Welker, was unable to attend Monday's meeting.

The first presentation by Bill Barron proposed tearing down the bulk of the auditorium for the Garden Theater, leaving a restored facade, as required by city historic standards, developing the theater’s front into a restaurant, freeing up space behind it for parking while redeveloping the rest of the surrounding buildings into 34 apartments.

Barron acknowledged up front that he expected the plan to be controversial, his plan calling for the URA to ensure the stability of some of the other long neglected property before taking them on as redevelopment projects. He expects to pursue the remaining four-story Bradberry and Mason Hall buildings as viable redevelopment projects, using the remaining space from eliminating the Garden Theater auditorium to provide dedicated parking for each of the apartment units.

Wells and Company has done many historic redevelopments in Downtown Spokane and have become familiar with Pittsburgh thanks in part to their relationship with Mike Edwards, CEO of the Pittsburgh Downtown Partnership. Edwards served in a similar role with Downtown Spokane’s business improvement district.

Wells proposed pursuing the development under the ownership of a separate nonprofit ownership entity, and then leasing the property for a 50-year term, enabling them to structure financing and development plans to better access historic tax credits and other forms of a assistance.

The company wants to restore the theater and make it available to local arts groups while doing historic rehabs to all the surrounding buildings. Their plan calls for developing as many as 100 apartment units on the site, a number predicated on whether or not the considerably damaged properties on the eastern edge of the block that runs up Federal Street are deemed too far gone to rehabilitate.

If not, Wells plans to develop four-story apartment building there with first-floor retail, a project estimated to cost $10.1 million. If the can be restored, the total project by Wells would call for between 50 and 70 apartments. Their total project cost estimate was between $15 million and $20 million.

Zukin Realty Company, which first became familiar with the Pittsburgh market after it bought the Forbes and Murray building occupied by Vivisimo in 2006 for $11.46 million, also proposed redeveloping only the facade and front portion of the Garden Theater building for a new 5,000 square foot grocery. Wayne Zukin, who has developed historic property in Philadelphia and West Chester, Pa., emphasized an approach based on establishing local independent retailers and restaurants and doing basic rehabilitations of all the buildings that are already in place in the Garden Theater block, adding between 35 and 40 apartments. He estimated his total development cost at between $8 million to $10 million.

Stubna, working with partner Bill Porko, only expressed interest in the theater itself, proposing to restore it into a independent film center that would be redeveloped with a companion wine bar and cafe.

While financing for any real estate development is difficult in the current economy, said Burkley, the North Side’s collaborating community organizations have established a strong package of public assistance for the project. That includes $4 million in new market tax credits raised by the North Side Community Development Fund, $2 million in state funding, and $1.5 million in tax increment financing.

Burkley said North Side Tomorrow plans to make a final selection of a developer this fall and break ground on construction in summer 2011.

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Beacon Power Corp. said Tuesday it had reached a deal to sell up to $25 million worth of its shares to a Chicago-based investment fund over the next 26 months.

The Tyngsboro, Mass.-based company, which develops energy-storage and management technologies, announced it had already sold 1.5 million shares, for $500,000, to Aspire Capital Fund, LLC.

Aspire has committed to buy another $24.5 million worth of common stock under the agreement, according to Beacon Power. The deal allows Beacon to direct Aspire to buy up to 400,000 Beacon shares on any given day at a purchase price of at least 34 cents per share, so long as the closing share price was above 25 cents. “Beacon Power will control the timing and amount of any sales of Beacon common stock to Aspire Capital and will always know the sale price before giving notice to Aspire Capital to buy any shares,” Beacon said in its announcement.

Beacon Power (Nasdaq: BCON) said proceeds from the sales of the common stock will be used for general corporate purposes and working capital.

The stock closed at 32 cents on Friday, and the company’s total market capitalization was $58 instant payday loan.5 million. The share price had lost more than half its value in the past year, falling from 87 cents a share on July 2, 2009.

In the first quarter of this year, the company booked a $5.5 million net loss and saw its cash position slip by 23 percent despite reporting advances for hiring and for the company’s so-called flywheel energy-storage systems.

Among those highlights was accelerated flywheel production for a planned 20 megawatt energy-frequency regulation facility in Stephentown, N.Y. That production was expected to result in 50 new jobs. In May, the company announced $2 million commitment from the New York State Energy Research and Development Authority to help fund the Stephentown plant.

Beacon also announced Tuesday that it had delivered the first power electronics and support systems to the Stephentown plant. The company said it expects to deliver 40 flywheels, the equivalent of 4 megawatts, in the third quarter of this year, and expects the plant to be operational by the end of the first quarter of 2011.

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ST. LOUIS — With less than a week until the President Casino shuts its doors, the union representing workers there turned up the heat Monday over benefits for those who will lose their jobs.

About 25 casino workers gathered at a north St. Louis church to urge Pinnacle Entertainment to give retention or severance benefits to the more than 200 employees who still work at the soon-to-close riverboat casino. They say Pinnacle, when it agreed to close the President, told workers they would receive either severance or jobs at one of the company’s two other casinos. But the company later backed away from that offer.

It is a slap in the face, say employees, many of whom have worked at the riverboat since it opened in 1994.

"We just want to know what we’ve done wrong," said Pamela Perry, a cage cashier who was turned down for jobs at both Lumière Place and River City. "We want answers."

The issue has been a sore spot for months, with the union — Unite Here Local 74 — holding rallies and trying to gather local support, accusing Pinnacle of dumping its President employees. On June 3, a worker filed a complaint with the Equal Employment Opportunity Commission accusing Pinnacle of age discrimination for refusing to hire many President employees over age 40 at its other casinos. And the union has asked three area congressmen to investigate.

Pinnacle says it is not that simple. It says only 63 President employees have applied for jobs at Lumière or River City since December, and it has hired 20 since March. It held a job fair and training programs, but relatively few employees came, said Jack Godfrey, the company’s general counsel.

And in a statement Monday, Pinnacle said the union could have helped save jobs by being a stronger ally when the Missouri Gaming Commission was trying to close the casino early this year.

"We wish that Local 74 really had exhibited the same zest in keeping the property open that they are now displaying with an advertising and web campaigns against Pinnacle," Godfrey said in a statement.

The sharp words came as the two sides prepared to meet today for more talks on a severance package. It is just the first sit-down they have had in a month. With the President set to close Monday, time is running out. But Dave Morton, an organizer with the union, said Local 74 would keep pushing.

"This fight doesn’t end on June 28."

——

Jacob Barker of the Post-Dispatch contributed to this report.

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Expedia Inc. said it plans to add 130 jobs to its Las Vegas office by the end of the month.

The Bellevue online travel agency (NASDAQ: EXPE) said the new jobs will be mostly travel agents and support staff for Egencia, the corporate travel arm of Expedia that services corporate travel accounts.

Here's Expedia's press release:

LAS VEGAS, June 18 /PRNewswire/ — Expedia, Inc., the world's largest online travel company, today announced they will add 130 new jobs to the online travel company's Las Vegas operations by month's end, bringing the local office total to 500 employees. Las Vegas is home to a number of operational functions serving a number of the company's travel brands, including Expedia.com, Hotels.com and Egencia. The company will host an open house in late June to celebrate the expansion and provide tours to several local elected officials and community leaders.

"Expedia has long been a partner of the Las Vegas travel and tourism industry, and we are pleased to be able to add jobs in this community," said Michael Reichartz, Las Vegas-based vice president of market management for Expedia. "This expansion means new jobs for 130 Nevadans and we are hopeful for further growth, which is always something to celebrate. We applaud Senator Reid for his leadership in passing the HIRE Act, which has assisted us with this expansion."

"Extending our service network into Las Vegas is a key part of our strategy and ability to support clients worldwide," said Noah Tratt, vice president, Egencia Americas. "Egencia has been pleased with the wealth of talent and experience in Nevada. We are looking forward to expanding our service center here and bringing jobs to the area."

Expedia officials said the company will benefit from incentives provided by the federal "Hiring Incentives to Restore Employment (HIRE) Act," which was designed to create or restore employment to previously unemployed individuals.

The new jobs, mostly travel agents and support staff, will serve Egencia operations, the corporate travel arm of Expedia that services corporate travel accounts for companies globally. Other operations at the Las Vegas office include telesales, customer support and additional functions. Expedia's Las Vegas office is located at 10190 Covington Cross Drive in Summerlin.

About Expedia, Inc.

Expedia, Inc. is the largest online travel company in the world, with an extensive brand portfolio that includes more than 90 localized Expedia.com®- and Hotels.com®-branded sites; leading U.S. discount travel site Hotwire®; leading agency hotel company Venere.com™; Egencia™, the world's fifth largest corporate travel management company; the world's largest travel community TripAdvisor® Media Network; destination activities provider ExpediaLocalExpert®; luxury travel specialist Classic Vacations®; and China's second largest booking site eLong™. The company delivers consumers value in leisure and business travel, drives incremental demand and direct bookings to travel suppliers, and provides advertisers vast opportunity to reach the most valuable audience of in-market travel consumers anywhere through TripAdvisor Media Network and Expedia Media Solutions. Expedia also powers bookings for some of the world's leading airlines and hotels, top consumer brands, high traffic websites, and thousands of active affiliates through Expedia® Affiliate Network. (Nasdaq:EXPE)

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Social media management software maker Socialware Inc. has closed on a nearly $4.2 million Series A round of financing.

Austin-based Socialware, which develops a new category of software called social middleware, received the capital from 10 investors, according to a Monday filing with the U.S. Securities and Exchange Commission.

Investors include Austin-based venture capital firm Silverton Partners, G-51 Capital and the California-based Floodgate Fund LP, CEO Chad Bockius said.

The capital was raised for future purposes rather than to fund immediate initiatives. “We will grow the business alongside market opportunities,” he said.

Socialware, which was founded in 2008, employs 20 workers. In September 2009, the company reported receiving $2.1 million, which was the first tranche of the round, Bockius said.

The company was co-founded by Chris Richter and Cameron Cooper, both early employees and developers at Bazaarvoice Inc., an Austin-based company that manages online customer communities for clients such as Wal-Mart Stores Inc. (NYSE: WMT). Richter was also an early employee of Webify Solutions Inc., an Austin-based software maker acquired in 2006 by IBM Corp. (NYSE: IBM) for an undisclosed amount.

Cooper, Socialware’s chief technology officer, was also a software engineer at Crossroads Systems Inc., an Austin-based software maker that is also a portfolio company of Silverton Partners.

In January, Richter stepped down from the CEO position while the company searched for an interim replacement. He subsequently left the company and Bockius, the former vice president of marketing, was appointed CEO.

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Booyah Inc. said on Monday that it has raised a $20 million round of funding led by Accel Partners.

The Palo Alto-based company has a popular app for Apple Inc.'s iPhone called MyTown, a game in which users "check in" at physical locations to move ahead. It has an estimated 2 million users and is reportedly growing at a rate of 100,000 users a week.

Cofounder and CEO Keith Lee said the company plans to use the money to expand its work force and invest in to-be-announced new projects.

In addition to Palo Alto-based Accel, existing investors Kleiner Perkins Caufield & Byers of Menlo Park and DAG Ventures of Palo Alto also participated in the round.

Accel partner Jim Breyer is joining Booyah's board. "Booyah is at the epicenter of the fastest growing markets today— mobile, social, and interactive gaming," he said.

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Ameren Corp. will cut 75 jobs at its merchant generation business, which produces electricity for the commercial and wholesale power markets.

The jobs, both management and union-represented, are at several power plants and support service facilities in Illinois and Missouri. Affected employees will be notified in mid-May. No further details were given.

"While it is always difficult to reduce staffing, we believe these reductions are critical to meet the realities of today’s depressed power markets. Prices for the power we sell today are far below the levels of earlier years," said Chuck Naslund, president and chief executive of Ameren Energy Resources Co., which operates St. Louis-based Ameren’s merchant generation business.

These staffing reductions, coupled with other planned spending cuts, will reduce net expenses by about $20 million in 2010, Ameren said Monday in a news release. Ameren Energy Resources will also evaluate temporarily ceasing operations at its least-efficient plants and taking actions to reduce its benefits costs.

Monday’s announcement follows the elimination of about 135 Ameren Energy Resources positions in 2009.

The company said the layoffs are unrelated to the Illinois Commerce Commission’s decision to slash Ameren’s request to raise electricity and natural gas rates.

Last week, Illinois regulators permitted Ameren to collect only an additional $5 million a year in electricity delivery charges after it initially sought a $162 million increase to help meet rising costs and pay for infrastructure improvements. The ICC also ordered a reduction in the gas delivery charges for all Ameren customers in that state.

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McLean-based Capital One Financial Corp. reported profits for its latest quarter and said the worst of its bad loans are behind it.

Capital One had fiscal first-quarter net income of $636.3 million, or $1.40 per share, compared with a net loss of $108.1 million, or 44 cents per share, in the same quarter a year earlier.

“We believe that charge-offs in our consumer lending businesses likely peaked in the first quarter,” said CEO Richard Fairbank. “While legislative and regulatory uncertainty remains, we believe that we are well-positioned to ramp up our businesses as we emerge from the recession.”

Capital One (NYSE: COF) had first-quarter revenue of $4.3 billion, down 1.8 percent from the previous year.

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