Lubar & Co., a Milwaukee family-based investment firm has purchased a 50 percent ownership interest in Shared Imaging LLC, a Streamwood, Ill. provider of diagnostic imaging systems and service for hospitals and health care providers. Shared Imaging purchases CT, MRI and other medical imaging equipment, then leases it to hospitals and health care providers around the country. It currently has more than 200 systems in 42 different states. "In addition to leasing services, the company can also operate the equipment, train and assist the providers," said David Lubar, president of Lubar & Co. "They can help users understand its options and features. And with the additional flexibility they provide, equipment can be mounted on trailers and driven to a facility once a week or built into the facility on a permanent basis."

Terms of the purchase were not disclosed. Ray Stachowiak, founder and CEO of Shared Imaging, retained a 50 percent interest in the company. The investment will allow Shared Imaging to expand its service offerings, entering new markets and providing additional value to clients. Lubar & Co. will provide Shared Imaging with both capital and management resources, Lubar said, which will also help the company grow its sales and revenues.

"We selectively invest in companies with outstanding management teams and sound business plans," he said. "Shared Imaging founder and CEO, Ray Stachowiak, is a strong leader with a proven track record in the diagnostic imaging solutions field. We're confident that our investment and management support will serve as a catalyst to enable the company to grow and expand in ways not previously feasible." Lubar & Co. will help Stachowiak develop a formal business plan to grow his company beyond its existing market, Lubar said.

"It will encompass the need to strengthen and build his management team and infrastructure on the people side," he said. "And it will be to acquire additional pieces of equipment on the financing side."Shared Imaging has improved growth potential with Lubar & Co.'s involvement, Stachowiak said. Lubar & Co. has invested in several health care related companies in its 30-year history, Lubar said. The company also takes a long-term view to its investments, making it an attractive alternative to private equity buyers.

"The investment from Lubar has made a strong company even stronger," said Stachowiak. "Our management team has a tremendous amount of respect for the Lubar organization, the firm's long history of successful investments, and the quality of their business counsel. Lubar's guiding operating principals clearly include honesty, integrity and respect, which have permeated our relationship from day one."

Small Business Times recently held the "Next Stage" M&A Forum, where author and consultant Mark Herndon provided advice for business owners interested in plotting their exit strategies. Herndon is president of Dallas-based Parkwood Advisors LLC, a diversified professional services firm focused on M & A, investment banking and private equity investing. Herndon also is the co-author of "The Complete Guide to Mergers and Acquisitions: Process Tools to Support M & A Integration at Every Level." Herndon's complete presentation is posted here, along with a companion slide show of information and his "Exit Strategy Readiness Scorecard."

Beleaguered National City seeks capital infusion
National City Corp.'s stock dipped more than 25 percent Monday after the Cleveland, Ohio-based banking company announced its plan to attempt to raise $7 billion of additional equity capital. With the deal, National City would raise $985 million of private equity capital from Corsair Capital, a private equity firm that invests in the financial services field, and from one other private equity investor. The balance, or just over $6 billion, of equity capital would be purchased by other investors, including several of National City's largest current institutional stockholders.

National City plans to issue 126.2 million shares of common stock at a purchase price of $5 a share and a total of 63,690 shares of Contingent Convertible Perpetual Non-cumulative Preferred Stock, Series G, at a purchase price and liquidation preference of $100,000 per share, according to Crain's Cleveland Business. The amount of stock that National City ultimately could issue under the plan would total 1.4 billion shares of common stock. National City currently has about 633 million shares of common stock outstanding.

National City reported a first-quarter net loss of $171 million, or 27 cents per share. The company has been staggering because of its massive investments in the subprime mortgage market. National City entered the Milwaukee market last year, when it acquired MAF Bancorp Inc., the parent company of MidAmerica Bank that had acquired St. Francis Capital Corp., the former parent company of St. Francis Bank, in 2003. MidAmerica Bank operated 24 branches with $1.3 billion in deposits in the Milwaukee area.

"This strategic raising of equity capital provides National City with the financial flexibility to continue investing in and growing our core businesses, which are delivering solid results, while addressing the asset quality challenges posed by the disruptions in the credit and housing markets," said National City chairman, president and chief executive officer Peter Raskind. "In addition, while we fully recognize that the dividend is an important element of return for our stockholders, the dividend reduction is consistent."

Law firm investigates M&I retirement plan
A Pittsburgh law firm recently announced that it is investigating conduct related to the Marshall & Ilsley (M&I) Retirement Program, the Milwaukee company's 401(k) plan, which the law firm is alleging has contributed to losses to its participants' accounts. Under the Employee Retirement Income Security Act of 1974 (ERISA), M&I had a fiduciary duty to manage the retirement plan solely in the interest of the participants, according to the law firm of Stember Feinstein Doyle & Payne LLC.

The law firm said it is investigating whether M&I violated its fiduciary duties to the plan by maintaining investment offerings in certain Marshall mutual funds, which are owned by M&I, even though many of those funds under-performed their peers. The investigation will include determining the amount of fees that M&I generated by investments of its own employees in the Marshall Funds within the 401(k) plan and whether the fees were a factor in the company's decision to offer the "poor-performing" Marshall Funds instead of other independent mutual funds with historically higher returns.

Ellen Doyle of Stember Feinstein Doyle & Payne has been appointed class counsel to represent numerous classes of ERISA plan participants and has served as lead or co-lead counsel in actions recovering more than $100 million for pension plans and their participants.An M&I spokesperson said the company would have no comment on the statements issued by Feinstein Doyle & Payne. The spokesperson also said the bank's retirement plans have been administered "in complete conformity with applicable fiduciary duties."

Soft real estate market continues to drag on M&I Bank
Marshall & Ilsley Corp. continues to take a pounding from its real estate investments, announcing recently that its first quarter net income dropped 32.5 percent to $146.2 million from $216.8 million in the same period a year ago. The Milwaukee-based parent company of M&I Bank reported quarterly per share net income of 56 cents, down from 83 cents a year earlier. "The continued stress on M&I's construction and development portfolio led to further elevated charge-offs and provisions. M&I posted first quarter net charge-offs of $131 million and a loan loss provision of $146 million," the company said in a statement.

Speaking to a conference call with analysts, Greg Smith, chief financial officer, said the company's quarterly results reflect the "challenging" environment faced by the banking industry today. He said the company expects to continue to see "nonperforming loans" escalate in the commercial and residential real estate markets. M&I is incurring real estate losses in its Arizona and Florida markets, where the company has been expanding in recent years. Those markets also were among the most distressed in the bursting housing bubble.

M&I's reductions in net income would have been worse had they not been buttressed by two "unusual events which contributed to M&I's financial results for the quarter," the company said. M&I recognized pre-tax income of $39 million due to the redemption of 39 percent of the corporation's Visa Inc. stock shares and a related litigation reserve adjustment. M&I also recorded a $20 million tax benefit related to positive developments in the U.S. tax court. M&I's wealth management business produced total revenue of $71.9 million for the quarter, an increase of $11.2 million or 18 percent, over the first quarter of 2007.

Northern Trust reports record quarter
Northern Trust Corp. continues to cruise above the fray of the icy housing market, reporting today record first quarter net income of $385.2 million, or $1.71 per share, up from $186.7 million, or 84 cents per share, in the same period a year ago. The Chicago-based company, which operates a significant office in downtown Milwaukee, said its earnings included a pre-tax benefit of $244.0 million realized in connection with the March initial public offering of Visa Inc. common stock.

Northern Trust's net operating earnings were up 24 percent to $231.7 million from $186.7 million in the first quarter of last year. Frederick Waddell, president and chief executive officer, said, "We are pleased to report record earnings for the quarter. The strong results were achieved in a very difficult economic environment for financial institutions and demonstrate the continued success of our focused business strategy. Record operating earnings for the quarter were driven by excellent growth in trust, investment and other servicing fees, foreign exchange trading income, and net interest income." Northern Trust's first quarter consolidated revenues reached $1.15 billion, up 39 percent from last year's first quarter.

Bank Mutual reports increased Q1 earnings
Bank Mutual Corporation's first quarter income grew to $5.1 million, or 10 cents diluted earnings per share for the period ending March 31, 2008, compared to its earnings of $4.7 million or 8 cents per share during the same period in 2007. Net income increased for the quarter primarily as a result of gains totaling $1.5 million on the sale of investments, partially offset by the non-recurrence in 2008 of a significant 2007 recovery of specific allowance for loan loss in the first quarter of 2007 and a small reduction in net interest income.

The bank reported a 25 percent increase in diluted earnings per share for the quarter ended, compared to the comparable period in 2007. Net income for the quarter ended March 31, 2008 increased 7.5 percent as compared to the same period in 2007.

"Although financial institutions are currently facing a difficult operating environment, we are pleased to report improved quarterly earnings," said Michael T. Crowley, Jr., chairman, president and CEO. "By avoiding risky lending, carefully managing liquidity, controlling expenses and maintaining a strong capital position, the company is well positioned to take advantage of opportunities as they present themselves. While some companies are cutting their dividends we take pride in rewarding our shareholders with total returns that exceed the averages for our sector."

Associated posts lower '08 Q1 earnings
Associated Bank-Corp. recently reported lower first quarter 2008 earnings of $66.5 million or 52 cents per share, compared with $73.4 million or 57 cents per share for the first quarter of 2007. The bank's net interest income was $165 million for the first quarter, compared to $159 million in the first quarter of 2007. Its noninterest income included a $5 million gain related to Visa Inc.'s initial public offering and a $3 million loss related to equity securities. Associated Bank's first quarter results also included a $23 million provision for loan losses, $7 million higher than net charge-offs.

"We are pleased with our revenue dynamics as we continue to generate loan growth, coupled with improved deposit flows," said Paul S. Beideman, the bank's chairman and CEO. "This has contributed to the improvement in our tangible capital ratio to 6.75 percent from 6.59 percent."

Milwaukee private equity group invests in Chicago company 
Lakeview Equity Partners LLC, a Milwaukee-based private equity fund, has purchased a majority interest in Travel Technology Group, a Chicago-based travel coordinator for large events. Financial terms of the acquisition, which closed Thursday night, were not disclosed. "Travel Tech is an attractive company because of its profitability and growth potential, but also because of the resoundingly positive feedback we received from its stakeholders, both internal and external," said W. Kent Velde, president of Lakeview Equity Partners.

The founders and co-owners of Travel Technology Group will retain a minority equity interest in the company. The company's senior management will be retained and will manage day-to-day operations while working with Lakeview Equity Partners to devise future growth strategies.

Travel Technology Group provides event organizers and their customers with full-service housing and travel solutions, using award-winning technology. For example, the company has been named the official housing bureau of the upcoming Republican National Convention in the Twin Cities and is charged with managing the convention's hotel block and coordinating a paperless, online reservation system.

"This new partnership allows us to expand our business and invest more in our people, while remaining true to the clients who have paved the way for our current success," said Bob Derham, managing director of Travel Tech. "Considering the investment criteria of Lakeview Equity Partners, this strategic partnership is a confirmation of Travel Tech's dedication to the industry, our clients and our clients' customers."

Travel Technology Group is the fifth investment made by Lakeview Equity Partners. The company's portfolio includes 5 Alarm Fire and Safety Equipment of Fort Atkinson; Automatän, based in Plover; Firehouse Animal Health Centers in Denver, Colo.; and LS Research, based in Cedarburg.

Delta and Northwest moving ahead on merger
As expected, Delta Air Lines Inc. and Northwest Airlines Corp. recently announced they have agreed to a $17.7 billion merger deal, creating the world's second-largest carrier. The combined airline, which is to be called Delta, would have more than $10 billion in assets, placing it second to Air-France KLM. The new Delta "will provide employees with greater job security, an equity stake in the combined airline, and a more stable platform for future growth in the face of significant economic pressures," the companies said in a joint statement.

Under terms of the deal, Northwest shareholders would receive 1.25 Delta shares for each share they own. The combined company would be headquartered in Atlanta and led by current Delta chief executive officer Richard Anderson. Seven members of the new board will come from Delta and five will come from Northwest, the companies said. Northwest, which is based in Eagan, Minn., owns a minority stake in Midwest Air Group Inc., the Oak Creek-based parent company of Midwest Airlines.

However, the Delta and Northwest alliance will still need to pass regulatory hurdles to become a reality. Several Minnesota politicians, including U.S. Sen. Norm Coleman and Gov. Tim Pawlenty, both Republicans, have expressed opposition, as has U.S. Rep. Jim Oberstar, (D-Minn.), head of the House Transportation and Infrastructure Committee.

Tomo Therapy to acquire Chinese manufacturer
Madison-based Tomo Therapy Inc. a manufacturer of radiation therapy equipment, will acquire Chengdu Twin Peak Accelerator Technology Inc., a privately held linear accelerator manufacturer based in Chengdu, China. The linear accelerators designed, developed and manufactured by Twin Peak will be used to supplement TomoTherapy’s existing supply source. The financial terms of the transaction were not disclosed. TomoTherapy anticipates that the transaction will close in approximately 90 days.

MGIC reports $34.4 million first quarter loss
Milwaukee-based MGIC Investment Corp. recently reported a net loss of $34.4 million for the first quarter, compared with net income of $92.4 million for the same period a year ago. The company's loss per share was 41 cents for the quarter, compared with earnings per share of $1.12 for the same quarter a year ago.

MGIC's total revenues for the first quarter were $423.9 million, compared with $369.6 million in the first quarter of 2007. Net premiums written for the quarter were $368.5 million, compared with $304.0 million in the first quarter last year. New insurance written in the first quarter was $19.1 billion, compared to $12.7 billion in the first quarter of 2007. The company's financial results continue to be affected by increases in both the number of delinquent loans and foreclosures that have resulted as home prices declined further and the economy slowed, said Curt Culver, chairman and chief executive officer of MGIC.

In addition, higher loss severities and lower cure ratios, especially in California and Florida, also negatively impacted results. Culver said he is pleased that the improvements in business fundamentals, including higher persistency, insurance in force growth and improved credit standards are developing as expected and should benefit MGIC financially over the long-term.

He also said that, in response to the unprecedented market conditions, the company has taken numerous actions designed to bolster its financial strength, including increasing its already strong capital resources by approximately $840 million through recent sales of securities, significantly changing its underwriting guidelines, discontinuing writing Wall Street bulk transactions, increasing pricing, pursuing reinsurance options and negotiating the possible sale of its interest in Sherman Financial Group LLC back to Sherman.

Kohl co-sponsors bill to clamp down on mortgage scams
Senators Herb Kohl (D-Wis.), Susan Collins (R-Maine) and Blanche Lincoln (D-Ariz.) have unveiled bipartisan legislation to protect financially distressed homeowners from unscrupulous financial predators. The Foreclosure Rescue Fraud Act of 2008 would help end the dramatic increase of mortgage schemes that have risen nationally by 800 percent in the last five years, with an estimated 60,000 cases expected this year.

"More and more Americans already facing the financial trauma of foreclosure are also falling victim to scam artists who trick them with a false message of hope," Kohl said.  "The time is now for Congress to attack this growing problem, which is a direct consequence of the mortgage crisis plaguing this country. I urge my colleagues in the Senate to support our bipartisan legislation that would end these cruel acts of fraud against struggling homeowners."

Foreclosure rescue scams prey on homeowners in the process of foreclosing their homes and especially vulnerable to deceptive practices that seem to offer hope. Instead, the scams often leave the victims facing a far worse financial predicament, sometimes ruining their credit rating entirely and stripping away their equity, making it almost impossible for them to recover financially.

The Foreclosure Rescue Fraud Act would create strict requirements for a person or entity offering foreclosure rescue services. The legislation would prohibit a foreclosure consultant from collecting any fee or compensation before completing contracted services.

Investor infuses capital into IMS
Praetorian Offshore, Ltd., a major investor in the New Berlin-based business-to-business barter service firm International Monetary Systems, Ltd., has exercised 550,000 warrants at a price of $0.55, providing IMS with an additional $302,500 of invested capital. The company plans to use the funds as working capital for their concentrated efforts in expanding the IMS barter network with new members, continued establishment of best practices and further infrastructure improvements and upgrades.

Founded in 1985, IMS serves 17,600 customers representing 23,000 cardholders in 49 North American markets including Canada. IMS is one of the largest publicly traded barter companies in the world and is continually expanding its network by adding exchange locations. The company's proprietary transaction clearing software enables businesses and individuals to trade goods and services online throughout North America, using an electronic currency known as trade dollars.

Heartland Credit Union selects Third Ward PR agency
Heartland Credit Union, a Madison-based credit union, has selected Blue Horse to handle its marketing communications efforts. Heartland has seven locations serving southwestern Wisconsin and eastern Iowa. Blue Horse, located at 241 N. Broadway, is a full-service marketing communications agency providing advertising, public relations, branding and promotion support on behalf of a broad range of consumer, business-to-business and health care accounts.

UMB Fund Services Inc., a Milwaukee-based subsidiary of UMB Financial Corp., recently appointed Dave Weber as vice president and quality control process manager within the transfer agency. Weber worked previously as national sales director for Envision Financial Services, where he was responsible for developing all of mutual fund services new business, including transfer agency, 529 plan servicing, hedge fund and offshore system needs. UMB Fund Services offers products and services to the mutual fund industry, including administration, fund accounting, alternative investment services, investor services, transfer agency, marketing, distribution and custody.

Schenck Investment Solutions recently hired Kathleen A. Lakritz, CFA, CFP, as an investment manager. Lakritz will provide retirement planning, portfolio review, and asset management services to clients. Prior to joining Schenck, Lakritz spent 18 years at a large Midwest bank and trust organization, where she managed portfolios for personal trusts, individual retirement accounts, pension plans and foundations. Lakritz also served as a portfolio manager for an investment consulting firm in Milwaukee and worked for 6 years at another Milwaukee investment advisory firm where she served as relationship manager and investment manager. 

Bank Mutual recently hired Clifton Facey as bank office manager at its Brown Deer office; Misti Cichosz as loan system administrator/mortgage trainer at its corporate office in Brown Deer; James Goll as bank office manager at its Oklahoma Avenue office; and Kathy Menger as bank office manager at its West Allis office.  

Park Bank recently promoted Bryan L. Swanson to vice president of commercial banking. Swanson is responsible for business development and commercial portfolio management. Swanson is located at Park Bank's Capitol Drive office and is a resident of Brookfield. He joined Park Bank in 2001 as a credit analyst, was promoted to credit officer in 2005 and again promoted in 2006 to a commercial banker.