Also: Martha Stewart Trimming Trees and Staff This Holiday Season; Waste Removal Firm Removing Excess Office Space; More U.S. Doctors Leaving Private Practice; and 14 More Property Leads
After filing for Chapter 11 bankruptcy reorganization, American Suzuki Motor Corp. said it will wind down and discontinue new automobile sales in the U.S. and instead focus on its long-term growth of its motorcycles/ATV and marine divisions.
The company will seek to sell its U.S. automobile operations, which includes 220 dealerships. At one point, Suzuki had more than 500 dealerships in the U.S., but the firm determined that its automotive division was plagued by low sales volumes, a limited number of models in its line-up, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental U.S. and costs of complying with state and federal regulatory requirements unique to the U.S. market.
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Suzuki said it intends to work within its current U.S. automotive dealer network to help structure a smooth transition from new automobile sales to exclusively parts and service operations, or, in some instances, an orderly wind down of dealership operations.
The company intends to market and sell its remaining U.S. automobile inventory through its automotive dealer network.
M. Freddie Reiss, senior managing director in FTI Consulting Inc.'s Corporate Finance/Restructuring practice in Los Angeles, is the proposed Chief Restructuring Officer for the reorganization. He would oversee dissolution and sale of the Suzuki's auto dealership network.
According to Reiss, Suzuki's automobile sales volume in the continental United States is not competitive. Its most recent market share was only approximately 0.2%.
Martha Stewart Trimming Trees and Staff This Holiday Season
Martha Stewart Living Omnimedia Inc. is restructuring its portfolio of popular media brands. The actions include ceasing print publication of Whole Living and Everyday Food while continuing the latter online only. Positions within the publishing segment are expected to be eliminated as part of the new restructuring initiatives.
The moves follow the reorganization of the company's Broadcast TV group earlier this year and its recently announced partnerships with Hulu, The AOL On Network and FremantleMedia. The company expects the latest print publishing actions to result in $33 million to $35 million in annualized cost savings.
Including the annualized cost savings of approximately $12.5 million associated with the Broadcast TV reorganization earlier this year, the company is now removing an estimated $45 million to $47 million of annual costs from its media businesses on a go-forward basis.
Waste Removal Firm Removing Excess Office Space
Major waste removal firm Republic Services Inc. (NYSE: RSG
) has restructured its field and corporate operations. The changes include relocating office space and reducing administrative staffing levels as well as consolidating field regions from four to three and market areas from 28 to 20.
Republic expects to record expenses of approximately $30 million with respect to this restructuring, approximately one-half of which will be incurred in the fourth quarter of 2012. This restructuring is expected to reduce selling, general and administrative expenses by approximately $23 million annually.
More U.S. Doctors Leaving Private Practice
An increasing number of U.S. doctors are expected to leave private practice for hospital employment over the next 18 months, due to rising costs and technology mandates, according to a new report from Accenture.
Over the past decade, the number of independent U.S. physicians has dropped dramatically, from 57% in 2000 to 39% in 2012. By the end of 2013, Accenture predicts this number will likely drop further, to 36%, and is 3.6% lower than Accenture's 2011 report.
The Accenture findings resulted from extensive market analysis on U.S. physician employment and a survey of 204 physicians in independent practice that was conducted in May 2012.
By the end of 2013, Accenture also estimates that one-in-three doctors remaining independent will offer patients with subscription-based services, such as telemedicine or online consultations, for sustaining profit - a trend that is expected to increase three-fold over the next three years.
Closures & Downsizings
|Company||Address||City||State||Closure or Layoff||No. of Layoffs||Impact Date|
|BRP US, Inc. (Bombardier Recreational Products)||451 E. Illinois Ave.||Benton||IL||Closure||310||11/13/2012|
|Kmart||6525 North Illinois||Fairview Heights||IL||Closure||81||12/9/2012|
|Saks Fifth Avenue||1849 Green Bay Road||Highland Park||IL||Closure||60||2/2/2013|
|Book Wholesalers||1340 Ridgeview Drive||McHenry||IL||Closure||110||Immediately|
|Sears Product Rebuild Center||2063 N. George St.||Melrose Park||IL||Closure||50||11/27/2012|
|Vonachen Services||Caterpillar, 1300 Airport Road||Pontiac||IL||Layoff||50||10/22/2012|
|Eastgate Tower Hotel||222 E. 39th St.||New York||NY||Closure||64||1/16/2013|
|Gallagher's New York Steakhouse||228 W. 52nd St.||New York||NY||Closure||92||1/16/2013|
|Dal-Tile Corp.||103 S. Clark St.||Olean||NY||Closure||179||1/11/2013|
|HMX Group||1155 North Clinton Avenue||Rochester||NY||Closure||431||12/18/2012|
|Personalized Distribution Systems||12 Eighty Four Drive||Eighty Four||PA||Closure||114||12/15/2012|
|Ricoh Americas Corp.||2727 Commerce Way||Philadelphia||PA||Layoff||53||11/29/2012|
|Sears||3470 William Penn Highway||Pittsburgh||PA||Closure||24||1/7/2013|
|New York Wire||441 E. Market St.; 829 Loucks Mill Road; 500 E. Middle St.||York; York; Hanover||PA||Layoff||170||Unknown|
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