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August 2, 2001 Headlines---- Fugitive PinnFund founder gives self up in San Diego GE may appeal decision on Honeywell deal GATX Realigns Its Legal Structure Internet Based Commercial Financing Firm Seeks Investors --- "On the Way to the Top" Hubba-Hubba: Ford exec explores wide world of credit Some Good News: Buying Spree in June Gives Nation a Boost Heller-GE job Cuts To Follow as Tyco-CIT Cuts Consolidated Container Co. Names New President Finance Event Sept. 10-11 in Chicago $1,195/ $1,295 after Aug. 10 Finova Financial Results: Net Loss of $426.5 M for 2nd Quarter NUR Macroprinters & CitiCapital Launch 'NUR Capital' In the U.S U.S. Real Estate Market Will Face Sharp Contraction Thru 2003 Remember, "When the Going Gets Tough"...the Tough Don't Stay Home! Business is waiting for you in Boca ( see announcement ) ### denotes press release --------------------------------------------------------------------------------------------- Fugitive PinnFund founder gives self up in San Diego Fanghella held after hearing in massive securities fraud case By Mike Freeman and Bruce V. Bigelow SAN DIEGO UNION-TRIBUNE STAFF WRITERS Michael J. Fanghella, the PinnFund USA founder wanted in connection with a $330 million securities fraud, surrendered to U.S. marshals yesterday after four months as a fugitive. Wearing a gray suit and accompanied by his attorney, Fanghella, 50, turned himself in unexpectedly at 9:45 a.m. in San Diego, said Mark Owen of the U.S. Marshals Service. Fanghella was sought by authorities for contempt of court for failing to answer civil fraud charges brought in March by the U.S. Securities and Exchange Commission. Federal regulators allege that through the Carlsbad-based PinnFund, Fanghella and James Hillman of Oakland defrauded investors out of $330 million in one of the largest securities fraud cases in San Diego County history. Fanghella appeared yesterday before U.S. Magistrate Judge Anthony Battaglia. Authorities speculated that Fanghella had been hiding in Barbados, where he had a home and bank accounts. Fanghella's attorney, Ezekiel Cortez, denied that his client had been in the Caribbean. Surrounded by reporters after yesterday's brief court hearing, Cortez said Fanghella had not been in the United States, but declined to say where he was. "The media had said he was basking in the sun somewhere," Cortez said. "You could see for yourselves. He was not tan. He was not enjoying himself. He does not look like he's been on vacation." Why did Fanghella flee? Where has he been for the past four months? "That will all come out in court later," Cortez said. Fanghella was held after yesterday's court appearance. Another hearing is scheduled today before U.S. District Judge Marilyn Huff on the contempt charge. A criminal investigation also is under way, said Assistant U.S. Attorney Kevin Kelly. He declined to comment further. Former U.S. Attorney Charles La Bella, now in private practice and hired by the court to search for PinnFund assets, speculated that criminal charges may be filed soon to keep Fanghella in jail. "I am assuming, as a former prosecutor, the U.S. attorney is contemplating filing criminal charges now that he's back in custody," La Bella said. Less than a month ago, the High Court in Barbados froze Fanghella's assets at the request of U.S. authorities. Fanghella and his one-time girlfriend, Kelly Cook, had about $808,000 in a Barbados bank account and owned property there worth $1 million, according to a statement issued by the Barbados government. Earlier, Huff froze Fanghella's assets in the United States and issued a judgment against him for $109 million. "With the asset freeze in place both here and overseas, in most cases (fugitives) choose to do what he did," said Tom Zaccaro, an SEC attorney handling the case. According to the SEC, at least 166 investors "ponied" up $330 million over seven years, thinking they were financing mortgage loans made by PinnFund. The company specialized in home loans for customers with poor credit. ( plus owned and operated along with their mortgage offices, PinnLease. editor ) Authorities contend that instead of funding mortgages, Fanghella used about one-third of the investors' funds to finance his lavish lifestyle. Authorities say an additional $95 million went to cover operating losses at PinnFund, which swelled to 42 offices and had more than 400 employees nationwide before closing March 23. The rest of the money, regulators say, went to pay the promised 17 percent interest to investors. They say the arrangement was a classic Ponzi scheme, where new investor money is used to pay interest to earlier investors. Authorities say Fanghella used investor funds to buy a yacht and expensive dinners, including a $31,000 tab at a restaurant in San Diego. He also used investors' money to pay for jewelry, a $5 million home, artwork and other gifts for Cook. In all, Cook received $14 million in investor funds, the SEC says. Cook, who appeared in adult films under the name Kelly Jaye, is not accused of violating any laws, but she is fighting the SEC's attempts to get her to return what she received from Fanghella. A trial on the case is scheduled this fall. Oakland resident Hillman, who raised the money from investors for PinnFund, maintains that he was duped by Fanghella just as investors were. He is fighting the SEC's charges. Hillman's attorney, Tom Brown of the Shepard Mullin law firm in Los Angeles, said he hopes Fanghella will answer questions about who was aware of the scam. Asked if he was worried that Fanghella would seek a deal with authorities that implicates Hillman, Brown said, "If he makes a deal and tells the truth, I think it's a very positive thing for us." Until yesterday, Fanghella was last seen March 22, the day the SEC filed its civil fraud case. Authorities found purchases on his credit card for a hotel near Los Angeles International Airport and for an airline ticket to Barbados. In court yesterday, Fanghella's attorney emphasized that his client had returned voluntarily to face the SEC's charges. Finova Announces Financials: Net Loss of $426.5 M for 2nd Quarter The FINOVA Group, Inc. announced financial results for the second quarter 2001, reporting a net loss of $436.5 million or $7.15 per diluted share for the quarter ended June 30, 2001, compared to net income of $42.9 million or $0.69 per diluted share in the second quarter of 2000. For the six months ended June 30, 2001, the Company announced a net loss of $512.2 million or $8.39 per diluted share compared to net income of $53.3 million or $0.86 per diluted share in the first six months of 2000. Equipment Leasing Association Thursday Question Does Your Company Communicate Policies for Sharing/Selling Customer's Personal Information to Other Companies? ****************************** The Gramm-Leach-Bliley (GLB) financial services modernization bill passed in 1999 requires financial companies to annually send customers a copy of their policies for sharing and selling their personal information to other companies and to set up a mechanism by which customers can opt-out of such sharing or selling of their personal information. Is your company sending out its privacy policy to customers? That is this month's ELA Online Quick Poll Question. Visit http://www.elaonline.com/ and log in your answer today! ( You need to be a member to participate in the poll and see the result. You can cast a vote and see the results, but your vote will not be counted. When I checked there were 24 no and 11 yes. Those that read Barry Marks, Esq. comments Monday, Aug. 1on recent FTC rulings know the correct answer. http://www.leasingnews.org/archives/August01/8-01-01.htm editor) --------------------------------------------------------------------------------------------- GE may appeal decision on Honeywell deal By Paul Geitner ASSOCIATED PRESS BRUSSELS, Belgium -- General Electric plans to appeal the European Union's decision to block its $41 billion merger with Honeywell International, a source said yesterday. An appeal would not be aimed at reversing the European Commission's rejection of the merger. Instead, GE wants to refute the commission's finding that GE has a dominant position in the jet engine market, the source said on condition of anonymity. That ruling, if allowed to stand, could make it difficult for GE to make future acquisitions. The New York Times carried a similar report, citing unidentified executives close to the company, in its editions yesterday. "We are still considering our options," said GE spokesman Gary Sheffer. The EU announced July 3 that it was blocking the GE-Honeywell merger, the first time it ever took sole responsibility for stopping an all-American deal. GE has until the end of September to file an appeal at the Court of First Instance in Luxembourg, court spokeswoman Fionnuala Connolly said. If GE loses there, it can then go to the European Court of Justice, also in Luxembourg. The court has never annulled a merger prohibition since the EU began reviewing them under its current laws a decade ago. Of six merger prohibitions appealed, three have been upheld and the others are pending, including last year's WorldCom-Sprint deal, which was blocked on both sides of the Atlantic. Antitrust lawyers contend the European courts act too slowly to save deals, but they say appeals can be valuable in clarifying legal issues. Top on the list in the GE-Honeywell case is the EU's reasoning that GE might have been able to drive competitors out of the aerospace market by offering customers a complete package of GE engines, Honeywell avionics and financing from GE Capital Aviation Services. That so-called bundling theory was criticized in the United States, where regulators are more inclined to allow businesses to pursue such synergies, in part because they have more power to break up any monopolies that might result. "I think the commission's decision will set a bad precedent for conglomerates like GE" if it is allowed to stand, said Fiona Carlin, an antitrust lawyer at Baker & McKenzie's European Law Center in Brussels. An appeal is important "so we get some clarity," she said. When WorldCom announced its appeal last year, it said it did not want the EU's decision to "become the basis for future commission actions or initiatives." That case, filed Sept. 27, is in early stages because not all the written submissions have been received, Connolly said. No date for a hearing has been set. GE shares closed down 70 cents at $42.80 in trading yesterday the New York Stock Exchange. _________________________________________________________________ Extent of Heller-GE job cuts unknown
By Melissa Allison Chicago Tribune staff reporter Although General Electric Capital Corp. officials say it is too soon to know how many jobs and other resources they will eliminate to make a success of their planned acquisition of Chicago-based Heller Financial Inc., it is clear that some back-office and headquarters positions will be cut. "There are various headquarters functions they won't need," Heller Chief Executive Richard Almeida said yesterday. And there is overlap in back-office operations, although it is not clear to what extent, he said. But for the most part, even when pitching the same services, the companies have sought different clients. How the operations will be integrated is an open question. GE Capital officials have said they value the culture and management of Heller, but are reluctant to say how much of it will survive. In fact, the company declines to even say how large it is in Heller's primary business: middle-market commercial financing. The $5.3 billion deal announced Monday represents the second-largest acquisition ever for GE Capital parent General Electric Co.--after its more than $6 billion acquisition of NBC parent RCA Corp. in the mid-1980s--but Chicago-based Heller will be only a small cog in GE. Heller has assets of nearly $20 billion and employs 2,500 people worldwide, about 800 of them in Chicago. GE Capital's assets total $370 billion, and the parent company employs 313,000 people worldwide. Even 59-year-old Almeida does not know whether there will be a job for him after the deal closes, although he said he is not ready to retire. Some analysts said Tuesday that Heller's majority owner, Fuji Bank of Japan, gave Almeida veto power over the deal, which he did not exert because he believed it was in the best interest of all shareholders to accept the cash offer from GE Capital, which offered a 50 percent premium. Almeida said only that he was involved in negotiations early on. "They did what was right for shareholders at what might be their own expense, and there aren't a lot of management teams that would make that call," said Reilly Tierney, an analyst at Fox-Pitt, Kelton in New York. Jeff Germanotta, who covers GE for William Blair & Co. in Chicago, said the company typically moves "methodically but swiftly to properly organize the new business." The Heller acquisition "isn't a fire drill," he said. "Heller is a well-run company, so I think they'll move quickly and prudently to integrate it so as to minimize disruption to customers in the marketplace." Almeida said he expects sales representatives and others who deal directly with customers to keep their jobs because there is little overlap with GE Capital in that area. Even in businesses where GE Capital and Heller overlap, Heller tends to go for smaller clientele, Almeida said. And in some areas--a factoring operation in Europe and a strong health-care finance operation--Heller is well ahead of GE Capital, experts said. Still, Almeida said the details of how to mix Heller into GE Capital are not worked out. "At this point, they honestly do not have a road map in terms of how all this is going to get integrated," he said. There is no clear formula at GE or GE Capital for integrating acquisitions. They do so many--GE averages roughly 120 a year, while GE Capital has completed more than 400 acquisitions in the past 10 years--that it is difficult to generalize. What is clear is that GE is anxious to make acquisitions now that European regulators have rejected its bid for Honeywell International Inc. "They're on the warpath for anything they can buy," Tierney said. "They're going to buy Comdisco too." Rosemont-based Comdisco Inc., which entered bankruptcy protection this month, has been in negotiations to sell its leasing business to GE. ( There is one thing for sure, readers, when a bank or finance companies buys another: staff will be let go. They may say there will be none or some in the beginning, but often the person who makes the announcement, he or she will be gone, too. This happened at Bank of America, at Mellon, at every acquisition. It is now happening at CIT, and it will happen at Heller. My advice, take your professional lease recruiter out to lunch. Make them your best friend. You may not need them today, but at least for the next year, start recruiting your recruiter. editor. ) --------------------------------------------------------------------------------------------- Remember, "When the Going Gets Tough"...the Tough Don't Stay Home! Business is waiting for you in Boca "When the Going Gets Tough..." ELA 40th Annual Convention October 28-30 Boca Raton Resort & Club Now more than ever, you need information, ideas and contacts. Get Going and register TODAY for the Equipment Leasing Association 40th Annual Convention. Remember, "When the Going Gets Tough"...the Tough Don't Stay Home! Business is waiting for you in Boca! Complete convention information now available online at http://www.elaonline.com/events/2001/AnnConv/ Note: ELA Announces Silent Auction to Take Place at Convention ONE NIGHT ONLY!!! Sunday OCTOBER 28, 2001 ELA'S 6TH ANNUAL SILENT AUCTION BY THE BEACH AT BOCA 6-8:30 PM - during the opening reception at ELA's 40th Annual Convention __________________________________________________________________ Good News ! !Buying Spree in June Gives Nation a Boost Economy: Spending rose a surprising 0.4% despite rising jobless rate. But consumer confidence fell in July, which may signal slow growth ahead.
By PETER G. GOSSELIN, LOS ANGELES TIMES STAFF WRITER WASHINGTON -- Consumers propped up the stumbling U.S. economy with their spending in June despite growing worries about losing their jobs and a miserly increase in incomes. Personal-consumption expenditures rose an unexpectedly strong $25.7 billion, or 0.4%, in June, the result largely of a bump in the purchase of big-ticket items such as cars, the Commerce Department said Tuesday. The consensus of private economic forecasters had been a 0.3% increase. The up tick in consumption came despite new evidence that the economy was not snapping back as quickly as some had hoped. An index of manufacturing activity in the Chicago area showed that more jobs and production were cut in July as new orders fell further. And it occurred as signs that consumers were growing more concerned about the economy and their chances of being laid off. The Conference Board, a New York business research group, announced that its index of consumer confidence fell to 116.5 in July from a revised 118.9 in June. Most analysts had predicted that it would rise. "The moderate decline in confidence signals slow economic growth ahead," said Lynn Franco, director of the group's consumer research center. Federal Reserve Chairman Alan Greenspan has repeatedly said consumer spending is key to maintaining the nation's economic health. He has warned that any substantial drop in spending could send the economy into recession. Consumers' importance was underscored Friday when the government announced that the economy grew at an anemic 0.7% annual rate in the April-through-June period. Without consumers, who boosted their spending at a rate of 2%, the economy would hardly have grown at all. The nation's business sector, for example, slashed equipment and software investment at a 14.5% annual pace. Some analysts warned of signs that the consumer spending spree could not go on forever. Friday's growth figures showed that although consumption grew during the second quarter, it did so at a slower pace than during the first three months. The Commerce Department said that although personal income increased in June by $27.6 billion, or 0.3%, the increase was outpaced by spending, pushing the already low savings rate down from 1.2% in May to 1.1% in June. In addition, Conference Board officials said the "almost nonstop layoff announcements" of recent months had taken their toll on consumers' optimism, which could dampen their willingness to keep spending. The share of people describing current business conditions as "bad" grew from 12.6% in June to 14.4% in July, according to the group. Those who expect fewer jobs to be available in the next six months increased from 16.3% to 18.1%. The nation's unemployment rate rose to 4.5% in June, when employers slashed 114,000 jobs. The economic consensus is that July's rate will climb to 4.7% and businesses will shed 38,000 more jobs. The Labor Department will release July figures Friday. "Right now, consumer confidence has stabilized and is moving sideways, but I'm not optimistic it's going to stay that way," said Michael J. Moran, chief economist with Daiwa Securities America Inc. in New York. One reason to think the jobless rate could jump is what's going on in manufacturing. The National Assn. of Purchasing Management-Chicago index gave what may turn out to be a sneak preview of the national picture by falling from 45.6 in June to 38 last month. Any reading below 50 signals that business declined. Economists thought the figure would slip to just 43.5. Analysts said the Chicago number suggested that a national report, due out today, would show a similar pattern, signaling that predictions of a turnaround in the manufacturing sector this year were premature. "It looked like manufacturing hit bottom in March and was recovering," said Kathleen Camilli, chief economist with Tucker Anthony in New York. "But if these [Chicago] numbers hold up nationally, that implies there has been a reversal and we're headed down again." #### ####################### ######################## Event For Manufacturers, Financial Firms Will Explore Partnership Issues & Opportunities, Sept. 10-11 in Chicago $1,195 if prior to Aug. 10; afterwards it is $1,295 CHICAGO, -A new conference for manufacturers, consultants and financial firms interested in exploring, expanding or improving sales alliances, captive leasing and global vendor financing programs will be held here Sept. 10-11, at the Omni Chicago Hotel. Competitive pressures to increase sales and global opportunities arising from Internet channels and e-commerce are contributing to rising levels of captive partnerships and vendor financing programs, according to equipment leasing industry data. Program speakers include senior executives from the manufacturing financial divisions of IBM, Pitney Bowes and Sony. Other presenters include financial leaders from GE Capital, Heller Financial and others. International business and e-commerce consultants, such as PureMarkets, a provider of e-commerce solutions for equipment finance; and Seismiq, which offers lease transaction management tools, business process outsourcing and strategic consulting, are also on the program. Event Chairman John C. Deane, a principal in The Alta Group, based in Glenbrook, NV, said this is the first conference designed to bring both manufacturers and their potential financial partners together to tackle emerging issues, share experiences and knowledge. “Our intent is to help manufacturers find partners, explore new business avenues and pre-empt problems that can arise from economic pressures, poor risk management, unrealistic expectations or misconceptions about the financing process,” said Deane. “When done right, captive and vendor financing are valuable sales tools for manufacturers who want to offer more flexibility to their customers. “This will be one place to gather a lot of valuable information in a short time from multiple sources and learn from the experience of others,” he added. In addition to Deane, program chairmen are Paul Frechette, senior vice president; Heller GlobalFinance, San Francisco; and William T. Zadronzy, president, Siemens Financial Services, Inc., Bridgewater, N.J. The conference is sponsored by The Alta Group, Lake Tahoe, NV, consulting specialists in equipment leasing and finance and White Plains, N.Y- based Structured Finance Institute (SFI), a subsidiary of ATLAS Information Group, Inc. SFI regularly sponsors events on tax, legal andaccounting subjects. Some 100 attendees are expected, and those seeking credits for continuing education should note this event is on the National Registry of CPE sponsors. The early registration fee is $1,195 if prior to Aug. 10; afterwards it is $1,295. To register or order conference materials, call 914-686-8855, or email: info@atlas-sfi.com. The speaker materials can be purchased separately at a cost of $345. ### ################# ################### ################### LeasingAssociation Meeting Schedule on Line at:
http://www.leasingnews.org/meetings.htm GATX Realigns Its Legal Structure GATX Corporation (NYSE: GMT) announces that it has completed its previously announced realignment of thelegal structure of its subsidiary companies. The new structure combined GATX's two principal operations, GATX Rail and GATX Capital, into a single legal entity, GATX Financial Corporation. GATX Rail and GATX Capital now are divisions of GATX Financial Corporation. GATX expects that this new single entity structure will result in greater scale and liquidity in the capital markets and lower relative funding costs. The new structure will not affect GATX Corporation's strategic direction, current reporting segments, day-to-day operations, or management structure. GATX Corporation is a specialized finance and leasing company. It uniquely combines asset knowledge and services, structuring expertise, creative partnering and risk capital to provide business solutions to customers and partners worldwide. GATX specializes in railcar and locomotive leasing, aircraft operating leasing, information technology leasing, venture finance and diversified finance. Investor, corporate information and press releases may be found at http://www.gatx.com . A variety of current financial information, historical financial information, press releases and photographs are available at this site. GATX press releases may be obtained by accessing PR Newswire's Company News On-Call's automated fax service at 800-758-5804. The company identification number for GATX is 105121. ######## ############ ########## NUR Macroprinters & CitiCapital Launch 'NUR Capital' In the U.S.
Customer Financing Program to Eliminate Major Barrier to Sales & Open New Markets; Model for Future Programs in Other Regions LOD, Israel, / -- NUR Macroprinters Ltd. (Nasdaq: NURM), a worldwide leading provider of wide and super wide digital printing systems and consumables for the out-of-home advertising market, announced today that its wholly owned subsidiary, NUR America, Inc. and CitiCapital, a division of Citigroup, have launched 'NUR Capital Business & Finance Programs' for current and prospective NUR customers in the United States. The NUR Capital program provides a flexible and practical way for current and prospective NUR customers to bring a new NUR Macroprinters wide or superwide-format digital production printer into their business. The program, which enables NUR customers to pay for what they actually print each month, will be tailored to the individual needs of each client to reflect its production volumes and operational needs. The result is an attractive and less expensive way for customers to install and operate NUR Macroprinters digital printing solutions. The program enables NUR's customers to pay on a monthly basis for their operational needs, including the use of the equipment, all inks and other liquid consumables and "warranty" level of technical support throughout the life of the program. The NUR Capital program is initially available through NUR America only in the U.S. NUR Macroprinters anticipates expanding the program to other geographical regions over time. "We're really excited to introduce this type of innovative 'pay-as-you-go' program, typically associated with office printing systems, to customers in the wide-format printing industry," said Alon Avnon, Vice-President Business Development and program manager for the NUR Capital program. "The program makes the cost of entry into wide-format digital production printing more affordable and puts NUR-quality wide-format digital production printing within reach of significantly more companies. The program also will help customers stay at the forefront of technology without the burden of obsolete equipment." "Citicorp Vendor Finance, Inc. is proud to support NUR Capital in the U.S. As the leading provider of 'Cost Per Usage' solutions to the copy machine industry, we see the wide and super wide digital printing market as a very attractive opportunity," said Robert Schramm, Vice President at CitiCapital Vendor Finance. "Supporting NUR Capital in providing financial resources to develop this market, will enable us to aggressively pursue this opportunity." Erez Shachar, NUR Macroprinters CEO, commented, "The NUR Capital program gives our customers a unique competitive advantage in the marketplace: it allows them to add wide-format digital production printing to their services without tying up excessive capital they otherwise could invest in their businesses. This program reduces the biggest barrier to the adoption of innovation in our industry -- financing. It's another component of our strategy of offering our customers all you need to make it big, and moves us closer to our goal for the out-of-home-advertising market of 'NUR everywhere'." About CitiCapital With a current global portfolio of $42 billion, CitiCapital, a division of Citigroup, is among the largest U.S.-based commercial finance companies. CitiCapital provides a full range of financing solutions and services to over 500,000 customers throughout the world and is a market leader in transportation, material handling, construction, business technology and medical equipment finance, as well as franchise and municipal finance, fleet leasing and relocation services. For more information visit http://www.citicapital.citigroup.com/. About NUR America, Inc. NUR America, Inc. is a subsidiary of NUR Macroprinters Ltd. (Nasdaq: NURM), a world leader in the development, manufacturing, marketing, and support of wide-format and superwide inkjet printing systems and consumables. Headquartered in San Antonio, TX, NUR America is responsible for marketing, sales, and service operations in North, Central, and South America. About NUR Macroprinters Ltd. NUR Macroprinters (Nasdaq: NURM) is a global market leader in wide and super wide digital printing solutions for the out-of-home advertising market. From its photorealistic printers to its high throughput production presses, NUR's comprehensive line of digital printers and consumables address the complete range of wide and super wide format digital printing requirements. NUR's fully digital printing solutions help customers worldwide deliver the high quality and fast turnaround they need to meet their customers' wide ranging printing requirements NUR America, Inc. and NUR Macroprinters Ltd. can be found on the Internet at http://www.nur.com. ### ################ # ### ######### ###### Consolidated Container Co. Names New President/CEO, Announces Second Quarter Earnings
IRVING, Texas--( --Consolidated Container Company today announced that Stephen E. Macadam has been named President and Chief Executive Officer effective August 13. Steve has been Executive Vice President of the Pulp and Paperboard division of Georgia-Pacific Corporation (NYSE: GP). Mr. Macadam will succeed William L. Estes, who has resigned to pursue other investment opportunities. Mr. Macadam, 41, joined Georgia-Pacific in March 1998. During his tenure, he dramatically improved the profitability of the $3.5 billion Pulp and Paperboard division, completed and integrated a $280 million acquisition and successfully consummated two joint ventures. Prior to Georgia-Pacific Mr. Macadam was with McKinsey & Company for ten years where he was a Partner in the Atlanta office and also began the firm's practice in Charlotte, NC. While at McKinsey he was a leader of the firm's operations practice. Before joining McKinsey he worked as an engineering manager for E.I. DuPont de Nemours. Mr. Macadam holds an MBA from Harvard Business School, where he was named a Baker Scholar, the school's highest academic honor, and an M.S. in finance from Boston College. He received a B.S. in mechanical engineering from the University of Kentucky. James P. Kelley, a managing director of Vestar Capital Partners and a member of Consolidated Container's board of directors, said, "Bill Estes has done a good job rationalizing the many businesses that now make up Consolidated Container Company, reducing infrastructure cost, and pursuing new business opportunities. He took three separate companies and twelve smaller acquisitions and combined them to create one of the leading rigid plastic container companies in North America. With the rationalization now successfully behind us, it is now time to bring in a leader who can focus on fine-tuning the Company's business processes and building on the strategic platform that Bill established." Vestar Capital Partners is a private equity firm that is the controlling shareholder in Consolidated Container Company. Mr. Kelley added, "Steve Macadam demonstrated at Georgia-Pacific, and earlier at McKinsey, the leadership skills that can make Consolidated Container the preferred supplier to the many important customers that we serve. His experience in team building and innovation will also contribute to our goal of making Consolidated Container the best employer in the industry for our 4,400 employees. We're delighted to have attracted an executive of Steve's caliber to the Company." Consolidated Container Company LLC also reported today their financial results for the quarter ended June 30, 2001. Second quarter 2001 revenues were $211.7 million, an increase of $18.6 million or 9.6% from the $193.1 million recorded in the second quarter of 2000. Earnings before interest taxes, depreciation and amortization (EBITDA) was $26.9 million for the second quarter 2001, as compared to $34.6 million for the comparable period a year ago. Last year's second quarter EBITDA included $3.0 million of income from a customer contract termination and an insurance recovery. Excluding that income, second quarter 2001 EBITDA declined by $4.7 million or 14.9%. The $18.6 million increase in second quarter 2001 revenue is comprised of $7.8 million of higher sales prices as a result of the pass through of increased resin and other ancillary material costs and a $10.8 million, or approximately 5.5% increase in net sales as a result of higher volumes and the commercialization of two of our eight significant 2001 capital projects. The increased contribution from these sales was more than offset by increased plant operating costs. As a result of increased labor, utility and leasing costs, and, to a lesser extent, delays in passing along higher resin costs to customers, second quarter 2001 gross profit decreased by $5.6 million or 16.2% as compared to the same period a year ago. Due to improvements in working capital management and the successful completion of a $28.8 million leasing program, net debt was reduced to $547.5 million, a decrease of $31.9 million from December 31, 2000 levels. Bryan J. Carey, Chief Financial Officer commented: "We are disappointed in our performance this quarter. While we have been successful in replacing business that was lost during 2000 and in being awarded significant new business, we have not been able to offset external cost pressures from rising utility and transportation costs. We are still incurring a higher level of expenses at locations where we have consolidated plants, as well as locations where we are anticipating new business." He further commented: "We have been awarded significant new business and will be commercializing much of this business in the latter part of this year. In addition, we are undertaking activities to offset external cost pressures to improve productivity and expect gradually improved results in the second half of 2001." #### ##################### ################################## (U.S. Real Estate Market Will Face Sharp Contraction Through 2003, But No Rapid Erosion of Real Estate Values Expected, says PricewaterhouseCoopers NEW YORK-- --According to PricewaterhouseCoopers' Real Estate Value Cycles report released this week, the U.S. real estate market has entered into a contraction phase--characterized by increased vacancy rates, slowing rental growth and rising cap rates-- that will last through 2003. However, the contraction for most markets will not lead to a deep recession and rapid erosion of real estate values as experienced in the early 1990s. Unlike the contraction in the early 1990s, which was caused by massive overbuilding in the late 1980s followed by an economic recession, oversupply is not the primary reason for the contraction era of 2001 to 2003. Instead, slower economic growth and an apparent restructuring of corporate America and U.S. households have moderated the demand for commercial real estate. "We can look with perfect hindsight to the last real estate cycle downturn and identify the causes of the last contraction and subsequent recession," said Peter Korpacz, editor of the report and director in PricewaterhouseCoopers Financial Advisory Services' Global Strategic Real Estate Research Group. "The red flags aren't in abundance today as they were 10 to 12 years ago. There are not the same outward signals in today's real estate markets as found in the late 1980s and early 1990s. We may be over the top, but we are a long way from being under siege." Office Market: Office markets are moving into a contraction phase. This is due to significant changes in office demand growth not oversupply in the market. There are two demand factors contributing to the movement of office markets into contraction: (1) less existing space required per office employee, and (2) less new space needed for each office employee. National office vacancy rates have increased from 8.9 percent to 9.5 percent over the last year, with downtown markets increasing from 7.3 percent to 7.7 percent and suburban markets 9.9 percent to 10.6 percent. Markets that will either experience a brief contraction before returning to expansion or experience stable and slow expansion through 2005 include: Columbus, Minneapolis, Fort Lauderdale, Austin and Las Vegas. Markets with stable value prospects that will remain in a holding pattern through 2005 include Cincinnati, Milwaukee, Honolulu, Charlotte, and Pittsburgh. Markets with that will continue in a contraction phase and dip into recession through 2005 are Miami, Hartford, Tampa, Washington, DC, and San Jose. Retail Market: As of midyear 2001, the national retail real estate market has overwhelmingly moved into contraction. Year-end 2001 projections place 75 percent of the nation's retail stock or 42 of the nation's cities in the contraction phase, up from 47 percent in 2000. By 2003, the total proportion of the retail market positioned in the contraction phase is expected to rise beyond 80 percent. However, vacancy rates will steadily rise over the next five years but will remain well below those witnessed during the recession of the early 1990s. During the height of the previous recession, vacancy was 18.6 percent. In comparison, the retail market is predicted to end 2001 with a vacancy rate of 10.3 percent. Warehouse Market: Major transportation cities and warehouse markets such as Atlanta, Chicago, Houston, Los Angeles, Nashville, and Riverside are now in the contraction phase. However, the warehouse cycles are generally less volatile than the office cycles. Regardless of the demise of many e-tailers, demand for durable and non-durable goods from households and firms are increasing albeit at slower growth rates than in recent years. National Multifamily Market: A primary driving force in household growth is immigration demand coupled with the growth in non-married households. Multifamily demand will remain strong especially in the South and West regions, where rapid population growth is expected. The absolute necessity of having housing, a short construction cycle, improving information flow, and close capital market scrutiny will ensure that new supply levels remain in check with changing demand. As a result, low vacancy rates and moderate rental growth will persist throughout much of the nation leading toward equilibrium conditions for both contracting and recovering markets. Real Estate Value Cycles(R) is published semiannually by PricewaterhouseCoopers. For information about subscribing to this publication or about other products, call (631) 234-5143 or visit www.pwcreval.com PricewaterhouseCoopers (www.pwcglobal.com) helps its clients develop and execute integrated solutions to build value, manage risk and improve their performance. Drawing on the knowledge and skills of 155,000 people in 150 countries, we provide a full range of business advisory and consulting services to leading global, national and local companies and to public institutions. ### #################### ################ Internet Based Commercial Financing Firm Seeks Investors "On the Way to the Top" COLUMBUS, Ohio--( --Commercial Bancorp LLC, an Internet based commercial financing consulting firm announced today they are seeking investors to take the company to the next level. Company spokesman Jerry Cummings Jr. stated "Commercial Bancorp is looking for a cash infusion of $1 million dollars. This would allow us to concentrate on our goal of being the largest commercial real estate financing placement firm in the United States. As with any company, without a healthy cash reserve it is difficult to gain the exposure necessary to attract the large investment firms to our projects. Our current project pipeline is over $400 million dollars. With the cash infusion I see that number tripling with-in 6 months." He continued , " Because of the time lines involved in commercial real estate projects, it is a must that we have the operating capital to see the company through the sometimes tenuous delays that many times crop up." Senior vice-president Harold Levin, former CFO of Value City department stores and former president of Wexner Investments said "This is an exciting time at Commercial Bancorp, we have went from being a start up to a major player in several niche markets. Unlike the retail or investment markets, we have an opportunity to make an impact and make our presence known in a very short time. An added value is our people. Everyone on our staff is an expert and highly respected in their fields. It is truly exciting!" The senior management has not yet decided on how the cash providers will be compensated but have narrowed it down to an equity interest in the company or place it as a line of credit with an above market return. "Our ultimate goal is to partner with a fund where Commercial Bancorp is the sole marketing arm for the fund." Cummings reiterated. "Today's interest rate market has made it very attractive for equity and yield based funds to look for alternative investments. If those funds were to look at our pipeline WLTV and WAC they would find it very attractive for their investors." One area where Commercial Bancorp has excelled is the upscale golf course and flag hotel market. Mainline creditors have shied away from this type of investment. "I believe GE Capital recognized this opportunity with the recent announcement that they were acquiring Heller Financial. The latest quarter results clearly show that Heller's decision to enter the golf course real estate market was a great decision at a time when Bank of America and others were pulling out." according to Mr. Cummings. Commercial Bancorp LLC is a Columbus, Ohio based commercial financing consulting firm. Its primary source of new business is through their web site www.commercialbancorp.com. The company is led by CEO Steve Mooney, former CEO of Finance Development Corporation, president Jerry R. Cummings Jr.-founder, senior vice-president Harold Levin, former CFO of Value City Stores and former president of Wexner Investment Corporation and John O'Brien, vice-president of golf course financing. Please note that this article is neither a solicitation to invest nor a prospectus to potential investors. It complies with the Safe Harbor Act concerning forward-looking statements. Any inquiries as to the quality of this investment should be directed to the investor's personal advisor. No part of this statement should be relied on as an invitation or endorsement to invest. Please contact your investment advisor as to the quality of any investment. --30--jla/cgo* CONTACT: Commercial Bancorp LLC, Westerville, Ohio Jerry Cummings Jr., 614/865-4640, 614/865-4658 Cummings@commercialbancorp.com URL: www.commercialbancorp.com ### ######################### Ford exec explores wide world of credit Global sector offers automaker tremendous growth possibilities By Maureen McDonald / Special to The Detroit News Blanca Fauble
Job: Director, International Internet Services, Ford Credit. She is helping to start Ford's Internet operations in Latin America, Europe and Asia Pacific. Previously she was director of customer satisfaction for General Motors Acceptance Corp. and before that, managed personnel for Saks Fifth Avenue in Troy.
Comment on this story Send this story to a friend Get Home Delivery DEARBORN -- As a young girl in Lima, Peru, Blanca Fauble often questioned her father about who lived beyond the borders of their city and country. Today Fauble, 47, often works out of a conference room at Ford Credit in Dearborn with instant phone, video and Internet access to managers of operations in every big city in the world. Her scope includes Latin America, Asia Pacific Rim and Europe. "This is the job of my dreams -- it is truly global," says Fauble, director of international Internet services for Ford Credit, a post she acquired in October 2000. She speaks fluent English and Spanish and conversational French. "Each day is like peeling an onion as we learn more about the varied need for credit and online access among our customers," Fauble said. A simple form like an application takes on new meaning as Fauble and her team explore the cultural sensitivities to language and security and privacy laws within certain nations. The goal is to reuse up to 70 percent of the Internet application software used in North America with minor adaptations globally. "You have to understand more than the words, it is 'what does the customer want to do with this application,' " she said. Currently 60 percent of Ford's Internet business is conducted in North America with startups in Australia and New Zeeland. The global sector offers tremendous possibility for growth, encouraged by Ford President Jacques Nassar and the Ford executive team. Not every country offers the same products, some have leasing and rental for customers and commercial lending for dealers while others carry warranty insurance, and she wants to see the services become more consistent. Eventually Ford may offer home mortgage and other financial products, not only to Ford but Aston Martin, Jaguar, Land Rover and Volvo customers, part of Ford's Premier Auto Group. That means cultivating a responsive team to handle increased assignments. "Blanca is open, creative, spontaneous and leads from the heart," said Ann Holdreith, president of the Royal Oak-based Leap Unlimited, who lead a recent training seminar for the Ford's Internet group. Pat Dunbar, senior vice-president, Internet for Ford Financial, the overseer of Ford Credit, personally recruited Fauble from GMAC because she observed how capably she performed as the financial group's director of customer service. "I was impressed with the knowledge of her team, their curiosity and dedication to their customers, not to mention the camaraderie with which they worked," Dunbar said. "After she came to Ford I was delighted with her willingness to get in, roll up her sleeves and work with teams around the world."
for internet story with photo of this gorgeous credit executive: http://detnews.com:80/2001/autos/0108/02/c02-257937.htm www.leasingnews.org
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