Welcome to the Dec. 4 Monday Business Briefing, your business intelligence digest from Insider Louisville.
Analyst: Aetna-CVS deal could prompt Humana to be acquired by Walmart
A health care industry analyst said that Aetna’s pending merger with CVS might prompt retail giant Walmart to acquire Humana for somewhere near $300 per share.
Ana Gupte, of Leerink Partners, told Squawk Box Friday that Aetna wanted to acquire CVS in part to start opening community health centers in CVS locations to boost the number of its insurance customers.
Such a union is “potentially transformative,” she said, and could prompt other players to look for similar merger partners, with Walmart a possible acquirer of Humana.
“Humana and Walmart have been in a very tight relationship for like six or seven years … They steer Humana members to Walmart.”
Speculation about Humana preparing for a merger has run high since the Louisville-based insurer started cutting staff in November. Gupte said the cuts, coupled with the sale of a long-term care insurance business and a “change of control” filing, which would reward its executives with millions of dollars in the case of a merger, point to an increasing potential for a merger.
The merger speculation comes on the heels of two failed mergers among insurance giants. Judges this year blocked proposed mergers between Aetna and Humana, and Cigna and Anthem, over antitrust concerns.
Health care experts had told Insider that regardless of the failures of those deals, pressures toward consolidation in the health care industry would remain: Insurance company executives believe that their companies need to get bigger to have greater bargaining power to negotiate good deals with health care providers, such as hospital systems, which also have gotten bigger to counter the heft of the insurers. —Boris Ladwig
Broadway apartment development now accepting lease applications
Highland Station, an apartment complex located at 1172 E. Broadway, is accepting “priority reservations” from potential apartment renters, according to the development’s website.
Insider reached out to Lisa Minklei, a project manager for the Edwards Communities Development Co., to get an update on where the project stands and when the first renters are expected to move in. She did not immediately. The website simply states 2018.
The apartment complex, which is being constructed on the former Mercy Academy site, is four stories and will have 195 units. According to the Highland Station website, a studio apartment starts as $830 a month, while a two-bedroom, two-bathroom apartment with a den will go for $1,985 a month.
The apartments come with granite countertops, modern cabinetry, stainless steel Energy Star appliances, washer and dryer, walk-in closets, 10-foot ceilings and a designated parking space. Select units also will feature a private balcony, fireplace and rain-shower head. Shared amenities include a fitness center, swimming pool, grilling areas, community room and business center.
The company also is building a mixed-use development across Broadway on the former Phoenix Hill Tavern site called The Baxter. There is no word on when work is expected to wrap up on that project. It will have similar amenities to Highland Station, but the development also includes first-floor commercial space. —Caitlin Bowling
Dunkin’ Donuts leaves Bardstown Road
National doughnut chain Dunkin’ Donuts has closed its store at 1250 Bardstown Road in the Mid City Mall shopping center.
A sign recently went up outside the doughnut store looking for a new business to lease the 2,500-square-foot building.
It is unclear why Dunkin’ Donuts shuttered the store. The company did not reply to an email asking about the closure, whether the store would open elsewhere and whether additional Dunkin’ Donuts are expected to close.
Insider also reached out to Tasco Properties to see why Dunkin’ Donuts left and what type of business the company hopes to snag for the space but did not hear back.
Another record-breaking year for lobbying spending in Frankfort
The Kentucky Legislative Ethics Commission reported that lobbying spending will break an all-time record for an odd-numbered year in 2017, as businesses and organizations will surpass $20 million spent on services to lobby members of the General Assembly in Frankfort.
Despite the fact that legislative sessions in odd-numbered years are half as long as sessions in even-numbered years, the final 2017 may approach the all-time record on lobbying spending in any year, which was set in 2016 with $20.8 million.
There are currently 714 businesses and organizations registered to lobby the state legislature, employing a total of 615 lobbyists, with those groups spending an average of $28,000 this year. Ninety percent of lobbying spending goes to compensating lobbyists, while the rest goes to other expenses like office rent, support staff and hosting receptions.
With the next legislative session set to begin in January, the commission also reported that the Kentucky chapter of the National Association of Social Workers recently registered to lobby the General Assembly, as did the Marijuana Policy Project, which is regarded as the largest pro-legalization advocacy group in the country. —Joe Sonka
Ford: November sales up 6.7 percent
Ford Flex and Transit truck sales helped boost Ford’s November sales by 6.7 percent. While Louisville-made vehicles, Escape and Super Duty, also posted sales increases, they lagged behind gains recorded by other SUVs and trucks.
Ford sold 210,771 vehicles in November, up 6.7 percent from a year earlier. Truck sales improved 4.1 percent, to 91,601, and F-Series trucks edged up 0.9 percent, to 72,769. Ford said F-Series sales in November had exceeded 70,000 only three other times. The F-Series includes the Louisville-made Super Duty.
SUV sales rose 13.4 percent, to 68,139, primarily because of higher demand for the Explorer, Flex and Edge, each of which saw gains of more than 20 percent. Sales for the Louisville-made Escape rose 9.1 percent, to 25,101. Car sales improved 5.2 percent.
Employees of Louisville Metro can now earn badges
The Data Governance group and the Office of Civic Innovation have created a citywide initiative called “Badges” to encourage new skills to better help residents, according to the city.
The use of badges has become widespread in everything from apps to corporate settings and the badges are tools of gamification. According to eLearning Industry, “The goals of gamification are to achieve higher levels of engagement, change behaviors, and stimulate collaboration and innovation.”
In its 2020 report on gamification, Gartner predicted that the strategy combined with emerging trends and technologies might result in significant change on different areas of business and society, including an explosion of innovation.
So far in Louisville’s effort, there are two tracks for city workers who participate: Data Scouts and Innovation Pioneers, with more tracks anticipated for 2018.
Here’s how it works: city employees visit a free group managed by the city data officer Michael Schnuerle and select a badge and offer proof that they should receive it. For example, one member of the group earned a badge for attending a hackathon and one for being an expert crowdsourcer.
Badges can be earned for a range of participation and expertise in a range of things like Book Nerd, Citizen Helper, Data Detective, Tourist and more. There are rewards at different levels and for completing a track include digital and physical items, like access to LouieLab, LinkedIn recommendations and computer stickers. —Mickey Meece
Lauren Beckley, formerly manager of sponsorships and products for Greater Louisville Inc., is now executive director of the Louisville chapter of the American Advertising Federation.
EnterpriseCorp is holding its Hot & Fast Innovation Awards (formerly the Hot Dozen and Fast Dozen events) at The Loft at The Gillespie, 421 W. Market St. on Monday, from 5:30 to 7:30, The awards recognize the most promising and innovative, early-stage or fast growth “gazelle” companies to watch in greater Louisville, the organization says.
On Medium.com, Nathan Antetomaso, a social media specialist at Fooji, the internet marketing firm in Lexington, examines “Bourbon, Basketball, and Business: The Growing Technology Startup Scene in Lexington, KY.” He says by way of description: “The future of tech in Lexington is bright. My latest blog is all about how it’s been shaped by everything from a typewriter plant to $100 million of fiber optic cable.”